FTSE STI closed 3,398.26 down 6.31 points or -0.19% with a total volume of 1.17b and a total value of S$1.18b. Total number of advance vs decline was 174 vs 250. Of the 30 component index stocks, 7 closed positive, 3 unchanged and 20 in the red. The top 5 gainer component stocks were :-
1. Jardine C&C +0.610
2. StarHub +0.050
3. OCBC +0.040
4. Ascendas Reit +0.030
5. ThaiBev +0.015
The top 5 loser component stocks were :-
1. JMH USD -0.820
2. UOB -0.090
3. Noble -0.065
4. SIA -0.060
5. JSH USD -0.040
5. HongkongLand USD -0.040
US markets rebounded with a gain of at least 0.3% but Asian bourses were unable to track that performance mostly closing in the red with Nikkei -0.67%, SSE -0.46% and HSI -0.94%. STI failed to hold on to the gain and close -0.19% in typical daily volume and value with only 7 of the 30 index stocks posted gain.
While the positive closing of US markets might have suggested that investors were putting aside the fear of sooner than expected rate hike, the actual fact was US markets being popped up by selective stocks like Apple. It was another data drive day for Asian markets as China released its February CPI coming in at +1.4% higher than expectation of +0.9% and +0.8% in January. That sudden rise could be due to the CNY in February. Nevertheless, investors still reacting to that bearishly as a rising inflation could mean PBOC might be cautious in doing more monetary easing.
STI was unable to maintain the gain in the early part of the day due to the weakness in regional markets. The interest rate hike factor still in play as most of the property and S-Reits were being sold down as they are the outcome interest rate sensitive stocks. Any interest rate hike will mean increasing in borrowing cost and given the current property markets still in the decline mode due to the cooling measures, the concern will be their profit margin. However, not all property and S-Reits stocks should be generalized as it will have to depend on the strength of their respective balance sheet. The selling could present bargain opportunity for those with strong balance sheet as property market should be seeing a bottom and potentially easing of cooling measures later this year. There is also a threshold in which S-Reit price is at attractive level, watch out for that.
