STI plunges 1.4% over mixed trading as investors assess SVB’s downfall

Singapore stocks reportedly declined on Monday amidst volatile trade throughout the region, as investors continued to be cautious following the sudden collapse of the Silicon Valley Bank (SVB) in the United States.

With the exception of four counters, the benchmark Straits Times Index (STI) lost 1.4%, or 45.06 points, to conclude the day at 3,132.37.

Keppel Corp, which fell 2.6% to close at $5.32, was the top STI decliner on Monday. In the meantime, Emperador’s stock increased 2% to close around 51 cents, capping the day as the best performer on the index.

It has also been reported that after 1.7 billion shares worth $1.3 billion changed ownership, there were 365 more losers than winners in the overall market.

Apparently, regional banks UOB, DBS, and OCBC were the three leading most heavily traded shares in terms of value, with over $400 million’s worth of their shares trading hands.

On Monday, the counters dipped between 1.4% and 1.7%.

Losses in Japan and Australia, where important indexes dropped between 0.5% and 1.1%, were mirrored by losses in Singapore.

Key benchmarks in South Korea, Hong Kong, as well as Shanghai, however, concluded with gains ranging from 0.7% to 1.9% as a result of the weekend intervention by U.S. regulators to boost confidence in the banking sector.

Sailesh K. Jha, RHB’s group chief economist as well as market research head, stated that foreign exchange, equities, as well as bonds imply that markets are pricing in individual risks from SVB, rather than a systemic consequence, in Asia trade today as well as the United States close on Friday.

According to Jha, this is how marketplaces initially read these types of shocks.

In addition to recent actions announced by the U.S. government, Jha pointed out that the U.S. Federal Reserve still has further instruments for injecting liquidity at its disposal.

Jha believes a systemic collapse on international markets from SVB is a low-probability scenario threat, and there could be plenty of chances to boost risky asset exposure in the next weeks.

Source credit: https://www.straitstimes.com/business/sti-falls-14-amid-mixed-asian-trading-as-investors-weigh-svb-collapse