SINGAPORE stocks slipped into negative territory on Friday (Dec 13) morning, after China deepens its stimulus drive in a bid to brace for trade tensions with the US.
Market Update
As at 9.01 am, the Straits Times Index (STI) fell 5.72 points or 0.2 per cent to 3,803.55. Across the broader market, losers outnumbered gainers 40 to 29, with 21.4 million securities worth S$34.8 million changing hands.
Top Traded Stocks
Genting Singapore was the most actively traded counter in terms of volume, rising 1.3 per cent or S$0.01 to S$0.78, with 2.9 million shares transacted. Shares of Thai Beverage were briskly traded as well, declining 0.9 per cent or S$0.005 to S$0.565. Units of Mapletree Logistics Trust also dipped by 0.8 per cent or S$0.01 to S$1.26.
Banking Stocks
Banking stocks were mixed at open. UOB was down 0.6 per cent or S$0.22 at S$37.03, while OCBC declined by 0.2 per cent or S$0.03 to S$16.77. DBS was trading flat at S$43.80.
Global Markets
Hong Kong and China stocks bounced strongly on Thursday. In addition, except a fall of 1.4 per cent or more on Friday, blue-chip Chinese stocks will clock their third weekly rise in a row – a winning streak not witnessed since May.
Global Market Trends
China recently concluded its Central Economic Work Conference on Thursday, and pledged to increase the budget deficit, issue more debt and loosen monetary policy to maintain a stable economic growth rate. This is to prepare for increased trade tensions with the US, with President-elect Donald Trump to come to power soon.
The Chinese yuan came under renewed pressure against the US dollar, inching 0.03 per cent lower at 7.2637 to the greenback after trading in a range of 7.2565 to 7.2677, with China considering weakening the yuan to tide through the risk of US trade tariffs.
Wall Street stocks fell on Thursday, after US wholesale inflation came in higher than expected at 0.4 per cent last month seasonally adjusted, up from 0.3 per cent in October. Markets however continue to bet that the US Federal Reserve will cut interest rates later this month, despite the country’s inflation report.
The tech-rich Nasdaq Composite Index dropped 0.7 per cent to 19,902.84, after closing above 20,000 for the first time on Wednesday. The Dow Jones Industrial Average also declined 0.5 per cent to 43,914.12, while the broad-based S&P 500 shed 0.5 per cent to 6,051.25.
European Markets
In Europe, stocks settled lower on Thursday, after the European Central Bank cut interest rates by 25 basis points as expected, and left the door open for further easing to support a struggling economy amid heightened political risks.
European Market Trends
The pan-European Stoxx 600 index closed a choppy session at 519.2 points, down 0.1 per cent, although rate-sensitive eurozone bank shares edged up 0.3 per cent.
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Conclusion
Singapore stocks slipped into negative territory on Friday, following China’s decision to deepen its stimulus drive in preparation for trade tensions with the US. Global markets were mixed, with Hong Kong and China stocks bouncing strongly, while US and European markets settled lower. The Chinese yuan came under pressure against the US dollar, and the tech-rich Nasdaq Composite Index dropped 0.7 per cent.
Frequently Asked Questions
Q: Why did Singapore stocks slip into negative territory?
A: Singapore stocks slipped into negative territory due to China’s decision to deepen its stimulus drive in preparation for trade tensions with the US.
Q: What happened in the global markets?
A: Global markets were mixed, with Hong Kong and China stocks bouncing strongly, while US and European markets settled lower.
Q: What is happening with the Chinese yuan?
A: The Chinese yuan came under pressure against the US dollar, inching 0.03 per cent lower at 7.2637 to the greenback.
