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Straits Times 3,357.22 -20.74 -0.61%
Hang Seng 28,371.26 -394.14 -1.37%
Dow Jones 27,154.20 -68.80 -0.25%
Shanghai Composite 2,886.97 -37.23 -1.27%
Markets Halt Gains Amid Conflicts
By: Jimmy Ng
Articles (51) Profile

The last two weeks was a period pervaded with a series of disturbing unrests as news of conflicts around the world broke out one after another. Over the course of the past fortnight, deadly clashes from Israeli fire left 52 Palestinians dead and more than 2,400 wounded. Closer to home, Indonesia saw a series of suicide bombing in Surabaya while North Korea also threatened to cancel the Trump-Kim summit in Singapore.

In face of all the geopolitical tensions, Dow Jones Industrial Average halted its 8-days advance but the US bellwether still managed to post a 3.3 percent gain to end at 24,713.98 on 17 May 2018.

Over in Asia, China’s manufacturing activity grew more-than-expected in April as industrial output rose 7 percent from a year earlier. However, retail figures missed projections, growing only 9.4 percent compared to a 10-percent forecast. Meanwhile, fixed-asset investment also missed estimates, climbing only 7 percent compared to expectations of 7.4 percent.

Notwithstanding that, rising interbank rates continue to keep a lid on China and Hong Kong markets. In the last fortnight, Shanghai Composite Index and Hang Seng Index increased by 3.3 and 3.7 percent respectively.

In the 14th Malaysian general election, a decisive victory pulled off by the opposition coalition marked the end of Barisan Nasional’s 61-year rule of the country since independence. While we expected a negative knee-jerk reaction from the stock market because of the unexpected outcome, benchmark Kuala Lumpur Composite Index was quick to make a swift recovery to end 0.2 percent higher in the first trading day after the election even though it opened nearly 2.7 percent lower.

In the local market, telco giant Singtel’s share price plunged 2.6 percent on 15 May 2018 ahead of its results announcement, fuelled by worries that Optus’s growth may be insufficient in compensating for its Indian associate Bharti Airtel’s decline. Subsequently, Singtel reported a 19 percent drop in 4Q18 net profit affected by negative currency movements and lower associates’ contributions. Straits Times Index dipped slightly by 0.5 percent to 3,529.27.

On a side note, index provider MSCI announced that both Hutchison Port Holdings Trust and StarHub would be removed from the MSCI Singapore Index after its mid-year review. Electronics manufacturer Venture Corporation would be added into the list instead.

Equipped with a Bachelor in Mechanical Engineering and a few years of experience in the finance industry, Jimmy hopes to help investors gain deeper insights and make well-informed decisions by sharing his perspective.

Please click here for more information about this author.

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