singapore stocks turned lower thursday ahead of a long election weekend 1294142015

Singapore stocks ended the week on a downbeat note Thursday with prices tracking lower levels on poor volume.

Investors trimmed their exposures going into the long election weekend, and preferred keeping a low profile given the looming US Fed meeting this week that would decide on a hike (or not) in interest rates.

Indices and sectors

The Straits Times Index (STI) ended Thursday 40.15 points or 1.37 per cent lower to 2,888.03, taking the year-to-date performance to -14.18 per cent.

The FTSE ST Mid Cap Index declined 1.01 per cent, while the FTSE ST Small Cap Index declined 1.07 per cent.

The Singapore Exchange traded a volume of 914.3 million shares valued at SG$758.6 million. Losers outnumbered gainers by 304/129.

Amongst the FTSE ST sectors, the losing sectors included oil and gas (-2.33 per cent), technology (-2.06 per cent), healthcare (-2.05 per cent), consumer goods (-1.98 per cent), basic materials (-1.92 per cent), China (-1.71 per cent) and China top index (-1.69 per cent). There were no gaining sectors on Thursday.

Stocks

NauticAWT Pte Ltd (SGX:42D), an oil and gas contractor, swung to a net loss of US$1.8 million (SG$2.54 million) in the first half of the year from a net profit of US$1.7 million in the prior year period. According to the company, profits were dragged down by listing costs as well as its recent acquisition of businesses from AWT International. Revenue for the first half increased by 56.7 per cent to US$14 million, of which US$6.9 million was contributed by the AWT businesses, the Business Times said.

Shares in chemical fibre manufacturer China Sky Chemical Fibre Co Ltd (SGX:E90) plunged 41.18 per cent to SG$0.06 on Thursday when the company’s shares resumed trading after a lapse of nearly 4 years during which time it was suspended.

According to an article in Barron’s, the slowdown in the Chinese economy, tough competition in e-commerce and rigorous scrutiny of the company’s governance are likely to drive down the shares of Alibaba Group Holding Ltd (NYSE:BABA) by another 50 per cent. The stock last traded on the NYSE at US$64.68, up 1.32 per cent.

Economic news

The ruling People’s Action Party (PAP) won a solid 69.9 per cent of the electorate vote in Friday’s election, up from 60.1 per cent in the 2011 polls, and the highest percentage of votes the PAP has won since 2001. It was a vote for stability and for steady progress in an uncertain world, said Deputy Prime Minister Tharman Shanmugaratnam. “The combination of China, Malaysia, and Indonesia looking less certain than it used to be, rattling investors’ confidence, does make a difference to us as well,” Mr Tharman said, as quoted by TODAY. “So, we’ve got to watch this carefully, and we’ve got to make sure that our economy, not just short-term, three months or six months, but over the next few years, stays on even keel and we are able to create good jobs for Singaporeans.”

Fears on China’s economic growth are likely to be rekindled by the release of disappointing economic data over the weekend. Growth in China’s fixed-asset investment, a key driver of the economy, slowed to 10.9 per cent in the first eight months of 2015 — the weakest seen in nearly 15 years – and missing analysts’ expectations of a growth of 11.1 per cent. Factory output in August rose 6.1 per cent whereas markets expected a 6.4 per cent increase. Real estate investments cooled to a 3.5 per cent annual growth in the first eight months, the weakest data since early 2009, according to TODAY.

On Wall Street, stocks ended higher on the last day of the week as investors weighed the possibility that the Fed would hold off raising interest rates at its forthcoming meeting. Even though energy shares were soft, at the closing bell the Dow Jones Industrial Average rose 102.69 points, or 0.63 percent, to 16,433.09, the S&P 500 gained 8.76 points, or 0.45 percent, to 1,961.05 and the Nasdaq Composite added 26.09 points, or 0.54 percent, to 4,822.34.