By Chen Lin and Tom Westbrook
SINGAPORE (Reuters) -Singapore announced on Friday the strictest curbs on social gatherings and public activities since easing a COVID-19 lockdown last year, amid a rise in locally acquired infections and with new coronavirus clusters forming in recent weeks.
The new measures announced by the health ministry, which will be force from Sunday to mid June, include limiting social gatherings to two people and ceasing dining in at restaurants.
"This is clearly a setback in our fight against COVID-19, " said Lawrence Wong, the minister for education who co-chairs Singapore's coronavirus taskforce.
The new moves, which dashed hopes Singapore was heading towards a re-opening, sent the Straits Times Index and Singapore Airlines' stock price to the lowest in more than two months.
"Quick reopening hopes have been dashed, especially for the travel and leisure sectors," said Bank of Singapore analyst Moh Siong Sim. "Manufacturing should hold up as has been the case over the past year."
Working from home will also be made the default arrangement under the new measures.
Albeit with a reduced capacity, shopping malls and cinemas will be allowed to keep operating, and events and weddings to take place under the new arrangements.
The authorities said they will review the measures after two weeks to assess if adjustments are needed.
The Asian trade and financial hub had been reporting almost zero or single-digit daily local infections for months, before a recent rise in cases. On Thursday, it confirmed 24 locally transmitted COVID-19 cases, the highest daily number since mid-September driven partly by a cluster at Changi airport.
Transport Minister Ong Ye Kung said given the rising infections it is "very likely" that Singapore would not meet the threshold for a long-delayed Hong Kong travel bubble, which was recently rescheduled to start in late May.
The Singapore stock market dropped about 3%, led by falls in retail-exposed shares and companies exposed to travel. Singapore Airlines shares fell more than 6%.
The Singapore dollar also slipped a fraction after the announcement.
Singapore is due to hold the annual Shangri-La Dialogue from June 4–5, which typically attracts top level military officials, diplomats and weapons makers from around the globe.
The city-state is also planning to host the World Economic Forum's annual summit in August.