Thu, Oct 29, 2020 - 9:50 AM
SINGAPORE shares faltered at Thursday's open, following a weak lead from US and European markets overnight as pandemic fears rattle global markets. Investors' confidence was shaken amid rising worries about Covid-19 lockdowns, as France and Germany announced tough new restrictions and US cases continued to climb.
The poor showing on the Singapore bourse also comes after the Straits Times Index (STI) on Wednesday posted its third straight day of declines, as sentiments continued to be hurt by the Covid-19 surge, more global economic gloom and risks tied to the upcoming US election.
On Thursday, the benchmark STI slumped 19.26 points or 0.8 per cent to 2,464.22 as at 9.01am. Losers outpaced gainers 111 to 33, after 50.3 million securities worth S$61.9 million changed hands.
Among the index securities, the most heavily traded by volume was CapitaLand Mall Trust which dropped S$0.05 or 2.8 per cent to S$1.77, with 4.4 million units traded. Singtel lost S$0.01 or 0.5 per cent to S$2.08, with 2.1 million shares traded.
Amid a sea of red, banking stocks were down in early trade. UOB fell S$0.05 or 0.3 per cent to S$19.35, OCBC dropped S$0.01 or 0.1 per cent to S$8.54, while DBS tumbled S$0.27 or 1.3 per cent to S$20.63.
A digital currency exchange backed by Singapore's largest lender DBS is in the works, although the bank is still in the process of seeking regulatory approval. Industry observers say that if approved, the DBS Digital Exchange could be one of the world's first crypto exchanges backed by a traditional bank.
Other active securities included Mapletree Commercial Trust which declined S$0.07 or 3.8 per cent to S$1.78.
Over in the US, Wall Street stocks saw a sharp selloff on Wednesday. The Dow Jones Industrial Average slumped 3.4 per cent, or more than 940 points to 26,519.95. The tech-focused Nasdaq dived 3.7 per cent to 11,004.87 by the closing bell, while the broad-based S&P 500 shed 3.5 per cent to 3,271.03, in its worst rout in almost two months.
Said Stephen Innes, chief global markets strategist at Axi: "Global markets trembled Wednesday as a disquieting rise in coronavirus infections shattered investors' psyche and now pose a clear and present danger to a nestling economic recovery."
Likewise, European shares took a beating on Wednesday, as investors dumped riskier assets on fears of more lockdowns and uncertainty over a British trade deal with the European Union. London stocks slumped, with the bluechip FTSE 100 index hitting a six-month low to close 2.6 per cent lower.
In a market commentary on Thursday morning, Margaret Yang, a strategist at DailyFX, noted that Asia-Pacific stocks might be vulnerable to a deeper pullback following a bloodbath session on Wall Street due to the virus resurgence.
Elsewhere in Asia, Tokyo stocks opened lower on Thursday, extending falls on Wall Street on rising worries about the coronavirus pandemic. The benchmark Nikkei 225 index and the broader Topix index both dropped 0.9 per cent each in early trade.
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