May 20, 2024


Savvy business masters

Singapore shares hit 10-year low over COVID-19 fears

SINGAPORE: Singapore’s stock market went into a steep slide on Friday (Mar 13) as fears over the COVID-19 pandemic deepened, joining a global rout that has seen shellshocked investors across the world tip into a “sell-everything mode”.

The benchmark Straits Times Index fell as much as 6.3 per cent to 2,510.88 during intra-day trading, Bloomberg data showed.

This is the lowest since Jul 24, 2009, when it touched 2,503.28.

“This is a volatile situation that is likely to last for some time,” Ms Pan Jingyi, market strategist at IG, told CNA.

“The fact of the matter is that the coronavirus gives a lot of uncertainty and although we have a lot of policy support, we will see a little bit more caution. I would recommend being a little more cautious at this point in time,” she added.

Property and financial counters were among the worst hit, with Mapletree Commercial Trust, City Developments Ltd, CapitaLand and DBS losing as much as 10.2 per cent, 7.6 per cent, 7.8 per cent and 6.5 per cent respectively.

READ: Changi Airport’s passenger traffic fell 32.8% in February amid COVID-19 outbreak

“It is worrisome and diving too fast,” said Mr Alvin Lee, 41, who holds stocks in Singapore and the US.

“With the current market situation it seems like everyone is selling. But it might be a good chance to buy some if you have spare cash,” he added.

Housewife Mrs Tan SL, 40, agreed: “Panic selling doesn’t do us good. Be rational. Time to buy good blue chip stocks.”

Singapore on Friday extended border restrictions to individuals with recent travel history to Italy, France, Spain and Germany. 

The new restrictions, which take effect at 11.59pm on Sunday, come after an increase in imported cases in Singapore, particularly of those with travel history to European countries, the Ministry of Health (MOH) said on Friday.

Additionally, with immediate effect, all visitors entering Singapore with fever or symptoms of respiratory illness will also be issued with a 14-day Stay-Home Notice, regardless of their travel history or the results of swab tests at the checkpoint.

The health ministry has also put in place additional social distancing measures, saying that all ticketed cultural, sports and entertainment events with 250 participants or more are to be deferred or cancelled.

READ:‘Situation in Singapore remains under control’: PM Lee’s COVID-19 address in full

Singapore had 187 confirmed cases of COVID-19 as of Thursday, of which 96 cases have recovered and been discharged from hospital.

Globally, about 134,530 people have been infected by the coronavirus across the world and 4,970 have died, according to a Reuters tally.

Singapore has said that it expects the COVID-19 outbreak to potentially extend past one year, with Prime Minister Lee Hsien Loong warning on Thursday that the country faces a “serious situation”, with a “possible spike” in new cases, more clusters and new waves of infection from other countries. 

However, the situation remains under control and Singapore will not raise its Disease Outbreak Response System Condition (DORSCON) level to Red, he also said.

READ: Ticketed events with 250 participants or more to be deferred or cancelled under COVID-19 social-distancing measures: MOH

The slide in Singapore’s stock market followed a global rout that saw US stocks plunge nearly 10 per cent overnight in their biggest one-day losses since the 1987 market crash.

“Global markets appear to have been tipped over into a sell-everything mode,” said Ms Pan in a market update.

“The message that the market is giving to us – with haven assets being sold off, a lot of alternative assets – suggest that sentiment is being hit quite badly,” Ms Pan told CNA separately. 

She said that she expects some form of stability to reach the markets in under two months.

“In terms of market stablisation … The wait for civilisation to reach the shores will take six to seven weeks,” she said.

READ: How China turned the tide on COVID-19

Mr Andrew Slimmon, head of applied equity advisors team at Morgan Stanley Investment Management, said that while it would be “naive not to concede a recession is a possibility”, it would be “highly unlikely”. 

“Don’t get swayed by the doom and gloomers. I think this health scare will be behind us by the summer, but more pain will come near-term and I would be patient on chasing incremental dollars into the market,” he said. 

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