The post-pandemic era has arrived in Singapore, says Daniel Moss on Bloomberg. Last week the city-state scrapped limits on group size and office working. “Many venues will no longer require folks to check in with the government contract-tracing app.” After two years of “uber-caution”, authorities have shifted with uncharacteristic haste. Fear that “onerous rules” were denting Singapore’s position as “a premier aviation hub” helped drive the decision to re-open. Trade-dependent Singapore “cares deeply about its reputation abroad”.
“The Singapore market stands out as a shelter in the current stagflation environment,” says Paul Chew of Phillip Capital. “Almost every sector… enjoys a tailwind. Transport, telecoms, retail and hospitality, which make up 20% of the Straits Times Index (STI), will benefit from the reopening of borders. Banks, which account for 45%, will get a “huge lift” from rising rates: a one percentage point rise in interest rates could increase earnings by 18%. The tech sector – once hot, but now struggling globally – is just 2% of the STI. The biggest Singapore-based tech stock is video games and e-commerce firm Sea, which is listed in New York instead. It’s down 61% this year.
That mix has helped the STI gain a healthy 7.5% this year (the MSCI Singapore index – which includes Sea – is down 6%). It doesn’t make up for an annualised return of just 5.2% in the five years to 31 March – partly due to its high weighting to financial stocks – compared with a global average return of 13%, but the long spell of underperformance has left it looking comparatively cheap. “Current valuations remain undemanding,” reckons Adrian Loh of UOB Kay Hian. At 3,350, the index is trading on 13.5 times forecast earnings for 2022, with a forecast yield of 4.1%.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
1 million pensioners relying solely on state pension face £1.4k shortfallThe shortfall between the ‘minimum’ required for Pensions UK’s basic Retirement Living Standards and the full new state pension will be thrust into the spotlight on Saturday
-
Number of ISA millionaires hits record high – how you could become oneThere are more than 5,000 ISA millionaires, according to HMRC data, with some investors sitting on pots worth more than £11 million. We reveal the secrets of the ISA millionaires
-
Who is Jared Isaacman, SpaceX astronaut and Trump's pick as NASA chief?Jared Isaacman is a close ally of Elon Musk and the first non-professional astronaut to walk in space. Now, he is in charge of NASA
-
Three solid British stocks going cheapOpinion Ian Lance and Nick Purves, fund managers at Temple Bar Investment Trust, highlight three British stocks with strong cash flows and robust balance sheets
-
Is now a good time to invest in Barclays?Barclays' profit growth is healthy, and the stock is cheap compared with its rivals
-
Profit from other investors’ trades with CME GroupCME Group is one of the world’s largest exchanges, which gives it a significant competitive advantage
-
Key lessons from the MoneyWeek Wealth Summit 2025: focus on safety, value and growthOur annual MoneyWeek Wealth Summit featured a wide array of experts and ideas, and celebrated 25 years of MoneyWeek
-
Defeat into victory: the key to Next CEO Simon Wolfson's successOpinion Next CEO Simon Wolfson claims he owes his success to a book on military strategy in World War II. What lessons does it hold, and how did he apply them to Next?
-
Aircraft leasing companies can lift investors' portfoliosThe aircraft leasing business is a safer way to cash in on air travel and its booming demand. David Prosser explains how it works and how to access it
-
8 of the best houses for sale with fishing rightsThe best houses for sale with fishing rights – from a Georgian property on the banks of the River Derwent, County Durham, to a restored mill house in Marlborough with fishing rights on the River Kennet
