Singapore shares extended a short losing streak on Thursday, with the Straits Times Index slipping marginally as investors weighed regional cues and softer oil prices. The STI finished just above the 5,720 mark, while global markets tilted higher after U.S. data reinforced expectations that interest-rate pressure may ease.
Key takeaways
- Price move: The Straits Times Index edged down to 5,720.05, a small decline after trading in a wide intraday range.
- Catalyst: U.S. producer-price data came in unexpectedly flat, adding to optimism about the rate outlook.
- Sector impact: Weakness in trusts and industrials was partially offset by gains in financials and properties.
- Macro signal: Fed expectations cooled, with odds of a September quarter-point hike falling according to CME’s FedWatch.
- Implication: Oil weakness and changing rate expectations are likely to remain key drivers for risk appetite and sector performance.
What moved Singapore stocks
The Straits Times Index finished barely lower on Thursday, down 0.70 points, or 0.01 percent, after moving between 5,667.09 and 5,732.39. The decline followed consecutive sessions of weakness, with the index having sunk nearly 35 points, or about 0.6 percent, over the prior two trading days.
Within the STI, losses in trusts and industrials dragged on the benchmark. Those declines were partly balanced by support from financials and properties, helping limit the day’s overall downside.
Why global markets turned supportive
Singapore’s trading tone was influenced by Wall Street’s direction. Major U.S. indexes opened higher, cooled at midday, and then rebounded into the close, ending in positive territory.
The strength followed a U.S. report from the Labor Department showing producer prices were flat in July, surprising economists and pointing to less upward pressure in upstream costs. The reaction built on a sequence of recent inflation and labor signals: Wednesday’s data indicated only a slight rise in consumer prices, while last Friday’s labor report showed an unexpected decrease in jobs. Taken together, the latest figures fueled market optimism that the Federal Reserve’s path for policy tightening may become less restrictive.
Data from CME Group’s FedWatch Tool showed the probability of a quarter-point rate increase in September fell to 34.6 percent from 55.0 percent a week earlier. That shift suggests investors reduced the odds of further hikes as inflation momentum appeared to moderate.
Oil slides and what it signals
Energy prices also weighed on sentiment. Crude oil fell on Thursday after reports from energy agencies indicated that global demand is expected to drop more than previously forecast. West Texas Intermediate for September delivery declined by $1.76, or 2.11 percent, to $81.51 per barrel.
Oil weakness can matter for equities in Singapore both directly—through energy-linked exposure—and indirectly via broader macro expectations, including inflation dynamics and the outlook for growth. With demand concerns in focus, investors may continue to scrutinize whether softer consumption signals a slowdown strong enough to influence rate expectations further.
Looking ahead for investors
With the STI near the 5,720 level after a two-day decline, Friday’s session will be watched for signs of stabilization. Investors will likely track whether the rate narrative remains dominant—supported by the latest inflation prints and reflected in FedWatch probabilities—and whether further moves in global oil prices reinforce or challenge current expectations. Key upcoming catalysts include additional U.S. data releases and any scheduled Fed-related commentary that could shift the balance between “higher for longer” concerns and the growing view that the rate path may be easing.
