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=ASIA MARKETS: Singapore Shares Slip To Over 8-Month Lows, Malaysia Ends Higher

SINGAPORE (Jun 22) -- Singapore stocks extended their fall Friday with the benchmark index ending at more-than eight month low amid simmering trade tension between the U.S. and China. Meanwhile, bargain hunting helped Malaysian shares snap nine straight sessions of losses.

The Straits Times Index declined 0.3% to 3,291.02, capping a weekly loss of 2%. The FBM KLCI, which fell to its 17-month low Thursday, edged 0.1% higher to 1,694.15. It shed 3.8% through the week.

Caution rules across Asian markets as lurking worries over impact of an ongoing trade spat between the world’s two largest economies continue to spook investors. The Nikkei Asia300 index of prominent regional firms rose 0.5% but fell 2.9% for the week.

“If China-US trade relations worsen, Asia economies that are highly geared towards exports, including Singapore, would likely suffer collateral damage given trade and supply chain linkages,” DBS Bank, Singapore’s largest lender by assets, said in a note to investors. “Another wave of US tariffs on Chinese imports would be in place on 6 July. If implemented, this could set the stage for another round of reprisal as tit-for-tat continues.”

Shares of the bank slipped 0.5%, while rivals Oversea-Chinese Banking Corporation and United Overseas Bank fell 1% and 0.8%.

“We expect stocks that have underperformed the STI year-to-date but continue to have positive earnings momentum to recover as second quarter earnings season begins next month,” KGI Securities wrote in an investor note.

In Malaysia, “investors are buying on the dip,” said Vincent Lau, a vice-president at broker Rakuten Trade. “Value buyers are greedy when the market is fearful. I still feel the outlook for Malaysia equities are attractive.”

Oil prices gained amid uncertainty on whether the Organization of the Petroleum Exporting Countries would agree to raise production at its Vienna meeting.

Malaysian oil-and-gas service company Sapura Energy, which earlier announced it had won several contracts worth 1.8 billion ringgit, rose 7.5%, while Dialog Group added 1%. In Singapore, Ezion Holdings rallied 9.5%.

Insulation products maker Superlon Holdings tumbled 18.4% after reporting a 78% drop in fiscal fourth-quarter net profit, dragged by lower sales and higher costs.

In Singapore, Lifebrandz jumped 16.7% after announcing plans for a new sushi restaurant chain with outlets in Singapore, San Francisco and Tokyo.

Singapore Airlines, which said Thursday it expected to transfer some jets from its SilkAir regional airline to budget carrier Scoot to allow the group to compete more effectively against low-cost rivals, closed 0.1% higher.

Embattled commodities trader Noble Group rose 35.6% to a two-month high. Shares have rallied 161.1% since it reached a deal on Wednesday with major shareholder Goldilocks Investment, paving the way for a restructuring exercise.

- By Joannah Perez and Alexander Winifred, joannah.perez@nikkeinewsrise.com; +65 6331 6250
- Edited By Abhrajit Gangopadhyay
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