David Gerald
Founder, President & CEO, SIAS
Investing in an attractive and under-appreciated Singapore market
Dear members
November’s main market-moving event was undoubtedly the US Presidential elections, which saw the return of Republican candidate Donald Trump to the White House. His election win sparked off a rally on Wall Street which helped send the Straits Times Index past 3,600 and 3,700 to several 17-year highs.
This brings me to an article which SIAS authored that was published in the Straits Times on 5 November, titled “Is the Singapore market as bad as it’s made out to be?’’.
The article is significant for two reasons. First, it highlighted that instead of viewing the glass as being half empty, local investors should view it as being half full and give the Singapore stock market a closer look.
In terms of valuations such as price-earnings and discount to book values Singapore stocks compare very favourably with other markets such as the US. Furthermore, providing ample support for stock prices is a decent dividend yield, which should improve if interest rates head lower as many expect.
SIAS also pointed out that although the STI’s rises to new highs have come largely from the banks, the manufacturing sector has also done well, citing an SGX Research report that said the iEdge SG Advanced Manufacturing Index achieved an 11.3 per cent net total return between July and October, driven by a global pivot in interest rates and a strong recovery in Singapore’s July and August industrial production.
Second, the article stated that the relative attractiveness of a market which apparently has been largely ignored by local retail investors has prompted SIAS to undertake an initiative to take the “Invest in Singapore’’ theme to the heartlands, the details of which are expected to be announced in the first quarter of next year.
It is SIAS’s view that too many investors are either afraid to invest or simply don’t know where to begin, thus allowing inflation to erode their savings. It is our intention to guide everyone throughout their investment journey by getting them to buy into relatively safe products with minimal risk.
Also in November, SIAS together with Beansprout has sent a survey to its subscribers to ask them why they might be shunning the local market, as well as to encourage them to share their experiences and preferences when investing in the local stock market.
I will keep you updated on the findings which should prove important to the high-level committee set up recently to study ways to rejuvenate interest in local stocks.
Meanwhile, members can look forward to the usual menu of SIAS’s events, including the regular Corporate Connect sessions on 3 Dec featuring Sasseur REIT and 10 Dec featuring ISEC Healthcare. These are of course, in addition to the usual weekly market reviews and our Ask SIAS session on 11 Dec.
All that remains for me is to wish everyone a Merry Xmas and a Happy Successful Investing New Year!
1 December 2024
Click here to view past President's Message
