Singapore shares close 0.3% lower on directionless trading

THE Singapore bourse's key Straits Times Index fell 6.45 points or 0.26 per cent to 2,504.76 on Tuesday, as prices by and large drifted to and fro on directionless auto pilot.

Lacklustre trading volumes underpinned stubborn caution that was led by worries over the global economy and the growing US-China spat, while the generally uneventful atmosphere was partly owing to overnight calm - the US and Canada were enjoying holidays - and a data vacuum.

To some extent, Brexit news made up for the lull, with the British pound failing to bounce back from Monday's losses after Prime Minister Boris Johnson threatened to walk away from trade-deal talks with the European Union, which renewed hard-Brexit fears.

All the same, there has been some growing optimism of late. In a recent report, Morgan Stanley said a V-shaped recovery is playing out faster than envisaged and that it expected a faster return to pre-Covid-19 output by early Q420 for the global-market economies and Q321 for the developed-market economies.

"The outlook for Covid-19's impact on the economy has changed dramatically, with most large economies able to lift economic activity to much higher levels despite the ongoing virus spread," said the bank, adding that "policy-makers continue to provide aggressive support as there are no serious moral hazard concerns this time".

All the other major Asian bourses posted gains on close from Japan, Hong Kong, China, Taiwan, South Korea to Australia and Malaysia.

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In Singapore, trading volume on the Singapore market totalled 1.3 billion worth S$943 million from Monday's 1.32 billion shares worth S$780.8 million.

Losses in the market's barometer was led by Singapore's three banking stalwarts, whose falls collectively shaved 3.5 index points off the STI. Among the STI constituents, eight counters closed up, and 18, down.

Sembcorp Marine was one of the top 10 active counters for the day, with 24 million shares worth S$4.7 million done. The stock fell 0.6 Singapore cent or 3 per cent to 19.3 Singapore cents.

On Monday, it announced that its rights issue was undersubscribed and that Temasek Holdings would mop up the undersubscribed portion as it had earlier agreed to do.

Raffles Education Corp jumped 3.6 Singapore cents or 32 per cent to finish at 15 Singapore cents. The stock had risen by as much as 39 per cent on Tuesday. When the Singapore Exchange queried these unusual price movements, the private education provider said it was not aware of any explanation for the unusual trading activity.