SINGAPORE (THE BUSINESS TIMES) – Asian stocks mostly fell on Monday, tracking losses on Wall Street last Friday amid concerns that the US Federal Reserve may raise interest rates sooner than expected.
The Straits Times Index (STI) fell 0.8 per cent to 3,117.87.
Elsewhere in the region, Japan’s Nikkei 225 fell 3.3 per cent, while the ASX 200 in Australia dropped 1.8 per cent. Both the KLCI in Malaysia and Hong Kong’s Hang Seng Index slipped 1.1 per cent.
The losses follow comments last Friday by Mr James Bullard, president of the St Louis Federal Reserve, who said he sees rate increases happening as early as next year to contain inflation.
Oanda senior market analyst Jeffrey Halley noted that the major casualty has been the global reflation and cyclical recovery trade, but said the dip in stocks appears to be corrective. “I suspect the falls are primarily a function of financial markets being very long the global recovery trade. Interest rates are going nowhere fast, and the world’s central banks have not closed the liquidity spigots,” he added.
On the local bourse, losers outnumbered gainers 327 to 188 after 1.79 billion shares worth $1.41 billion changed hands.
MC Payment, currently in a dispute with its controlling shareholder, was among the top active counters, with 69.4 million shares worth $39.2 million changing hands. The counter rose 17 per cent to 58.5 cents, extending last Friday’s 51.5 per cent gain after the firm said it received a letter of intent from Indonesia-based payments and remittance company Dompet Harapan Bangsa for an equity stake.
Hongkong Land shares led the losses on the STI, falling 3 per cent to close at US$4.88. Keppel DC Reit was the top index performer on Monday, with its units climbing 0.8 per cent to close at $2.57.