Bank earnings in focus amidst heavy rotational playing of second liners

Date: May 11, 2026

• The STI added 0.2% at 4,921.90 with bank earnings in focus
• Latest US jobs report points to no rate cut in June
• OCBC’s wealth business drove Q1 profit up 5% to better-than-expected $$1.97 billion
• UOB’s reported 4% drop in Q1 net profit to S$1.44b, but beat expectations
• Q1 non-interest income for banks at record S$5.16b: SGX Research
• Rotational playing of second line ensure solid gains
• StarHub Q1 net profit plunged 81.3% to S$5.9 million as consumer business slid across the board
• Venture’s 1Q earnings up 0.7% to S$56.3m
• Centurion Accomodation REIT’s Q1 NPI of S$37.5m exceeded IPO forecast

 

The STI rose 0.2% to 4,921.9

The Straits Times Index edged about 9 points or 0.2% higher over the week to finish at 4,921.90, driven mainly by movements in the banks and large-caps like Singtel.

Average daily volume was S$2.2b versus S$1.84b the week before.

The real action however, took place in the second line with stocks like ISDB, CSE Global, Valuetronics, Avi-tech, Asia Medic and Chasen racking up large percentage gains in large volume.

US jobs report, tech earnings overshadow Iran war as US stocks surged

Wall Street finished the week sharply higher as investors weighed a stronger-than-expected U.S. jobs report, upbeat semiconductor earnings, and escalating geopolitical tensions in the Middle East.

According to data released by the U.S. Bureau of Labour Statistics, US nonfarm payrolls increased by 115,000 jobs in April, surpassing economists’ consensus estimate of 63K. Meanwhile, the unemployment rate held steady at 4.3%, signalling continued resilience in the labour market despite broader economic uncertainty.

Overall, the report suggests the labour market has so far absorbed the shock from the ongoing war with Iran. For the Fed, the report also removes any near-term pressure to lower interest rates.

This is “not the job print that makes cutting more likely,” said Lindsay Rosner, head of multi-sector fixed income investing at Goldman Sachs Asset Management. “The Fed will shift its focus to containing upside inflation risks now that the labour market appears back on track’’.

Rosner said that policymakers could feel compelled to remove the Fed’s current easing bias at their June meeting, suggesting the hawks, who focus more heavily on inflation, are gaining the upper hand.

As of Friday, the futures market was pricing in a 93.4% chance that the US central bank will hold rates steady at its 17 June meeting.

For the week, the S&P 500 added 2.3%, while the tech-heavy Nasdaq Composite jumped 4.5%, and the blue-chip Dow Jones Industrial Average added 0.2%.

OCBC’s wealth business drove Q1 profit up 5% to better-than-expected $$1.97 billion

OCBC reported a 5% rise in earnings for the quarter ended March 31 to S$1.97 billion, beating analysts’ forecast of S$1.88 billion in a Bloomberg poll.

Net interest income declined 5% to S$2.22 billion amid a lower interest-rate environment. Net interest margin fell to 1.76%, 28 basis points below 2.04% a year ago.

Non-interest income rose 23% to S$1.61 billion and accounted for more than 40% of total income. Net fee income grew 24% to $675 million on broad-based growth.

Of this, wealth management fees surged 34%. Investment banking, trade-related and loan-related fees were also higher compared with the previous year.

The group’s wealth management income – from private banking, premier private client, premier banking, insurance, asset management and stockbroking – surged 11% to $1.48 billion.

Over the week, OCBC’s shares gained S$0.02 at S$21.92.

UOB’s reported 4% drop in Q1 net profit to S$1.44b, but beat expectations

UOB’s net profit for the three months to March 31 was S$1.44 billion, down 4% from $1.49 billion a year ago, but beat analysts’ expectations of S$1.39 billion in a Bloomberg poll.

Net interest income fell 4% to $2.32 billion on lower benchmark rates, with net interest margin narrowing to 1.82% from 2% a year ago.

Net fee income slid 8% to $637 million, while other non-interest income plunged 17% to $462 million, mainly due to softer trading and investment income.

For its 2026 outlook, UOB kept its guidance unchanged, including low single-digit loan growth, high single-digit fee income growth, low single-digit operating cost growth and total credit costs at 25 to 30 basis points.

The bank also maintained its full-year guidance for net interest margin of 1.75- 1.8%.

UOB aims to double its wealth income by 2030 by better serving a growing pool of affluent customers, deputy chairman and chief executive Wee Ee Cheong said at the bank’s earnings briefing.

“We see significant opportunities, including with wealth, underpinned by a large and increasingly affluent customer base that is underpenetrated. This gives us a long runway for sustainable, organic growth,” he said.

UOB’s wealth income rose 6% to $342 million in the first quarter from $323 million a year ago. For 2025, wealth income rose to $1.28 billion, from $1.12 billion in 2024.

Over the week, UOB’s shares rose S$0.41 or 1.1% to S$36.56.

