Singapore shares extend losses as Covid-19 contagion fears persist
27 Feb 2020 18:25
By Navin Sregantan
WITH little positive news on the Covid-19 front, Singapore equities extended losses on Thursday.
The fluidity of the situation has kept investors busy trying to price in the economic impact of the outbreak, which is already showing signs of establishing a foothold in Europe and the Middle East.
In Singapore, the Straits Times Index (STI) slipped by more than 1 per cent in the afternoon but staged a rebound after the 3,100 support level was breached.
While not quite the intraday V-shaped recovery optimists would hope for, the blue-chip index still clawed back losses to finish 5.82 points or 0.2 per cent lower at 3,111.70.
"The STI should find good support around 3,076-3,092. It is extremely unlikely that the index goes below 3,040 - the intraday low last seen on Aug 29, 2019 - on a sustained basis," remisier Ernest Lim told The Business Times.
Elsewhere in the Asia-Pacific, the slide from equity benchmarks in Australia, South Korea and Taiwan continued. On the other hand, China and Hong Kong were up on hopes of further stimulus and fewer virus deaths there. Malaysia also closed higher.
With markets still jittery, Oanda Asia-Pacific senior market analyst Jeffrey Halley said: "(The) coronavirus will continue to dominate equity sentiment, and one can't help but feel that we are still nearer the beginning than the end. Against that background, equity rallies are likely to be there to sell."
Trading volume in Singapore was 1.82 billion securities, 54 per cent above the 2019 daily average, but total turnover came to S$1.66 billion, 56 per cent over last year's intraday mean.
Across the broader market, decliners beat advancers 277 to 178. Of the STI's 30 components, 21 ended in the red.
Tech manufacturers were among the bright spots. AEM Holdings advanced S$0.07 or 3.2 per cent to S$2.24. Analysts at CGS-CIMB, DBS Group Research and Maybank Kim Eng upgraded their earnings forecasts for the test handler following a record profit and revenue performance in FY2019.
They believe AEM is poised for further growth on strong sales to key customer Intel, alongside the recovery in the semiconductor sector.
Other semiconductor stocks that ended higher include Frencken Group (up 1.5 Singapore cents or 1.8 per cent to 86.5 cents) and UMS Holdings (up S$0.02 or 2.1 per cent to S$0.96).
Among property listings, shares in PropNex edged up 0.5 Singapore cent or 0.9 per cent to 55.5 cents after Q4 net profit rose more than four times to S$8.2 million due to better commission income.
Fellow real estate agency APAC Realty, which reported better Q4 earnings on Monday due to higher brokerage income, closed unchanged at 48.5 Singapore cents. RHB Research analyst Vijay Natarajan said he expects further recovery in both primary and secondary residential property markets provided the Covid-19 outbreak is a short-term issue.
Glove maker Riverstone Holdings dipped S$0.01 or 0.9 per cent to S$1.04. Research houses remain bullish on their FY2020 outlook for Riverstone, which is set to benefit from strong demand for healthcare and cleanroom gloves amid the virus outbreak.
Source: Business Times Breaking News
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