Share up weighed by CapitaMalls Asia; 3,180 support eyed

Singapore shares were slightly up by midday on Monday, as investors remained cautious ahead of the U.S. Federal Reserve meeting this week and on concerns that it may tighten monetary policy.

Singapore’s shopping mall owner CapitaMalls Asia (CMAL.SI) fell as much as 3.2% after it reported worse-than-expected quarterly earnings, weighing on the broader index, traders said.

By the midday break, the Straits Times Index (STI) <.FTSTI> was up 2.53 points at 3,197.15. The total value of shares traded in the morning session was $761.4 million, down from $1.12 billion on Friday.

 

“Market sentiment is still cautious as expectation of more cooling measures from China and potential change in tone during the FOMC meeting on Wednesday may cause the market to dip,” said Ng Kian Teck, an analyst at SIAS Research.

 

Ng said he expects the STI to trade between 3,180-3,220 in the afternoon.

CapitaMalls shares were 2.2% lower at $1.80 after it said its net profit for the first quarter fell 24% to $49.1 million, weighed by a reduction in contributions from three malls that were divested to its real estate investment trusts.

 

“Their earnings came in below consensus’ estimates. Moreover, there may be some fund outflows from CapitaMalls and into the new listing of Perennial,” said an analyst.  

 

Perennial China Retail Trust, which owns shopping mall assets in China, is relaunching its $840 million Singapore initial public offering in May.

 

Shipbuilder STX OSV (STXO.SI) fell 3.3% to $1.18 on news that its parent is mulling selling an additional stake in the firm, traders said.

 

South Korea’s STX Group said it was considering selling an additional 20% stake in STX OSV, worth around 260 billion Korean won in May or June.

 

“The market is reacting to news that its parent may sell a stake in the firm and investors are concerned about whether the pricing of the share sale will be done at a discount,” said an analyst.

 

Hutchison Port Holdings Trust (HPHT)(HPHT.SI), which owns port assets, rose 2% to US$0.96 ($1.19) after several brokerages initiated coverage of the firm with a buy rating, traders said.