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STI Snaps Gains on Weak US Jobs Data

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by Donavan Lim

Singapore shares snapped an eight-days winning streak to end lower in tandem with Asian bourses.

Weak US jobs data released on Friday – a mere 80, 000 jobs were created instead of the expected 100, 000 – sent equities in a downward spiral.

Further, a decline in Japanese machinery orders and remarks by Premier Wen over the weekend, that real-estate market curbs in place were a long-term policy, added selling pressure on the markets.

The benchmark STI sank to 2,929.08 Monday, down 49.47 points. The selling was broad-based with all sectors of the market in the red.

Property companies with exposure to China were among the worst performers. CapitaLand fell 3.0 per cent to close at S$2.89, while CapitaMall Trust lost 1.3 per cent to end at S$1.925. Hong Kong Land sank to US$5.88.

Commodities also fell as investors became risk adverse. Golden Agri-Resources declined 3.5 per cent to S$0.695 while Olam International dipped 2.7 per cent at S$1.835.

Oil-rig builders were not spared either. Sembcorp Marine was off 2.2 per cent to close at S$4.94 and Keppel Corp fell to S$10.72.

Even defensive counters were in the red. SingTel fell 1.5 per cent to S$3.31 and Suntec REIT fell to S$1.375.

Regionally, Asian bourses fell. The Nikkei 225 index closed at 8,896.88, losing 123.87points while the Hang Seng Index was off 372.55 points to end at 19,428.09.

With the reporting session kicking off, eyes will be on the major companies’ earnings.

“It will be intriguing to see what message we hear from companies over the next few weeks and there is clear risk for highly rated stocks that miss. But ultimately we suspect focus will switch back to the eurozone, policy response and any indications from macro data as to whether a second half recovery is likely or not,” said Justin Harper of IG Markets in Singapore.