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=ASIA MARKETS: Singapore Shares Post Steepest Single-Day Fall In Over 3 Years, Malaysia Slips Too

KUALA LUMPUR (Oct 11) -- Singapore’s stock benchmark Thursday suffered its steepest single-day fall in more than three years and Malaysia shares were also hurt by broad-based decline as overnight rout in U.S. markets spread to global equities.

The Straits Times Index ended 2.7% lower at 3047.39 as Golden Agri-Resources led 28 other constituents on the 30-stock Singapore index lower. The FBM KLCI closed down 1.5% at 1708.49 with Genting Malaysia being the biggest index loser with a 5.4% drop.

“The volatility is exacerbated by the divergence of U.S. and ex-U.S. markets, which was simply not sustainable,” said KGI Securities’ Head of Singapore Equities Research Joel Ng. “It could be a healthy correction for the U.S. markets.”

The Nikkei Asia300 Index of stocks outside Japan sank 4.1%, while Japan’s Nikkei 225 Average tumbled 3.9%. The Shanghai Composite plunged 5.2%, its worst loss in almost four years. Most regional currencies weakened against the dollar while Brent crude oil contracts slid more than 1.5%.

Overnight in the U.S., both the S&P 500 Index and the Dow Jones industrials suffered their worst single-day drop in eight months, while the technology-heavy Nasdaq composite fell 4.1%, the most in more than two years.

The yield on 10-year U.S. Treasury notes climbed toward recent multi-year highs intraday before giving up some gains by the end of trade.

“There’s concern of further drop in global market at a time when there’s not much optimism over the outlook for Malaysia’s economy and corporate earnings,” said Phillip Mutual Chief Strategist Phua Lee Kerk. “If the selloff in the U.S. persists, there’s no way Malaysia will buck the trend.”

Malaysian property developers tumbled after a state agency said the market is expected to remain soft through the next year due to glut in residential developments and vacant office space. Sime Darby Property slipped 3.6% and Eco World Development Group fell 3.5%.

Property transactions fell 2.4% in the first half of the year to 149,889 from a year earlier while transaction value fell 0.1% to 67.74 billion ringgit ($16.3 billion), according to the National Property Information Centre in Malaysia.

Plantation stocks also suffered. Kuala Lumpur Kepong fell 1% in Malaysia while Wilmar International was down 2.6% in Singapore. Stockpile in Malaysia, the world’s second-largest palm oil producer after Indonesia, rose to the highest level in eight months in September, Wednesday data showed.

In earnings news, Duty Free International lost 2.4% in Singapore after reporting a 12.6% decline on-year in second quarter net profit to 12.3 million ringgit ($3 million) while revenue slipped 21.8% to 114.4 million ringgit.

Top Glove Corp. rose 1.9% in Malaysia after posting a 7.5% rise in fourth-quarter net profit as sales growth outweighed higher tax expenses.

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