RTTNews - The Singapore stock market has finished lower now in three consecutive sessions, giving up more than 80 points or 3.7 percent in the process. The Straits Times Index is falling towards support at 2,250 points, and analysts predict that the market could test that level at the opening of trade on Tuesday.
The global forecast for the Asian markets is effectively flat with a touch of downside, ahead of the start of earnings season later this week. Technology shares and commodities are expected to see selling pressure, offsetting projected strength among the properties and chemical stocks. The European markets ended sharply lower, while the U.S. bourses finished in mixed fashion but near the unchanged line - and the Asian markets are predicted to follow the latter lead.
The STI finished sharply lower on Monday, dragged to the downside by weakness among the financials, telecoms and property stocks.
For the day, the index plummeted 33.66 points or 1.46 percent to close at 2,266.09 after trading between 2,261.29 and 2,293.68. Volume was 1.26 billion shares worth 977 million Singapore dollars.
Among the decliners, Singapore Telecommunications lost 3 percent, DBS Group Holding shed 2.07 percent and CapitaLand ended 1.94 percent lower, while Singapore Airlines, Keppel Corp, United Overseas Bank, Oversea Chinese-Banking Corp, Keppel Land and City Developments also finished lower.
Wall Street offers a mixed lead as stocks were able to shed most of their losses in late trading on Monday after a sharp move to the downside in early going. While the Dow and S&P 500 finished modestly higher, the tech-heavy NASDAQ closed on the downside.
On the economic front, traders largely shrugged off a report from the Institute for Supply Management showing that activity in the service sector contracted for the ninth consecutive month in June, although at a slower pace than economists had been expecting. The ISM said its index of activity in the service sector rose to 47.0 in June from 44.0 in May, but a reading below 50 indicates a contraction. Economists had been expecting the index to come in at 46.0.
On the corporate front, food and beverage giant PepsiCo Inc. (PEP), together with its bottling partner Pepsi Bottling Group Inc. (PBG), announced plans to invest $1 billion in Russia over three years. Meanwhile, EMC (EMC) raised its all-cash offer to acquire Data Domain (DDUP) to $33.50 per share for a total enterprise value of about $2.1 billion. EMC is competing with NetApp (NTAP) to acquire Data Domain.
Despite the major indices all moving higher going into the close, the NASDAQ was unable to break into positive territory. Subsequently, the NASDAQ finished down by 9.12 points or 0.5 percent at 1,787.40, while the Dow closed up by 44.13 points or 0.5 percent at 8,324.87 and the S&P 500 rose by 2.30 or 0.3 percent to 898.72.
In economic news, Singapore will on Tuesday announce FX reserves data for June, with forecasts predicting a surplus of $172.1 billion, down from $171.76 billion in the previous month.
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