The Singapore stock market has finished lower now in three consecutive sessions, giving away more than 50 points or 3 percent along the way. The Straits Times Index is hanging on to support at 1,800 points, but analysts are not sanguine about the likelihood of the market holding that line at the opening of trade on Wednesday.
The global forecast for the Asian markets is fairly pessimistic as concerns over the spread of swine flu continue to weigh on investors. Some slightly better than expected economic data provides a bit of optimism, as does some mixed corporate news. The European markets ended sharply lower and the U.S. markets ended barely below the unchanged line, and the Asian markets are tipped to follow the latter lead.
The STI finished modestly lower on Tuesday, dragged to the downside by weakness among the properties and the telecoms - although the losses were limited by modest gains among the financial shares.
For the day, the index lost 10.20 points or 0.56 percent to close at 1,808.41 after trading between 1,791.45 and 1,827.84. Volume was 1,381.8 million shares worth 999.2 million Singapore dollars. There were 308 decliners and 169 gainers, with 775 stocks finishing unchanged.
Among the decliners, CapitaLand fell 1.6 percent, Singapore Telecom was down 0.4 percent, Cosco Corp lost 10.7 percent and Neptune Orient Lines closed down 9.4 percent, while Keppel Land, Keppel Corp and United Overseas Bank also ended in the red.
Bucking the trend, Singapore Airlines was up 0.2 percent, while DBS was up 0.1 percent and Oversea-Chinese Banking Corp ended up 0.9 percent.
The lead from Wall Street is virtually flat with a touch of downside as stocks showed a lack of direction throughout the trading day on Tuesday after failing to sustain an initial downward move. The major averages bounced back and forth across the unchanged line before eventually ending the session modestly lower. The choppy trading came as traders digested mixed economic and corporate news combined with continued concerns that the swine flu outbreak may become a pandemic.
In economic news, the Conference Board released a report earlier in the day showing that its consumer confidence index increased by much more than expected in April, reflecting a significant improvement in consumers' assessment of the short-term outlook. The report showed that the consumer confidence index jumped to 39.2 in April from an upwardly revised 26.9 in March. Economists had expected the index to increase to 29.7 from the 26.0 originally reported for the previous month.
Separately, a report from Standard and Poor's showed that the S&P/Case-Shiller 20-City Composite Home Price Index fell at an annual rate of 18.6 percent in February, a modest deceleration from the 19.0 percent drop in prices that was reported for January.
In other news, the Wall Street Journal reported that regulators are pushing Bank of America (BAC) and Citigroup (C) to raise more capital following early results of the government's stress test analysis, generating some concerns about the results of the tests. The Journal said that the capital shortfall amounts to billions of dollars at Bank of America. The report specified that executives at both banks are objecting to the preliminary findings from the government's examination.
Meanwhile, an increase in the number of confirmed cases of swine flu has led the World Health Organization to raise the level of its influenza pandemic alert to Phase 4. At the same time, the WHO does not recommend that countries close borders or restrict travel.
The major averages moved to the downside in the latter part of the trading day, ending the session just below the unchanged line. The Dow closed down 8.05 points or 0.1 percent at 8,016.95, the NASDAQ closed down 5.60 points or 0.3 percent at 1,673.81 and the S&P 500 closed down 2.35 points or 0.3 percent at 855.16.
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