Investors are waiting for U.S. economic data, Asian stocks retreat, and the Hang Seng Index closed down 0.39% | Lianhe Zaobao
The Asia-Pacific stock market generally fell as investors reassessed the market environment. The FTSE Straits Times Index closed at 4273.86 points, down 0.39%. The total trading volume was 1.81 billion shares, with a turnover of 1.46 billion yuan. There were 264 stocks that rose and 280 stocks that fell. YZJ Shipbldg SGD had the largest increase, closing at 3.32 yuan; Hongkong Land had the largest decrease, closing at 6.3 USD. The market is waiting for the upcoming inflation and employment data to be released by the United States, and investor sentiment is becoming cautious
Investors are reassessing the market environment following the Federal Reserve's interest rate cut, coupled with the market awaiting the upcoming inflation and employment data from the United States. The Asia-Pacific stock markets generally retreated on Thursday (September 25). The FTSE Straits Times Index closed at 4273.86 points, down 16.54 points or 0.39%.
The Singapore stock market recorded a total trading volume of 1.81 billion shares on Thursday, with a total turnover of SGD 1.46 billion. There were 264 gainers and 280 decliners.
Among the main constituents of the index, eight stocks rose, two remained unchanged, and 20 fell. The biggest gainer was YZJ Shipbldg SGD, which rose 0.91% to close at SGD 3.32. The largest decline was seen in Hongkong Land, which closed at USD 6.3, down 3.37%.
Tan Yingying, Chief Equity Broker at Phillip Securities, pointed out in an interview with Lianhe Zaobao that, with some time until the earnings season, the market needs economic data to provide guidance in the absence of profit information.
"However, the recent new employment visa policy and crackdown on illegal foreign workers by the Trump administration have created uncertainty for the local labor market and investments. The upcoming economic data on employment and inflation may not show significant improvement."
Federal Reserve Chairman Jerome Powell indicated this week that the U.S. stock market is "fairly valued" and warned that "there is no risk-free path for interest rates," leading to a more cautious investment sentiment. This has also caused a slowdown in the rally of several tech stocks. The Asia-Pacific stock markets closed generally lower, with Hong Kong down 0.13%, Shanghai down 0.01%, Tokyo up 0.27%, and Seoul down 0.03%.
Tan Yingying noted that issues arising from tariffs may begin to manifest early next year. Cutting interest rates without a clear downward trend in inflation may only lead to short-term speculative phenomena.
However, she believes that the U.S. tech sector will remain elevated in the short term, but investors may choose to diversify their investments, which could boost the valuations of Asian tech stocks that are still relatively low. "The recent pullback in the Singapore stock market after a rise likely indicates that funds are exiting for local arbitrage and subsequently entering the tech stock sectors in China and other regions."
New Indices Stimulate Small-Cap Market, Investors Should Still Pay Attention to Fundamentals
The Singapore Exchange has recently launched two new indices to enhance market awareness and attention to stocks outside the constituents of the Straits Times Index. Additionally, the local initial public offering (IPO) market is also experiencing a revival, with a new real estate investment trust receiving a warm response, leading many to believe that the local stock market is entering a springtime phase.
In this regard, Li Cailian, General Manager of OCBC Investment Research, believes that the new indices provide a good opportunity to attract investor interest to stocks outside the constituents of the Straits Times Index and blue-chip stocks, which can further enhance their liquidity and valuations.
However, she cautioned that the continued revitalization of the Singapore stock market may lead to valuations of small-cap stocks exceeding historical averages, but investors should remain cautious. "Currently, it is unclear whether this round of valuation re-evaluation is sustainable. The risk-reward ratio of certain individual stocks has begun to become unattractive, especially those whose stock prices have significantly outpaced their fundamentals amid an uncertain macroeconomic outlook." Tan Yingying believes that if the relevant stock indices can be configured into exchange-traded funds (ETFs), it may increase trading volume to boost these small and medium-sized stocks.
Wilmar International Bribery Case Acquittal Overturned, 900 Million Yuan Bail May Be Confiscated
In individual stock news, the Indonesian Supreme Court on Thursday overturned the acquittal of Wilmar International in a bribery case. The case involves bribery by its five subsidiaries in Indonesia to obtain export permits during the edible oil shortage from July to December 2021.
Wilmar International had previously deposited over 900 million yuan in bail with the local Attorney General's Office. If the case is lost, the bail may be fully or partially confiscated. Wilmar International closed at 2.89 yuan, down 0.69%.
Seatrium announced before the market opened that it has signed a memorandum of understanding with Cochin Shipyard (CSL), India's largest shipbuilding and ship repair company, to strengthen offshore business cooperation in India and Asia.
According to the announcement, Seatrium's subsidiary SOT specializes in engineering technology, specialized equipment, and offshore solutions, while CSL has extensive experience in infrastructure, manufacturing facilities, and ship repair. Seatrium closed at 2.42 yuan, up 0.83%.
CapitaLand India Trust announced during trading that it will sell two assets located in Chennai, India, CyberVale, and CyberPearl in Hyderabad to an unrelated third party for a transaction amount of 11.031 billion Indian Rupees (approximately 161.7 million Singapore Dollars).
This is the first asset divestment by the trust since its listing in 2007, with net proceeds from the transaction expected to be 10.828 billion Indian Rupees. The trust closed at 1.17 yuan, unchanged
