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=ASIA MARKETS: Singapore Fall On China Economic Data, Malaysia Gains On Select Purchases

KUALA LUMPUR (Jul 16) -- Singapore shares fell on Monday as investors took cues from weak Asian markets amid concerns over slowing economic growth in China which is embroiled in a trade spat with the U.S. Malaysia ended positive.

The Straits Times Index closed 0.9% lower at 3232.79 led by selldown in financial services stocks. Meanwhile, the FBM KLCI edged 0.3% higher at 1726.67 thanks to a last-minute buying in select blue chips such as Petronas Chemicals Group that gained 2.9%.

“Concerns over the effect of the trade skirmish and China’s further deleveraging certainly tipped off Asian markets to the red,” said IG Asia Market Strategist Jingyi Pan. “While expectations are for growth to slow into the second half, the heightened sensitivity will likely be in place from now on.”

Most markets in Asia started the week in the red despite Wall Street’s Friday gains, following data showing China’s economy expanding 6.7% in the second quarter, the slowest pace since 2016. Industrial production in June slipped below expectations to 6% on year.

The Nikkei’s Asia300 index of prominent regional companies edged down 0.1%. Markets in Japan were shut for a public holiday.

Earlier this month, China and the U.S. imposed tariffs on $34 billion of each other’s goods. Washington has also since threatened to levy more tariffs on another $200 billion worth of Chinese goods.

“External factors are getting in the way of improving local investor sentiment,” said Muamalat Invest Chief Executive Mohd Faruk Abdul Karim. The slowdown in China has added to fears that the escalating trade tensions with the U.S. could spill over to exporting nations like Malaysia, he said.

Faruk said his fund is holding on to about 20% in cash in order to buy on dips in case of a sharp market correction. “I’m still cautious on the market outlook, but I’ve started selectively buying in, cherry-picking among beaten-down stocks, such as those in the construction sector.”

In Singapore, lenders led the fall as investors shrugged off an upbeat S&P report that said the city-state’s banks are “firing on all cylinders this year, propelled by expanding net interest margins.”

United Overseas Bank retreated 1.9% while DBS Group Holdings and Oversea-Chinese Banking Corp lost 1.4% each. Singapore Exchange fell 0.7%.

Weak oil prices continued to weigh on rigbuilders Keppel Corp and Sembcorp Industries, which fell 0.3% and 1.5% respectively. Malaysian oil-and-gas services firm Sapura Energy declined 1.7%.

Wilmar International, meanwhile, added 0.3%. The agri-business outfit on Friday said a unit has entered a joint venture agreement with SATS Food Services to incorporate a company that will build a central kitchen in Langfang, Hebei province.

In Malaysia, mobile network firm DiGi.Com added 2.6% after reporting a 7.1% rise in second-quarter net profit on the back of surging Internet service revenue. Rivals Maxis and Axiata Group rose 0.7% and 0.5%.

Bintai Kinden, a construction-and-engineering company, rallied 11.5% after the company secured a job worth 50.48 million ringgit ($12.46 million).

- By Alexander Winifred and Joannah Perez; alexander.winifred@nikkeinewsrise.com; +603-20267363
- Edited By Jason Ng
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