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Economic slowdown fears hit stock markets
Publication Date : 05-09-2012
Nervous investors worried about the weakening economies in China, the United States and Europe left the share market in the doldrums yesterday.
The lack of anything to inspire caused the benchmark Straits Times Index to drift down 5.67 points or 0.19 per cent to 3,011.55.
Trading volume was equally uninspiring, with 1.175 billion shares worth S$663.9 million (US$533 million) changing hands, a touch better than Monday's 909.7 million shares worth S$662.4 million.
It was a similar story across the region: Hong Kong's Hang Seng Index slipped 0.7 per cent; the Shanghai Composite was down 0.8 per cent and Australia's ASX 200 dipped 0.6 per cent.
Gloomy data dominated the market. The euro zone's manufacturing output contracted in August, for the seventh month in a row, sparking expectations that the central bank will intervene when it meets tomorrow.
Traders will be awaiting the US non-farm payrolls report for August, which will be out on Friday. Signs that China's economy continues to weaken are another worry.
On the local front, banking stocks lost ground.
DBS was down 10 cents at S$14.30, OCBC shed five cents to $9.19 and UOB dipped seven cents to S$19.02. The losses in the three counters shaved 4.26 points off the Straits Times Index.
Commodities firm Olam International fell 2.5 cents or 1.3 per cent to S$1.885. It had announced plans to raise S$250 million by selling one-year notes with a 2.5 per cent fixed rate.
Keppel Land shed two cents to S$3.34 while City Developments fell seven cents to S$11.45.
The falls were likely in response to a new government rule restricting the number of flats in a development, a move aimed at curbing the proliferation of shoebox apartments.
GSH Corp rose 0.8 cent or 8.6 per cent to 10.1 cents after the consumer goods distributor revealed plans to acquire a 60 per cent stake in a property development firm in China for 314.9 million yuan (US$50 million).
The firm also received the nod from the Singapore Exchange to be removed from the bourse's watch list effective yesterday, after meeting profit and market capitalisation requirements.
LionGold closed unchanged at S$1.245 after it announced that it has terminated a deal to acquire Hellyer Mill Operations from Australian-listed Bass Metals after certain conditions precedent were not met.