Monthly Market Wrap: Benefiting from a flight to safety – banks push STI to new highs above 4,900

Date: February 2, 2026

• Amidst rising geopolitical risk, the STI jumped 5.6% to 4,905.13
• Greenland and Iran were main external worries that led to a flight to safety
• The three banks gained 5-9.2% over the course of the month
• As expected, the Fed kept rates unchanged
• Mapletree Industrial Trust’s Q3 DPU fell 7% to S$0.0317
• OUE Reit H2 DPU up 10.6% at S$0.0125, analysts called “buy’’
• New listings in January – The Assembly Place and Toku on Catalist
• Gold rallied to new highs above US$5000, SGX-listed pawnbrokers followed suit

 

With Greenland and Iran in focus, there was a flight to safety and banks benefited

Over the course of the month the Straits Times Index gained 259 points or 5.6% to close at 4,905.13, continuing the momentum in 2025 that enabled the index to gain almost 23% that year.

Mainly thanks to new record highs for the three banks, the index had risen to fresh all-time highs in January, the most recent being 4,930.03 last Thursday, 29 Jan.

For the week the index gained 14 points or about 0.3%.

In January, DBS rose S$2.84 or 5% to S$59.20, OCBC jumped S$1.47 or 7.4% to S$21.23 and UOB’s gain was S$3.21 or 9.2% at S$38.27.

Greenland and Iran were main external worries

Externally, the main worry was geopolitical, initially with the focus on Greenland after US President Trump’s claim on the country and threats of the possible use of military force.

This was then followed by concerns over the situation in Iran, with Trump threatening sanctions and the use of force amidst civil unrest in the country.

The result was a flight to safety which likely benefited safe havens like the Singapore market as well as gold and silver.

As expected the Fed kept rates unchanged, tech trade selloff continued

The Federal Open Market Committee maintained a target range for the federal-funds rate of 3.5% to 3.75% at its meeting last week. The central bank had lowered interest rates by a quarter-point in each of the past three meetings.

The outcome was widely expected – just before the meeting, the futures market was pricing in a 70.2% chance that rates would be held steady through at least April, according to the CME FedWatch Tool.

Odds of a cut at the March meeting on Friday stood at 15% and 32% in April.

Wall Street ended the trading week in the red as most of the Magnificent Seven stocks reporting earnings did not lift sentiments, contributing to an ongoing tech trade sell-off that started several weeks ago.

The S&P 500 nonetheless, managed to cross the 7,000 level for the first time on Tuesday before retracing back. The main indexes then followed a rocky path downhill.

For the week, the S&P added 0.3%, while the tech-heavy Nasdaq Composite dipped 0.2%, and the blue-chip Dow fell 0.4%

Mapletree Industrial Trust’s Q3 DPU fell 7% to S$0.0317

“Available indicators suggest that economic activity has been expanding at a solid pace,” the FOMC said in its statement. “Job gains have remained low, and the unemployment rate has shown some signs of stabilization. Inflation remains somewhat elevated.”

Mapletree Industrial Trust (MIT) reported a distribution per unit (DPU) of S$0.0317 in the third quarter ended Dec 31, 7% lower than the corresponding year-ago period.

MIT’s manager said Q3 revenue fell 8% to S$163.1 million whilst the amount distributable to unitholders declined 6.9% to S$90.5 million and property expenses fell 8.6% to S$40.3 million.

Net property income decreased 7.8% to S$122.8 million in Q3 whilst total borrowings stood at around S$3.1 billion as at Dec 31. MIT’s aggregate leverage ratio remained healthy at 37.2%.

The manager added that it will continue its leasing efforts to improve occupancies, particularly in North America.

Active lease management, cost containment and prudent capital management remain its focus to balance the risks and costs in the uncertain macroeconomic environment, it said.

It will also keep undertaking selective divestments in North America and Singapore to enhance MIT’s financial flexibility, as well as redeploy capital into markets and assets that can provide sustainable growth.

The DPU of S$0.0317 will be paid out on Mar 12.

OUE Reit H2 DPU up 10.6% at S$0.0125, analysts called “buy’’

OUE Real Estate Investment Trust (REIT) last week posted a DPU of S$0.0125 for the second-half ended December, up 10.6% year on year from S$0.0113.

