The Singapore stock market on Tuesday resumed its downward march, one day after it had halted the two-day losing streak in which it had fallen less than 4 points or 0.1 percent. The Straits Times Index finished just above the 3,175-point plateau, and now analysts are forecasting continued weakness when the market opens on Wednesday.
The global forecast for the Asian markets suggests heavy consolidation after S&P maintained the United States' AAA credit rating after the debt limit compromise was passed - but S&P kept the U.S. on a negative outlook. Debt woes in Europe add to the miserable sentiment. Gold his a fresh record high, but airlines, properties, financials, steel companies and technology stocks all figure to fall. The European and U.S. markets plummeted on Tuesday and the Asian bourses are expected to open in similar fashion.
The STI finished sharply lower on Tuesday following losses from the airlines and plantation stocks.
For the day, the index plunged 38.18 points or 1.19 percent to finish at 3,177.09 after trading between 3,172.79 and 3,203.74. Volume was 1.63 billion shares worth 1.76 billion Singapore dollars. There were 428 decliners and 123 gainers.
Among the decliners, Cosco Corp plunged 14.2 percent, while Singapore Airlines plummeted 12.2 percent, Noble Group shed 3.4 percent, Golden Agri-Resources lost 2 percent and Wilmar International fell 1.2 percent.
The lead from Wall Street is sharply negative as stocks saw substantial weakness on Tuesday, with traders shrugging off news of the approval of the debt ceiling agreement amid continued concerns about the economic outlook and whether the deal will be enough to secure the U.S. credit rating.
While the legislation will also reduce the deficit by up to $2.5 billion over ten years, traders expressed concern that the U.S. government's AAA credit rating remains at risk. Fitch Ratings released a statement indicating that it is maintaining its AAA rating on the U.S. government following the approval of the debt agreement, but Standard & Poor's and Moody's have indicated that $4 trillion in deficit reduction would be needed to secure a AAA rating.
Continued concerns about the economic outlook also weighed on investors after the Commerce Department released a report showing the first drop in personal spending in almost two years. Personal spending fell by 0.2 percent in June compared to economists' expectations for a 0.1 percent increase - while personal income edged up by 0.1 percent in June, coming in below economist estimates for an increase of 0.2 percent.
In corporate news, shares of Pfizer (PFE) fell by 4.6 percent after the drug giant reported better than expected second quarter earnings but also reported a drop in global prescription drug sales.
The major averages saw further downside going into the close, ending the session near their worst levels of the day. The Dow plunged 265.87 points or 2.2 percent to 11,866.62, the NASDAQ tumbled 75.37 points or 2.8 percent to 2,669.24 and the S&P 500 plummeted 32.89 points or 2.6 percent to 1,254.05. With the sharp losses, the S&P 500 ended the day at its worst closing level of 2011, while the Dow fell to a four-month closing low and the NASDAQ hit a one-month closing low.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.