Singapore market trends Tuesday: Jitters over US trade war set to dampen sentiment

Singapore CBDSingapore CBD

Singapore shares may face headwinds on Tuesday as concerns the U.S. will escalate its trade war on China continue to simmer and amid a lack of leads from Wall Street, which was closed for a holiday on Monday.

The U.S. trade war could escalate this week, with the public comment period on U.S. President Trump’s threat to put tariffs on an additional US$200 billion worth of Chinese imports ending on Thursday. Bloomberg News reported last week, citing six people familiar with the matter, that Trump wants to impose the tariffs as soon as the comment period ends. China will likely immediately retaliate.

Trump’s recent comments attacking Canada and threatening to scuttle a new NAFTA deal may also dampen sentiment.

“I fully expect an air of caution if not selling to permeate regional equity markets as the China and U.S. trade agenda focal point nears,” Stephen Innes, head of Asia Pacific trading at OANDA, said in a note on Tuesday.

To be sure, not all analysts agreed.

“The new week starts here, and we can see S&P 500 futures re-opening 0.2 percent higher, which, in turn, should support the Asia equity open,” Chris Weston, head of research at Pepperstone Group, said in a note on Tuesday.

The Straits Times Index ended Monday down 0.20 percent at 3207.20; September futures for the index were at 3207 on Monday, while October futures were at 3211.

Hong Kong’s Hang Seng Index ended Monday down 0.63 percent at 27,715.539, while China’s CSI 300 was down 0.38 percent at 3321.825.

U.S. markets were closed on Monday for the Labor Day holiday; futures for the three major indexes were a tad higher early Tuesday.

Currencies

The U.S. dollar index was at 95.16 at 8:07 A.M. SGT, broadly in line with levels on Monday after touching levels as low as 94.57 on Friday, according to ICE futures data.

The 10-year U.S. Treasury note yield was at 2.857 percent at 8:17 A.M. SGT, after touching levels as low as 2.832 percent in the Friday session, according to Tullett Prebon data.

The euro/dollar was at 1.1609 at 8:20 A.M. SGT after trading in a 1.1587 to 1.1628 range on Monday, according to DZHI data.

The dollar/yen was at 110.949 at 8:21 A.M. SGT after trading in a 110.837 to 111.189 range on Monday, according to DZHI data.

The dollar/yuan ended Monday at 6.8199 after trading in a 6.8145 to 6.8441 range on Monday, according to DZHI data.

The Singapore dollar remained on a weakening trend, with the dollar/Sing at 1.3729 at 8:23 A.M. SGT, after trading in a 1.3691 to 1.3732 range on Monday, according to DZHI data.

Oil

Nymex WTI crude oil futures for October were up 0.44 percent at US$70.11 a barrel at 7:59 A.M. SGT, while ICE Brent crude oil futures were up 0.66 percent at US$78.15 a barrel at 1:29 A.M. SGT, according to Bloomberg data.

Read more: Crude oil prices point higher in Asia on Atlantic hurricanes

 

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