Singapore Market 2Q19 Results Review - DBS Research 2019-08-20: Look Here For Yields

Singapore Market Strategy - DBS Research  | SGinvestors.io MANULIFE US REIT (SGX:BTOU) SHENG SIONG GROUP LTD (SGX:OV8) THAI BEVERAGE PUBLIC CO LTD (SGX:Y92) UNITED OVERSEAS BANK LTD (SGX:U11) SINGAPORE TECH ENGINEERING LTD (SGX:S63)

Singapore Market 2Q19 Results Review - Look Here For Yields




Earnings cuts prevailed, REITs brought cheer.



Hunting ground for yields.



Year-end objective lowered to 3380.

  • We lower our STI year-end objective to 3380 (previously 3450) to factor in the latest round of US tariffs and drag from HK civil protests. The STI is trading near 12x (-1SD) 12-month forward PE after adjusting for the latest earnings cuts.
  • Oversold technical rallies aside, the STI has likely seen the year-high at 3400 back in April. We expect more market swings ahead.


Three reasons for September calm.

  1. September is a seasonally benign month compared to ‘nasty’ August,
  2. Intensity of HK civil protests lessens as the universities’ new school term starts,
  3. ‘Powell put’ should underpin equity markets heading to the mid-September FOMC meeting.
  • Consensus expects the FED to cut rates another three times by year-end, pulling FED funds rate down to just 1.5%. Against this backdrop, we are positive on REITs and yield stocks while oversold cyclicals get a short-term rebound.
  • We see a near-term low forming recently at 3075 with a rebound to 3220-3235 in the making.
  • See attached PDF for complete report.





Kee Yan YEO DBS Group Research | Janice CHUA DBS Research | https://www.dbsvickers.com/ 2019-08-20
SGX Stock Analyst Report BUY MAINTAIN BUY 1.100 SAME 1.100
BUY MAINTAIN BUY 1.320 SAME 1.320
BUY MAINTAIN BUY 0.910 SAME 0.910
BUY MAINTAIN BUY 29.200 SAME 29.200
BUY MAINTAIN BUY 4.640 SAME 4.640



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