Stock Exchange: Market Strategy

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Thursday, 7 July 2016

Singapore Strategy

With sub-2% GDP growth expectations and EPS contractions for equities, Singapore is struggling.
Some of the attributes that have been responsible for its success so far are, ironically, stifling its further growth. These include appreciating property prices, high wage growth, high savings rates and lower returns from overseas investments.
While the government has been evolving steps to address these, we think that radical changes are called for – if not already afoot - to guard against a precipitous loss of Singapore’s relevance to global markets.

Singapore Strategy

The recent bounce in the FSSTI has brought the market back to the early-16 levels.

We highlight our preferred stocks that can navigate volatile markets and with better earnings visibility.

The FSSTI has bounced 12.6% from its ytd low of 2,528. The FSSTI is down 1.2% on a ytd basis. This report highlights our latest views and how we would navigate the volatility, which we expect to remain elevated.

SHENG SIONG GROUP LTD OV8.SI CAPITALAND LIMITED C31.SI RAFFLES MEDICAL GROUP LTD R01.SI DBS GROUP HOLDINGS LTD D05.SI QAF LTD Q01.SI

 Softness in 2016

 Volatility is the new norm

 Stick with quality stocks

2015 was a challenging year of two halves.
The first half benefited from spillover optimism from 2014, but this quickly evaporated as the market entered into the second half of the year. Sentiment was dragged down by several key events including Yuan devaluation, the sell-down in Chinese equities, slower growth from Emerging Markets and weakness in commodities.