Cautious investors with an eye on the progress of trade talks between the United States and China stayed on the sidelines and let Singapore shares head into the week downcast yesterday.
The Straits Times Index (STI) slipped steadily over the session to close at 3,143.24, lower by 0.52 per cent or 16.44 points. Losers outnumbered gainers 230 to 135, or about two stocks down for every one up.
It was a quiet start to the week, with 744.74 million shares worth $736.12 million changing hands.
"Markets tend to get themselves tied up in knots chasing headlines and by the week's end, one tends to find that playing the range or staying out altogether was probably the best strategy," said Mr Jeffrey Halley, an Asia-Pacific senior market analyst at Oanda.
China's Ministry of Commerce said over the weekend that economic and trade teams from the US and China held "constructive" discussions in Washington, and that both sides agreed to stay in contact.
But the Chinese delegation later cancelled a visit to farms in Montana and Beijing officials headed back to China earlier than planned, reviving worries over whether a trade deal could be reached soon.
"Markets are walking on a tightrope now, with the fundamental outlook continuing to deteriorate globally," said CMC Markets analyst Margaret Yang.
Financial stocks dragged the local bourse, with declines led by heavyweight index constituents DBS Bank and United Overseas Bank (UOB).
Some Jardine stocks also contributed to the slump. For instance, Jardine Cycle & Carriage finished 1.43 per cent lower at $30.43.
Jardine Strategic Holdings also saw losses as the counter closed at US$31.59, shedding 0.28 per cent.
DBS ended the day at $24.91, down 0.95 per cent or $0.24, while UOB pared 0.78 per cent or $0.20 to close at $25.56.
Singtel was one of the most active index stocks yesterday, with more than 9 million shares traded. It closed unchanged at $3.17.
Another telco, StarHub, closed at $1.33, up 0.76 per cent or $0.01 on trade of close to 1.8 million shares.
Meanwhile, Jardine-linked Dairy Farm added 2.41 per cent or US$0.16 to close at US$6.81 - one of the bourse's top gainers yesterday.
But RHB Research Institute is staying cautious on the outlook for Dairy Farm's earnings, given the ongoing protests in Hong Kong.
It estimated that about 70 per cent of the retailer's FY2018 operating profit was derived from the city.
