Singapore Jan 16 Singapore shares edged down on Thursday despite robust U.S. data and upbeat earnings from Bank of America, while stocks of commodities firms fell on concerns about changing supply and demand dynamics.
With the world's two largest economies in the midst of change, Maybank predicted that China's rebalancing of its economic growth model and the U.S. Federal Reserve stimulus tapering would affect the supply-and-demand dynamics of the commodity trading industry.
"Against a fluid and changing backdrop, we value earnings visibility above growth outlook," Maybank said in a research note. "We prefer companies with clear catalysts and less likelihood of an earnings miss."
Shares of Wilmar International Ltd fell 0.6 percent to S$3.25, while Noble Group Ltd and Olam International Ltd were down 0.5 percent to S$1.03 and 0.6 percent to S$1.54 respectively.
Wilmar was Maybank's top sector pick with a "buy" rating and a target price of S$4.30, while Noble and Olam were both rated "hold".
Bank of America Corp, the second-largest U.S. bank, showed signs of recovery after its quarterly profit surged by nearly $3 billion as revenue increased and mortgage losses plunged.
The benchmark Straits Times Index edged down 0.1 percent to 3,140.42 points by 0545 GMT, while the MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.1 percent.
Singapore telecommunications firm StarHub Ltd was the worst performer on the index, falling as much as 1.7 percent to a nearly one-month low at S$4.15, trading at 1.5 times its average 30-day full-day volume.