Singapore's STI Slumps as US Labor Strength Clouds Rate Outlook

The Singapore stock market extended its losing streak into a second consecutive session, with the Straits Times Index (STI) shedding over 85 points, or 2.2%, to close at 3,801.56. The index traded between 3,785.68 and 3,843.35 during the session, reflecting heightened volatility. The downturn was catalyzed by strong non-farm payroll data from the United States, which has sparked investor concerns that the Federal Reserve may maintain higher interest rates for longer or slow the pace of planned reductions. This sentiment triggered a synchronized decline across major Wall Street indices, including the Dow, NASDAQ, and S&P 500, all of which fell approximately 1.6%. In Singapore, the sell-off was widespread across multiple sectors. SembCorp Industries and Yangzijiang Shipbuilding led the losses, both plunging over 3.5%. Major financial institutions were also hit, with OCBC dropping 2.29% and DBS Group falling 1.93%. Other notable declines included Keppel Ltd, which tanked 2.59%, and Mapletree Pan Asia Commercial Trust, which retreated 1.64%. Amidst the equity slump, energy markets saw a boost. West Texas Intermediate (WTI) crude futures climbed 3.6% to settle at $76.57 per barrel, marking the highest settlement in three months. This surge followed the Biden Administration's decision to impose additional sanctions on Russian oil exports. Market participants anticipate continued pressure on Asian bourses as they react to the bleak lead from US markets and the evolving interest rate trajectory.