- POSTED: 08 Oct 2013 23:53
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Penny stocks continued their roller-coaster ride on the Singapore Exchange on Tuesday, prompting SIAS to call for more measures to safeguard investors interests.
SINGAPORE: Penny stocks continued their roller-coaster ride on the Singapore Exchange (SGX) on Tuesday.
The market volatility prompted the Securities Investors Association of Singapore (SIAS) to call for more measures to safeguard investors interests.
Still, some companies are unperturbed with the market sentiment and have taken the opportunity to share their plans going forward.
The three stocks that have come under SGX's trading curbs - Blumont Group, Asiasons Capital and LionGold Corp - staged a quick rebound in early trading on Tuesday.
But they could not hold on to their gains.
At the market close, Blumont's share price remained unchanged while Asiasons and LionGold fell deeper in the red.
Blumont's share price more than doubled earlier Tuesday to hit an intra-day high of 30 cents after naming a new chairman, before ending flat at 13 cents.
Shares of Asiasons rose as much as 57 per cent to 24 cents, but ended at 11.6 cents.
LionGold climbed as much as 44 per cent to 36 cents, but ended at 19 cents.
Such wild swings in share prices of penny stocks show that investor confidence on the sector remains fragile.
Daryl Liew, senior portfolio manager at Reyl Wealth Management, said: "If you look at the price moves...some stocks were down 90 per cent from their peak, so a 10, 20, 50 per cent bounce is not really material.
"I think some of the investors are still looking at quite significant losses... Even outside this pool of 3 to 6 companies, the entire penny stock space has been affected. Because generally sentiment has been shaken a bit."
Despite market uncertainty, Singapore-listed steel trading company Albedo remains upbeat about its prospects.
The company has announced details of a S$774 million takeover deal with Infinite Rewards, and it is to commence with the phase one development of a business park in Iskandar Malaysia, in January 2014.
The move boosted its share price by 40 per cent to 4.2 cents on Tuesday.
Meanwhile, SIAS has called on the SGX to implement a circuit breaker mechanism immediately.
This is to facilitate better decision-making by investors.
SIAS also wants all listed companies to disclose all relevant information in good time.
It advises investors to remain cautious amid sudden price fluctuations.
Yet, some analysts applauded the SGX for stepping in and preventing prices from further running wild.
Reyl Wealth Management's Mr Liew said: "If (SGX) didn't (intervene), there would be the risk that prices would have continued to run up even further."
"I think the SGX is in the best position to make the judgment call... it can actually trace and do investigations if it sees that something is not quite right."