Singapore’s Straits Times Index lost 49.84, or 2.8 percent, to close at 1,745.63. Almost four stocks retreated for each that gained among the measure’s 30 constituents.
Today’s decline took the index’s 2008 loss to 50 percent. That would be its largest annual drop on record.
Banks: DBS Group Holdings Ltd. (DBS SP), Singapore’s largest bank, dropped 48 cents, or 4.9 percent, to S$9.37, the biggest drop since Nov. 11. The bank is seeking to raise S$4 billion ($2.76 billion) in a rights offering to weather the credit crisis. Fourth-quarter profit before one-time charges will fall from the previous three months and credit costs will increase in 2009, the company also said.
United Overseas Bank Ltd. (UOB SP), Singapore’s second-largest bank by assets, retreated 66 cents, or 5.1 percent, to S$12.34. Oversea-Chinese Banking Corp. (OCBC SP), the third-largest, fell 14 cents, or 2.8 percent, to S$4.93.
Property developers: CapitaLand Ltd. (CAPL SP), the biggest developer, slipped 42 cents, or 13 percent, to S$2.88, retreating from a three-month high. That’s the largest drop since September 2001. City Developments Ltd. (CIT SP), Singapore’s No. 2 real estate company by assets, dropped 42 cents, or 6 percent, to S$6.56, halting a six-day, 17 percent rally. Keppel Land Ltd. (KPLD SP), the third-largest, slipped 9 cents, or 5 percent, to S$1.70.
More than 10,000 homes sold under a deferred mortgage plan in Singapore have not been completed, the Urban Redevelopment Authority said on Dec. 19, as a recession and depressed property prices fuel concerns defaults may rise in the next two years. Some of these homes may be at risk of default if prices fall sharply or if buyers are unable to get mortgages, analysts said.
“We can assume that the bulk of these 10,450 homes have not crystallized their loans yet, as payment to the developer will only be made when the home is completed,” CLSA Ltd. analyst Dhruv Vohra said in a report today. “With home prices dropping now, the related owners will need to put more equity than they earlier planned. Owners with low affordability can default on the developer, or make a distress sale in the market.”
Beauty China Holdings Ltd. (BCH SP), the owner of the Colour Zone brand of cosmetics and skin-care products, climbed 2 Singapore cents, or 5.9 percent, to 36 cents after saying it entered into a preliminary agreement to produce, use and sell cosmetics products by Japan’s JO Cosmetics Co. in China.
Haw Par Corp. Ltd. (HPAR SP), the maker of Tiger Balm, fell 6 cents, or 1.6 percent, to S$3.74, the largest drop since Dec. 12. Kim Eng Securities said Chairman Wee Chow Yaw is “unlikely” to make a general offer for Haw Par after increasing his stake in the company to more than 30 percent earlier this month. The stock jumped 10 percent last week after the Straits Times newspaper speculated that Wee would have to make a mandatory offer for Haw Par.
Middle East Development Singapore Ltd. (MEAST SP), a maker of protective coatings for buildings, surged 1.5 Singapore cents, or 30 percent, to 6.5 cents, its largest gain since Dec. 4. It’s seeking to sell as many as 79.5 million new shares at 5 Singapore cents apiece to raise funds for its business and investments, the company said.
Singapore Airlines Ltd. (SIA SP), Southeast Asia’s largest carrier, fell 40 cents, or 3.3 percent, to S$11.76, the biggest loss since Nov. 20. Australia’s antitrust regulator has begun legal action against the carrier’s cargo unit, alleging it acted in a cartel with other carriers and fixed prices.
Yangzijiang Shipbuilding Holdings Ltd. (YZJ SP), a China- based shipbuilder, rallied 1 Singapore cent, or 2.2 percent, to 46 cents, its largest gain since Dec. 10. China may lose as many as half its shipbuilders next year as the global financial crisis forces companies to close down, Shanghai Securities News reported, citing Ren Yuanlin, chairman of Yangzijiang. The company is the best-positioned among the nation’s shipyards to survive the crisis, the newspaper said, citing Ren.