Q1 non-interest income for banks at record S$5.16b: SGX Research

In its latest Market Update, SGX Research said the combined 1Q26 non-interest income for DBS, OCBC, and UOB rose to a combined S$5.16 billion, setting a new quarterly record, and up from S$4.00 billion in 4Q25 and S$4.78 billion in 1Q25, accounting for 39% of total income in 1Q26.

“For 14 consecutive quarters, the trio have reported combined net interest income above S$8bn, reaching S$8.04 billion in 1Q26. This was down from S$8.24 billion in 4Q25 quarter, and S$8.44 billion in 1Q25, accounting for 61% of total income in 1Q26’’ reported SGX Research.

Rotational playing of second line ensure solid gains

Traders continued their rotational playing of second liners, resulting in many enjoying large percentage gains in good volume.

On Monday for instance, Olam International jumped S$0.16 or 15.7% to S$1.18 on volume of 51.8m and Chasen surged S$0.015 or 15.2% to S$0.114 with 38m traded.

On Tuesday, the play switched to Beng Kwang, Asia-Medic, Aoxin Q&M and ISDN, among others.

StarHub Q1 net profit plunged 81.3% to S$5.9 million as consumer business slid across the board

Telco Starhub reported an 81.3% fall in net profit of S$5.9 million for its first quarter ended 31 March 2026 on the back of a 6.1% drop in revenue to S$507.3 million.

The consumer business logged declines across the board, as revenue fell 10% to S$228.6 million.

This was led by the mobile segment, which posted a 10.9% decline in revenue to S$124 million.

Revenue for the enterprise business fell 4.8% to S$139.4 million due to timing of project recognitions from managed services. This was partially offset by higher enterprise connectivity and carrier and voice revenues.

The top line declines led to a 22.5% slide in earnings before interest, taxes, depreciation and amortisation to S$77.7 million.

In downgrading Starhub to a “hold’’, Maybank sait it has set a lower target price of S$1 from S$1.30 following weaker-than-expected 1Q results, consolidation delays and rising visibility of enterprise, IT & cybersecurity investments over 12–24 months.

“While management continues to position 2026 as a transition year for enterprise scaling, we believe earnings could remain pressured before meaningful revenue benefits emerge from 2027 onwards’’ said Maybank.

“We do not see a strong case to turn outright negative given StarHub’s ~6% dividend yield and inexpensive valuation. Within Singapore telcos, we prefer Singtel…’’.

Over the week, Starhub’s shares fell S$0.04 or 3.8% to a 52-week low of S$1.01.

Venture’s 1Q earnings up 0.7% to S$56.3m

Technology player Venture Corp posted S$56.3 million in net profit in the first quarter of FY2026, as demand for artificial intelligence infrastructure continues to grow worldwide, 0.7% higher compared to a year ago.

Revenue for Q1 FY2026 rose 1.9% to S$628.5 million due to heightened demand across technology domains that support AI-related infrastructure.

This was driven by its Portfolio B, which consists of domains such as test and measurement instrumentation, networking and communications, as well as semiconductor-related equipment. The portfolio’s revenue increased 11.2% to S$417 million.

However, revenue of the group’s Portfolio A – comprising the life sciences, medtech and lifestyle consumer segments – decreased S$30 million to S$212 million, from S$242 million in the year-ago period.

Venture said this was due to declining year-on-year volumes in the lifestyle consumer domain.

Earnings per share edged up 0.9% to S$0.195, from S$0.193 in the year-ago period.

Centurion Accomodation REIT’s Q1 NPI of S$37.5m exceeded IPO forecast

Centurion Accommodation Real Estate Investment Trust (CAReit) posted net property income of S$37.5 million for the first quarter ended Mar 31, 2.4% higher than its prospectus forecast of S$36.6 million.

Revenue stood at S$52.5 million for the period, 2.7% higher than the projected S$51.1 million.

The better-than-expected results came on the back of higher occupancy and rental rates, as well as stronger currencies such as the British pound and the Australian dollar against the Singapore dollar, partially offset by higher property operating expenses.

CAReit debuted on the Singapore Exchange on 25 Sep 2025 at an IPO price of S$0.88 per unit. Its offering of 262.2 million units was 16.6 times subscribed, with sponsor Centurion Holdings holding 787.4 million units after the listing.

As at Mar 31, weighted average debt maturity was 3.9 years whilst aggregate leverage rose to 31%, mainly due to the drawdown of S$140 million and A$145 million (S$138.8 million) in loans in January 2026 to fund the acquisition of Epiisod Macquarie Park.

Epiisod Macquarie Park is a newly developed 732-bed purpose-built student accommodation asset located in Sydney, Australia, acquired on Jan 13 for A$345 million and fully financed through committed debt facilities.

The Reit’s weighted average financing cost stood at around 3.6%, with 71.7% of total borrowings hedged to fixed rates, up from 55.8% as at Dec 31, 2025. Interest coverage ratio was at 6.02 times, with a debt headroom of S$340.8 million.