Singapore market trends Monday: Canada and US may be nearing trade deal

Singapore’s Orchard MRT stopSingapore’s Orchard MRT stop

Singapore’s shares may find few strong cues as trading opens on Monday, with Wall Street finishing flat on Friday and only small moves seen in early Asia trading.

On the humanitarian level, markets may take a back seat to the toll from a combination of a powerful earthquake and a tsunami, which struck Indonesia over the weekend. The death toll reportedly has crossed 1,200, in a disaster reminiscent of the 2004 earthquake and tsunami, which spread devastation across Southeast Asia.

On the U.S. trade war front, Canada and the U.S. are reportedly nearing a three-country deal to reform the NAFTA trade pact. Politico reported, citing people briefed on the matter that it contains “notable” changes to the diary segment, which had been a key sticking point, although the report said the concessions were similar to what had been negotiated for TPP, which U.S. President Trump had pulled out of.

Indexes

Japan’s Nikkei 225 index opened up just 0.10 percent, while South Korea’s Kospi ended up just 0.14 percent in early trade.

Singapore’s Straits Times Index ended Friday up 0.64 percent at 3257.05; October futures were at 3260 on Friday, while November and December futures were at 3264 and 3262 respectively.

Read more: Singapore stocks to watch Monday: Keppel, Ascendas REIT, CityDev, Spackman, Sembcorp Industries

Hong Kong’s Hang Seng Index ended up 0.26 percent at 27,788.52 on Friday, while China’s CSI 300 gained 1.04 percent to 3438.865.

Indonesia’s Jakarta Stock Exchange Composite Index was up 0.80 percent at 5976.55 on Friday.

The Dow Jones Industrial Average edged up 0.07 percent on Friday to 26,458.31, the Nasdaq Composite nudged up 0.06 percent to 8046.35 and the S&P 500 index shed 0.02 point to 2913.98. Futures for the indexes were solidly higher early on Monday.

Currencies

The U.S. dollar index was at 95.14 at 7:56 A.M. SGT after touching levels as high as 95.33 on Friday following a steady climb last week, according to ICE futures data.

The 10-year U.S. Treasury note yield was at 3.072 percent at 8:08 A.M. SGT, up from levels as low as 3.028 percent on Friday, according to Tullett Prebon data.

The euro/dollar was at 1.1608 at 8:10 A.M. SGT after trading in a 1.1569 to 1.1651 range on Friday and off a peak of 1.1815 last week, according to DZHI data.

Yen spikes after data

The dollar/yen was at 113.775 at 8:11 A.M. SGT after trading in a 113.29 to 113.712 range on Friday, with the pair having climbed steadily from early September, according to DZHI data. The pair spiked as high as 113.845 after the release of the Tankan data, which showed a surprise decline in business sentiment for the third quarter.

“The Tankan showed that business conditions continued to deteriorate in the third quarter, which supports our view that growth slowed last quarter. The headline index for large manufacturers dropped from 21 in the second quarter to 19 in the third quarter. This marked the third consecutive fall and was well below the Bloomberg median of 22,” Capital Economics said in a note early on Monday.

“More positively, firms raised their capital spending projections for the fiscal year that ends in March from 7.9 percent year-on-year to 8.5 percent year-on-year,” it added. While it noted that firms tend to become more optimistic as the fiscal year nears its end, “still, the latest round of projections is the most upbeat in 28 years and suggests that business investment will remain a key growth driver this year,” it said.

The dollar/yuan ended Friday at 6.8679 after trading in a 6.8650 to 6.8895 range on Friday, according to DZHI data.

The dollar/Singapore dollar was at 1.3673 at 8:12 A.M. SGT after trading in a 1.3655 to 1.3688 range on Friday, according to DZHI data.

The dollar/Indonesian rupiah ended Friday at 14,900 after trading in a 14,885 to 14,935 range, according to DZHI data.

Oil

Nymex WTI crude oil futures for November were up 0.30 percent at US$73.47 a barrel at 7:45 A.M. SGT, while ICE Brent crude oil futures for December were up 0.35 percent at US$83.02 a barrel at 7:45 a.m. SGT, according to Bloomberg data.

Read more: Crude oil seen higher in Asia on Saudi spare capacity concerns

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