Market Summary
Singapore shares closed higher on Wednesday (Nov 2) on late buying after spending all day underwater following overnight losses on Wall Street. Stronger-than-expected jobs data from the world’s largest economy dimmed some hope of a dovish pivot by the Federal Reserve at its latest meeting. The Straits Times Index (STI) advanced 10.63 points or 0.3 per cent to 3,141.13 to log its seventh straight day of gains. For much of the day however, it appeared as if its six-day rally had run out of steam as caution was thick in the air ahead of the Fed rate hike outcome. Japan posted losses, while most key bourses across the region from Hong Kong and China to Taiwan, Malaysia, South Korea and Australia logged gains. Market players have “relied heavily” on US labour market figures to show easing inflationary pressures, but with the stronger demand from a jump in job openings, the expectation for a pause on aggressive rate hikes in December has softened. This is because the robust numbers could provide the Fed with further ammunition to stay on a hawkish course, said Phillip Securities in a note on Wednesday. On the local bourse, some 1.55 billion securities worth S$1.19 billion were traded. Gainers outpaced losers, with 271 counters up and 216 down. Geo Energy Resources was the day’s fourth most active counter with some 25 million shares traded. The coal miner gained S$0.01 or 2.5 per cent to S$0.405, partly owing to interest on the counter following an announcement by Singapore-listed peer Golden Energy and Resources on Tuesday (Nov 1) that it was looking to restructure or exit the energy coal business.
Wall Street stocks finished sharply lower Wednesday after the Federal Reserve announced another big interest rate hike and signaled more increases ahead. Major US indices lost more than 1.5 per cent following a press conference with Fed Chair Jerome Powell that observers characterised as more hawkish than expected. Stocks had initially rallied after the Fed’s 1800 GMT statement, but gave back those gains during the press conference and fell further in the final hour of trading. The Dow Jones Industrial Average fell 1.6 per cent to 32,147.76. The broad-based S&P 500 dropped 2.5 per cent to 3,759.69, while the tech-rich Nasdaq Composite Index shed 3.4 per cent to 10,524.79. The US central bank, as expected, raised the benchmark borrowing rate by 0.75 percentage point. But markets cheered a tweak in the Fed’s language to the effect that the US central bank would assess the “cumulative” effect of its monetary policy moves. Investors viewed the statement as corroborating its hope that the Fed could undertake smaller hikes in December and at future meetings. But major indices tumbled into the red during the press conference when Powell said it was “very premature” to discuss pausing rate increases and that he didn’t think the body had “overtightened.” Among individual companies, Boeing gained 2.8 per cent as executives outlined a plan to return to financial strength in the 2025-26 timeframe after a lengthy slump due to the 737 MAX and Covid-19 crises. Airbnb sank 13.4 per cent as disappointment in the home-rental company’s fourth-quarter outlook spurred a selloff after earnings topped estimates.
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