Singapore shares closed lower Friday, tracking declines across most of the region after some weak U.S. economic data cast some more doubt over the strength of the recovery in the world's largest economy.
Stocks on Wall Street declined overnight following data showing that the number of Americans filing for unemployment benefits was higher than expected, a sign of lost momentum in the labor market. "In this climate, bad news trumps good news, especially when it is weaker data coming out of the world's biggest economy," said Justin Harper, market strategist at IG Markets Singapore.
Most blue chips in trade-dependent Singapore fell and the benchmark Straits Times Index closed 0.5%, or 13.73 points, lower at 2,994.48. For the week, the index inched up 0.2%. Technical analysts at CIMB noted that the index has been trading sideways in a wide range since February and is currently just above its key moving averages. Analysts at the bank said that the STI's 2,946 support level is worth watching. It said if the level fails to hold, chances of a bearish move rise.
Across the broader market however, gainers outnumbered losers 235 to 160 and traded volume more than doubled to 4.21 billion shares compared with 2.0 billion Thursday. The value of shares remained roughly flat at S$1.0 billion, indicating small-cap stocks were one of the main focuses of trade.
Among small-cap names that saw large volume trade, property developer HLH Group rose 14.3% to S$0.03 with over 389 million shares changing hands. The company Thursday responded to a disclosure request from the Singapore Exchange, saying that it was satisfied with its system of internal audit controls.
Companies in Singapore are currently releasing earnings for the January-March period, and last night blue chip conglomerate Keppel Corp. reported that its first-quarter net profit more than doubled from a year earlier to S$750.8 million. Keppel's stock ended down 1.4% at S$11.39, however, as the lumpy result was mainly due to accounting changes which affect earnings recognition from its property sales, while the company guided that such profits were unlikely to occur in the coming quarters.
Analysts said that the results, when stripping out the property gains, were largely in line with expectations and that Keppel's core offshore and marine business, which recorded a 9% gain in profits to S$235.3 million, continued to face strong prospects.
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