SINGAPORE: Singapore shares closed 1.60 percent lower on Thursday, along with other Asian markets after the US government scrapped plans to buy tainted mortgage-related assets at the root of a global credit crisis.

The blue-chip Straits Times Index fell 28.54 points to finish at 1,755.47 on a volume of 947.67 million shares valued at S$915.47 million (US$605.41 million).

There were 331 declining stocks against 127 risers, with 858 issues unchanged.

US Treasury Secretary Henry Paulson said on Wednesday that the US$700 billion Troubled Asset Relief Program (TARP) would now focus on continued capital injections to struggling banks, while also looking at ways to help the "non-bank" financial sector.

DBS Vickers Securities said it expects the local market to remain weak for the rest of the year because of a slowing economy.

"With job cuts, much lower or no bonuses, weakening corporate earnings and crippled consumer spending, a year-end rally... is ruled out," Dow Jones Newswires quoted the brokerage as saying.

Singapore's economy fell into a technical recession in the third quarter, and the government expects growth of 3.0 percent for the full year.

Banking giant DBS lost 28 cents to S$10.38, United Overseas Bank fell 60 cents to S$12.10 and Oversea-Chinese Banking Corp eased eight cents to S$4.84.

Property developers were similarly lacklustre, with CapitaLand declining six cents to S$2.70, Keppel Land down 13 cents to S$1.80 and City Developments giving up 12 cents to S$6.09.

Singapore Airlines dropped 38 cents to S$11.04, Singapore Press Holdings pulled back nine cents to S$3.37 and oil rig-maker Keppel Corp retreated 15 cents to S$4.73.

Index heavyweight Singapore Telecommunications bucked the trend to finish four cents higher at S$2.42, following a ratings upgrade by some brokerage firms.


- AFP/so