singapores straits times index ends flat as economy escapes recession 1577352015

Singapore stocks ended hardly changed yesterday (October 14) despite fresh concerns about the Chinese economy sparked by the release of weaker-than-expected inflation data.

On the positive side, advance GDP data showed that Singapore narrowly avoided slipping into a technical recession in the third quarter, recording 0.1 per cent quarter-on-quarter growth. The Monetary Authority of Singapore (MAS) said it will marginally ease its monetary policy for the second time this year by slowing the pace of the Singapore dollar’s appreciation.

Indices

The Straits Times Index (STI) ended 0.96 points or 0.03 per cent lower at 2,983.92, taking the year-to-date performance to -11.33 per cent.

The FTSE ST Mid Cap Index gained 0.40 per cent, while the FTSE ST Small Cap Index rose 0.15 per cent.

The Singapore Exchange traded a volume of 1,034 million shares valued at SG$906.9 million. Losers outnumbered gainers by 217/177.

Amongst the FTSE ST sectors, the top gaining sectors included basic materials (+1.89 per cent), maritime (+1.29 per cent), oil and gas (0.95 per cent) and real estate investment trusts (+0.29 per cent). The losing sectors included technology (-1.79 per cent), utilities (-1.04 per cent), Catalist index (-0.62 per cent) and consumer services (-0.53 per cent).

Stocks

Noble Group Limited (SGX:N21) was up 1.06 per cent to SG$0.475. The company’s Chief Executive Yusuf Alireza admitted yesterday at the Singapore Institute of Directors conference that the company could have defended itself better against short sellers had it been more transparent in its disclosure of important information to stakeholders. "In hindsight, I should have been more forceful with the board about supporting more transparency because I think if we had more transparency, we would be less exposed," he said, as quoted by the Straits Times.

Soilbuild Business Space REIT (SGX:SV3U) closed unchanged at SG$0.820. The REIT recorded a distribution per unit (DPU) of 1.625 Singapore cents during the third quarter ended September 30, about 5 per cent of the prior year period. Distribution income surged 20.8 per cent to SG$15.1 million while gross revenue surged 22.4 per cent to SG$20.7 million. The performance was attributed to additional rental revenue from acquisitions that were completed in the last two years, according to the Straits Times.

Anwell Technologies Limited (SGX:G5X) intends to apply to the High Court to be placed under judicial management, the Straits Times said.

Transit-Mixed Concrete Ltd (SGX:570) said net profit during the half-year ended August 31 jumped 63 per cent to SG$3.3 million, while revenue during the period surged 23 per cent to SG$17.1 million. The company attributed the performance to the increase in concrete pumping sales due to higher construction activities of infrastructure and housing projects in Singapore and Malaysia.

Shares in GKE Corporation Ltd (SGX:595) fell 2.56 per cent to SG$0.076. The company said net loss during the three months to August 31 declined to SG$109,000 compared to SG$434,000 in the previous quarter, and revenue fell 9.8 per cent to SG$8.7 million, mainly due to the cessation of certain business operations as well as asset disposals, according to the Straits Times.

Economic news

In its October monetary policy statement the Monetary Authority of Singapore (MAS) continued with its policy of “a modest and gradual” appreciation in the S$NEER (Singapore dollar nominal effective exchange rate) band, although the rate of appreciation will be "reduced slightly," the Business Times said. The central bank’s action was unexpected, given that the market was anticipating an easing strategy.

MAS did not change either the width of the policy band, nor the level at which it is centered. "This measured adjustment (to monetary policy) follows the move to reduce the rate of appreciation of the policy band in January this year, and is supportive of economic growth into 2016, while ensuring price stability over the medium term," it said.

Advance GDP estimates released yesterday by Singapore’s Ministry of Trade and Industry showed that the economy expanded a mere 0.1 per cent in the third quarter compared to a contraction of 2.5 per cent in the second quarter. The economy, therefore, narrowly averted sliding into a technical recession, and that may have been the reason MAS avoided a more aggressive currency easing adjustment.

According to flash estimates released by SRX Property, rentals of private, non-landed residential properties fell 0.3 per cent during September compared to a month ago, weighed by falls in the suburban areas and city fringes. According to analysts, the weak rentals could be attributed to the seasonally weak second half of the year, as well as fresh supplies of new homes. Nevertheless, lower rentals still failed to boost transaction volume, which fell 4.1 per cent to 3,758 transactions in September versus 3,919 in August.

On Wall Street Wednesday, stocks ended lower in response to a disappointing profit outlook from retail giant Walmart, and the modest growth in the economy according to the US Federal Reserve's Beige Book report on regional economic conditions. The Dow Jones Industrial Average closed down 157 points or 0.92 per cent to 16,924. The S&P 500 lost 0.47 per cent to end at 1,994 and the Nasdaq eased by 0.29 per cent to 4,782.