The stronger performance came amid continued resilient operating performance across the REIT’s portfolio, alongside stronger capital structure, which allowed the trust to benefit from the lower interest-rate environment, said the manager.

The distribution for the period will be paid on Mar 10, after book closures on Feb 3.

In response, CGS international raised its target price for the counter to S$0.41 from S$0.38 with analysts Lock Mun Yee and Li Jialin keeping their “add” call, given the management’s positive view on rental revisions for commercial assets, and the better outlook for the hospitality segment, driven by a stronger event calendar.

They also expect interest expense savings and benefits from the potential acquisition of a Sydney CBD Office, they said in a note on Wednesday.

Similarly, Maybank said it has raised its FY26/27E DPU by 2% on an improving hospitality segment contribution and a lower cost of equity. “We lift our DDM-based (dividend discount model) target price by 18% to S$0.45, and maintain BUY’’ said Maybank.

New listings in January – The Assembly Place and Toku on Catalist

Co-living operator The Assembly Place listed in January, first trading closing at S$0.29 on its first trading day, a premium of S$0.06 or 26% on volume of 17.3m. It finished the month at S$0.30..

The offering comprised a public tranche of two million shares which was 35.5 times subscribed, drawing 1,125 valid applications for 71.1 million shares, alongside a placement tranche of around 48.3 million shares, which was 3.9 times subscribed.

Customer experience platform Toku also debuted on Catalist in January, closing at S$0.285 on its first day of trading, a $0.035 or 14% premium over its S$0.25 offer price, with 30.7m shares traded. It finished the month at S$0.265.

Toku had offered 63 million placement shares and two million public offer shares, which gave it a market capitalisation of around S$142.6 million.

Gold rallied to new highs above US$5000, SGX-listed pawnbrokers followed suit

Gold continued its rise to new highs last week, hitting a record price of US$5,600 an ounce. The price has risen 27% in the past month and 97% compared to the same time last year. However, it pulled back on Friday to around US$4,900-5300 per ounce.

According to most experts, the rise is being driven by heightened geopolitical tensions which are driving the need for portfolio diversification.

“We have started the year with geopolitical risks back on the table and gold has been rallying on the back of the Venezuela news and the Greenland headlines’’ said Alexandra Symeonidi, senior credit and sustainability analyst from William Blair’s emerging markets team in a Business Times report.

Symeonidi noted that macroeconomic conditions have also contributed to gold’s rally: “Among investors, macro uncertainty has prevailed as the Federal Reserve’s path is unclear, given question marks about the US economy and the next Fed leadership. Gold also firmed (up) as news of the Fed-related subpoenas added to broader market uncertainty.”

BT also reported that shares of pawnbrokers and other gold plays listed on SGX have soared in response. Among the top beneficiaries are MoneyMax Financial Services which is up more than 300% in the past year to above S$0.80, ValueMax, which has risen more than 160% and CNMC Goldmine, whose shares have surged more than 416% in the same period.

Pawnbroking firms are regarded as proxies to the increase in gold prices, as they hold large inventories of the yellow metal, which is used as collateral for loans.

Carmen Lee, OCBC head of equity research, noted that most moneylending companies usually accept gold jewellery as pledges for cash and usually hold a large percentage of gold inventories relative to other assets, such as diamonds.

“Gold prices rose 65% in 2025 and are up 15% so far this year. (Therefore), most of these inventories held by the moneylenders are likely to be at prices which are significantly lower than current prices,” she said.

Alfie Yeo, senior research analyst at RHB Singapore, concurred that higher gold prices can cause pawnbrokers’ collateralised gold inventory to be more valuable.

“The value of loans has historically been positively correlated with gold prices. Pawnbrokers get to lend more – (with) better loan to value – for higher interest income as gold prices increase,” he said.

Since higher gold prices tend to drive more loans, which in turn boosts interest income and earnings, higher gold prices should be positively correlated with share prices “to some extent”, Yeo said.

“Based on our analysis, the correlation of pawnbrokers’ share price to gold price ranges from 0.5 to 0.8, with pure-play pawnbrokers at a relatively strong 0.8,” he said.