Singapore shares rose on Monday as positive data from the United States instilled optimism and boosted investor confidence, while shares of COSCO Corp tumbled to their lowest in more than four years on disappointing earnings.
The Straits Times Index gained 0.4 percent to 3,383.25, while the MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.9 percent.
Shares of COSCO Corp Ltd, a unit of China’s maritime conglomerate China Ocean Shipping (Group) Co, fell more than 6 percent to S$0.815 after the company posted a 65 percent drop in its first-quarter net profit.
More than four million shares of COSCO were traded, 2.3 times the average full-day volume over the past 30 days.
Brokers were bearish on COSCO Corp as the shipping market remained in doldrums.
“Shipbuilding outlook remains bleak with margins expected to deteriorate further into the year,” Maybank Kim Eng said in a research note, keeping a “sell” rating with an unchanged target price of S$0.73.
OCBC Investment Research downgraded the stock to ‘sell’ and cut its fair value estimate to S$0.76 from S$0.90, saying it expects the company’s operating margins to remain under great pressure notwithstanding improving gains in efficiency and productivity.