Singapore market trends Thursday: Nikkei opens flat, China’s yuan steadies

Singapore five-dollar note Photo by Leslie Shaffer

Singapore’s shares will open trade on Thursday with a dearth of leads, with the U.S. market closed overnight and Japan’s Nikkei opening essentially flat, while U.S. President Trump issued yet another complaint about oil prices.

Singapore stocks to watch Thursday: SingTel, Mapletree Logistics, SATS, Spackman

U.S. markets were closed on Wednesday for the July 4 Independence Day holiday.

Japan’s Nikkei 225 index opened nearly flat, up just 0.03 percent.

The Straits Times Index ended Wednesday up 0.28 percent at 3244.89; July futures for the index were at 3235 on Wednesday and August futures were at 3204.

The Shanghai Composite had ended Wednesday down 1.0 percent at 2759.13, while the Hang Seng Index was off 1.06 percent on Wednesday at 28,241.67. China’s shares have tumbled to levels not seen since 2016 amid concerns over the U.S. trade war.

Trade War

China’s finance ministry said on Wednesday that the mainland will “absolutely not” fire the first shot, or levy the first tariffs, in a trade war with the U.S., according to a Reuters report.

Currencies

The dollar index, which measures the greenback against a basket of currencies, was at 94.51 at 7:48 A.M. SGT, off levels as high as 94.69 on Wednesday.

The 10-year U.S. Treasury bond yield was at 2.842 percent at 7:59 A.M. SGT, after trading as high as 2.888 percent on Tuesday; U.S. markets were closed on Wednesday. Bond yields move inversely to prices.

The dollar/yen was at 110.493 at 8:01 A.M. SGT after trading in a 110.25 to 110.60 range on Wednesday; it traded as high as 111.135 earlier in the week, according to DZHI data.

The euro/dollar was at 1.1660 at 8:03 A.M. SGT after trading in a 1.1628 to 1.1682 range on Wednesday, according to DZHI data.

The dollar/yuan was at 6.6289 at the close on Wednesday after trading as high as 6.7167 on Tuesday.

“The PBOC’s assurances that they are not using the yuan as a weapon in any currency wars have done little to calm equity markets but in foreign exchange, the dollar’s softer against everything except for the Turkish Lira,” Kit Juckes, macro strategist at Societe Generale, said in a note on Wednesday.

The Singapore dollar may have put a cap on some of its recent weakness. The dollar/sing was at 1.3649 at 8:06 A.M. SGT, off a high of 1.3745 earlier in the week.

Oil

Nymex WTI crude oil futures for August were up 0.03 percent at US$74.16 a barrel at 7:43 A.M. SGT, while ICE Brent crude futures for September were up 0.62 percent at US$78.24 at 1:29 A.M. SGT.

U.S. President Trump took to Twitter again on Thursday to complain about oil prices, saying “the OPEC monopoly” should “REDUCE PRICING NOW!” (sic). To be sure, OPEC is not a monopoly and it can only influence supply and not prices directly.

Trump noted that gas prices were up; U.S. gas prices typically rise during the summer months as road trips increase during school holidays.

Auto services company AAA said that the current average price of gasoline was US$2.866 a gallon, up from US$2.848 a week ago, but down from US$2.949 a month ago.

 

In a move that may eventually boost oil supply, the China Development Bank will give Venezuela a US$250 million direct investment to boost oil production, Venezuela’s finance minister said, according to a Reuters report.

World Cup

There were no World Cup games overnight. The next game is on Friday, between Uruguay and France.

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