UOB share price: What’s the latest amid new Covid-19 fears?
Shares of United Overseas Bank opened 5.2% lower on Monday, as a new wave of Covid-19 cases emerged in China and the US over the weekend.
Shares of United Overseas Bank (UOB) plunged 5.2% as the market reopened on Monday 15 June 2020, amid growing concerns over a second wave of Covid-19 infections.
Singapore’s third largest money lender saw its share price slide further ten minutes into trading, dropping to S$21.11 a share – its lowest level in two weeks.
Risk-off mood still in action this week
As IG Asia market strategist Pan Jingyi wrote in her latest client note, a risk-off mood has carried over into Asia this week, despite the Wall Street retracement that had taken place on Friday.
‘The market remains in contemplation as to whether prices had overran with the initial reopening optimism after last week’s dip post the recent surge in prices,’ Pan wrote, adding that new cases recorded in Beijing and various states across the US were also fuelling fresh concerns among investors.
This apprehension appears to be gaining momentum for now. As at 11:30 SGT on Monday, Singapore’s main stock benchmark Straits Times Index is down roughly 1.2% from Friday’s closing.
UOB’s share price soared nearly 17% at the start of June
In the last one month, UOB – like most other equities – has experienced a massive rebound in share price, as investor sentiments became increasingly optimistic on the back of Covid-19 lockdown easing around the world, as well as here in Singapore.
Singapore entered a so-called ‘phase one’ of its lockdown easing on 02 June 2020, under which firms in the manufacturing and services sector, among others, were allowed to resume operations.
Following that, UOB’s share price soared nearly 17% to a three-month high of S$23.15 on 10 June 2020.
Prices have retraced since, but remain lifted by at least 6% from May 2020’s average range of between S$19.30 to S$19.90 a share.
UOB has an average share price target of S$19.97
For now, the government has indicated that it will move into a ‘phase two’ if community transmission rates stay low and stable over the subsequent few weeks, and foreign worker infection rates – where the bulk of cases have been reported – are kept under control.
Earlier this month, Singapore’s three main banks – namely UOB, alongside DBS and Oversea-Chinese Banking Corporation (OCBC) – saw their stock prices increase as much as average of 11%, as countries globally began to map out their economic recovery plans.
As of 15 June 2020, UOB has received a consensus 12-month share price target of S$19.97 from five analysts, based on reports dating back a month.
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