The Singapore stock market headed south again on Wednesday, one session after ending the two-day slide in which it had fallen more than 20 points or 0.7 percent. The Straits Times Index now sits just beneath the 3,115-point plateau although it figures to bounce higher again on Thursday.
The global forecast for the Asian markets is upbeat following results of the FOMC's monetary policy meeting. The European and U.S. markets were solidly higher and the Asian bourses figure to open in similar fashion.
The STI finished modestly lower on Wednesday following losses from the properties and industrials, while the financials were mixed.
For the day, the index slid 6.21 points or 0.20 percent to finish at 3,114.88 after trading between 3,106.63 and 3,120.55. Volume was 883.4 million shares worth 761.8 million Singapore dollars. There were 264 decliners and 180 gainers.
Among the actives, Ascendas REIT lost 0.34 percent, while CapitaLand Integrated Commercial Trust retreated 0.50 percent, City Developments sank 0.42 percent, Comfort DelGro jumped 1.45 percent, Dairy Farm International plummeted 2.42 percent, DBS Group rose 0.19 percent, Genting Singapore surrendered 0.64 percent, Keppel Corp shed 0.39 percent, Mapletree Commercial Trust plunged 0.98 percent, Mapletree Logistics Trust declined 0.53 percent, Oversea-Chinese Banking Corporation fell 0.27 percent, SembCorp Industries skidded 0.51 percent, Singapore Airlines dipped 0.20 percent, Singapore Exchange slid 0.21 percent, SingTel dropped 0.41 percent, Thai Beverage tumbled 0.75 percent, United Overseas Bank collected 0.15 percent, Wilmar International tanked 0.96 percent and Yangzijiang Shipbuilding, Singapore Press Holdings, Singapore Technologies Engineering and SATS were unchanged.
The lead from Wall Street is broadly positive as the major averages opened slightly lower on Wednesday but then surged in the afternoon to finish sharply higher.
The Dow soared 383.25 points or 1.08 percent to finish at 35,927.43, while the NASDAQ spiked 327.94 points or 2.15 percent to end at 15,565.58 and the S&P 500 jumped 75.76 points or 1.63 percent to close at 4,709.85.
The late-day rally on Wall Street came after the Fed announced its widely expected decision to accelerate the pace of reductions to its asset purchases program. Citing inflation developments and further improvement in the labor market, the Fed said it has decided to reduce the monthly pace of its net asset purchases by $30 billion per month, double the previously announced $15 billion per month.
The Fed said it expects similar reductions in the pace of net asset purchases will likely be appropriate each month, pointing to an end to the program next March. Analysts partly attributed the subsequent rally to relief that the Fed was not more aggressive in accelerating the timetable for halting its asset purchases.
Meanwhile, the Fed also announced its widely expected decision to keep the target range for the federal funds rate at zero to 0.25 percent. The central bank's latest projections forecast as many three rate hikes in 2022 compared to the lone rate hike forecast in September.
Despite the prospect of sooner than expected rate hikes, analysts suggested traders were pleased with the increased level of certainty provided by the Fed's latest projections.
Crude oil futures settled higher on Wednesday after the Energy Information Administration (EIA) said crude inventories in the U.S. dropped by 4.6 million barrels last week. West Texas Intermediate crude oil futures for January ended up by $0.14 or 0.2 percent at $70.87 a barrel.