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Singapore Stock Market Update

Singapore shares closed 1 percent lower Monday, weighed down by concerns about the outlook for the global economy and corporate earnings despite better-than- expected U.S. jobs numbers at the end of last week.

An unexpected drop in the U.S. unemployment rate to below 8 percent was overshadowed by concerns about the earnings season -- which kicks off with Alcoa Incorporated Tuesday.

SIAS Research said "the Straits Times Index could be flattish, with fluctuations of about 0.5 percent up or down, and we could see some profit-taking in the week" amid choppy trade. But the research house also added "this could be a good buying opportunity for those who have been sitting on the sidelines... The small- and mid-capitalization and the cyclical could be coming back into play. "

NRA Capital said "the Straits Times Index could be range-bound this week, between the 2,900 points and 3,100 points levels, although the bias is toward the downside after the recent rally," adding that expectations for Singapore to confirm its slippage into a technical recession Friday and a gloomy corporate earnings outlook has cast a pall over the market, translating to low trading volumes.

DBS Group Research said "we maintain our Straits Times Index 3, 200 points objective while noting that the climb will be gradual.

"Technically, near-term support is at 3,088 points with a firmer range at 3,035 points and 3,070 points should the Straits Times Index pullback."

The benchmark Straits Times Index fell 31.22 points to close at 3,076.65 points. Trading volume was 1.79 billion shares worth 1. 069 billion Singapore dollars. Decliners outnumbered advancers 350 to 117, while 491 stocks closed unchanged.

CapitaLand shed 3.3 percent to 3.19 Singapore dollars, while City Development Limited dropped 2.3 percent to 11.67 Singapore dollars.

The property developers were succumbed to profit-taking after Singapore regulators announced fresh steps to curb rising real-estate prices by capping all new home loans at 35 years' tenure, among other steps.

SIAS Research expects "some level of reaction to the news" but adds the steps are pre-emptive in nature and should not dull home prices significantly.

Suntec Real Estate Investment Trust inched down 0.3 percent to 1.525 Singapore dollars.

Maybank Kim Eng Research upgraded the trust to "buy" from "hold" and raised its target price to 1.66 Singapore dollars from 1.42 Singapore dollars, citing strong occupancy at its office assets and good progress in the upgrading works for its shopping mall and convention center.

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