RTTNews - The Singapore stock market has finished lower now in four straight sessions, ahead of Monday's market holiday for National Day - shedding more than 130 points or 5 percent in the process. The Straits Times Index fell through the 2,550-point plateau - and while the day's cues are weak, the market may open higher on Tuesday as it catches up on some positive momentum from over the weekend.
The global forecast for the Asian markets is flat with a negative bias - particularly as investors may look to consolidate their positions after strong gains in the previous trading day. Commodities could see significant selling pressure, along with properties and airlines. The European markets were mostly lower, while the U.S. bourses ended slightly in negative territory - and the Asian markets are tipped also to move to the downside.
The STI finished sharply lower on Friday, thanks to heavy losses among the financials. For the day, the index retreated 52.15 points or 2 percent to close at 2,549.35 after trading between 2,542.34 and 2,596.32. There were 427 decliners and 120 gainers.
Among the decliners, DBS lost 3.5 percent, while Oversea-Chinese Banking Corp slid 2 percent and United Overseas Bank was 0.4 percent lower.
The lead from Wall Street has a touch of downside as stocks posted modest losses on Monday with traders cashing in on recent gains amid a lack of significant moves. The major averages all finished in negative territory, kicking off the week on a sour note. The decline came ahead of some key economic reports on tap for this week, including data on retail sales, industrial production and weekly jobless claims.
Further, the Federal Open Market Committee will make its interest rate announcement on Wednesday, with the key fed funds rate expected to remain unchanged amid a challenging economic environment.
On the corporate front, Freddie Mac (FRE) said late Friday that it no longer needs government aid, as the mortgage lender posted a positive net worth. Benefiting from accounting adjustments and gains, Freddie Mac reported a second quarter profit of $821 million on a notable increase in revenues to $7.47 billion from last year's $1.59 billion.
Warren Buffett-owned Berkshire Hathaway (BRKA) reported a 14 percent increase in second quarter earnings, fueled by gains from derivatives trading, which soared to $1.53 billion from $453 million in the second quarter of last year. The firm earned $1,147 per share, while Wall Street analysts expected the company to earn $1,238 per share for the quarter.
Microsoft (MSFT), which recently struck a ten-year deal with Yahoo (YHOO) to share search engine technology and ad revenue, announced an agreement with French ad company Publicis to sell its Razorfish digital advertising unit.
The major averages regained some ground going into the close of trading, although they remained stuck in the red. The Dow closed down by 32.12 points or 0.3 percent at 9,337.95, the NASDAQ slipped by 8.01 points or 0.4 percent to 1,992.24 and the S&P 500 fell by 3.38 points or 0.3 percent to 1,007.10.
In economic news, Singapore will on Tuesday provide gross domestic product numbers for the second quarter. Analysts are predicting a 4 percent contraction on year following the 3.7 annual decline in the previous three months. On a quarterly basis, GDP is seen higher by 19.2 percent after the 20.4 percent expansion in the first quarter.
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