Monthly Market Wrap: A new all-time high for the STI, driven by the banks and Wall Street’s resilience

Date: June 2, 2026

• The STI reached a closing high of 5.072.34 in May
• The net gain for the month was 2.5% at 5,037.86
• Friday’s window-dressing push wasn’t enough to prevent a loss of 0.6% for the week
• Wall Street continued to rise to new highs, underpinned by hopes of an end to Iran war and AI earnings
• SATS reported 31% rise in Q4 profit despite impact of Middle East conflict
• Boustead more than doubled H2 profit to S$197.7 million
• DBS, UOB & OCBC reported resilient 1Q results, showed growing reliance on wealth management
• Singtel’s shares came under pressure despite seemingly strong results
• Koh Brothers Eco Engineering proposes transfer to SGX mainboard
• Singapore factory output up 17.6% in April on AI-related electronics surge, beating forecasts
• Valuetronics’ 2H earnings fall 69.8% to HK$24.1

 

A new all-time closing high but a loss for the final week

The Straits Times Index managed to reach a new all-time closing high of 5,072.34 on 19 May before slipping back to finish at 5,037.86 for net gain of about 125 points or 2.5% for the month.

Throughout May the index traded in a tight band, reaching a closing low of 4,920.61 on 5 May. Wall Street’s continued rise to new highs and relatively robust bank earnings ensured that local stocks remained well-supported.

For the week however, Friday’s 48.67-points push that was most likely thanks to month-end window-dressing was not enough to prevent a net loss of 31 points or 0.6%.

Friday’s volume of S$4.51b was more than twice the daily turnover done earlier in the week and was heavily concentrated in the banks, Singtel and SGX, with the latter jumping S$0.43 or 2% to S$21.88 on volume of 10.4m.

Wall Street continued to rise to new highs, underpinned by hopes of an end to Iran war and AI earnings

Wall Street finished the week on top with all three major averages advancing as investors weighed signs of easing geopolitical tensions in the Middle East, a softer-than-expected inflation reading, and strong corporate earnings that reinforced optimism around artificial intelligence-driven growth.

President Donald Trump said a framework to end the conflict with Iran and restore shipping through the Strait of Hormuz has been “largely negotiated’’ following discussions with Israel and key Middle Eastern partners.

On the inflation front, the core personal consumption price index showed underlying price pressures increased less than economists expected in April on a monthly basis.

Shares of Dell soared more than 30% on Friday, the strongest single-day performance since 2024, after the technology giant delivered blockbuster earnings and issued bullish guidance fuelled by surging demand for AI servers.

For the week, the S&P 500 moved up 1.4%, while the tech-heavy Nasdaq Composite climbed 2.4%, and the blue-chip Dow added 0.9%.

SATS reported 31% rise in Q4 profit despite impact of Middle East conflict

Airline ground handler and cargo firm SATS reported a 31% increase in net profit of S$50.7 million for its fourth quarter ended Mar 31 whilst revenue rose 9.8% to S$1.6b.

This translated to earnings per share (EPS) of S$0.034 for the quarter, from S$0.026 for Q4 FY2025.

Operating profit for Q4 FY2026 edged up 1% to S$109.4 million. However, the group’s operating profit margin narrowed to 6.7% from 7.3% the year before, due in part to ramp-up costs associated with new food facilities.

“The Middle East conflict, which escalated in the final month of the quarter, weighed on revenue, costs, operating profit and associates and joint ventures’ earnings,” the group said.

SATS president and chief executive Kerry Mok noted that the war has “weighed on industry performance”. “We have been working closely with our customers to maintain their cargo flows as routes and lanes shift, drawing on the breadth of our network to serve them wherever they need us.”

SATS’ board proposed a final dividend of S$0.05 a share, up from S$0.035 a year earlier. The group said this reflects its “commitment to delivering increased returns to shareholders as profitability grows”.

Combined with an interim dividend of S$0.02 a share, the full-year dividend will be S$0.07 a share, 40% more than in the preceding year. The dividend will be paid out on Aug 6, following shareholder approval, with the book closure date set for Jul 24.

For the full year, SATS recorded a revenue of S$6.35 billion, an increase of 9% from FY2025. This was supported by “robust cargo volume growth and contributions from ground handling and food services”, the group said.

Maybank said in a 26 May report: “We maintain our DCF-based (discounted cash flow-based) target price of S$4.52 and BUY call, as SATS’ diversified global network and resilient cargo franchise is able to help cushion ongoing macro and geopolitical headwinds’’.

Boustead more than doubled H2 profit to S$197.7 million

Engineering and technology group Boustead Singapore’s net profit for its second half ended Mar 31 grew 235 per cent to S$197.7 million from the year-ago period.

This came on the back of revenue rising 43 per cent to S$330.4 million, said the group on Monday (May 25).

On a per-share basis, earnings for the half-year came in at S$0.392, up from S$0.12 in the year-ago period.

DBS, UOB & OCBC reported resilient 1Q results, showed growing reliance on wealth management

Singapore’s three local banks delivered resilient first-quarter 2026 results despite a softer interest-rate environment and geopolitical uncertainty. DBS reported a 1% rise in net profit to S$2.93 billion, supported by record total income, strong wealth management fees and healthy treasury customer flows.

The bank also raised its quarterly dividend to S$0.81 per share.

UOB’s performance was more mixed, with net profit easing 4% year-on-year to around S$1.4 billion as net interest margins narrowed, although wealth income and assets under management continued to grow steadily.

OCBC posted the strongest growth among the three, with net profit climbing 5% to S$1.97 billion, driven by robust fee income, wealth management activity and stronger non-interest income.

Overall, the results suggest that Singapore banks are increasingly relying on wealth management and fee-based businesses to offset slower loan-margin growth.

Singtel’s shares came under pressure despite seemingly strong results

Singtel reported FY26 net profit of $5.61 billion (a 40% year-on-year increase) and an underlying net profit of $2.77 billion (a 12% rise), driven by strong regional associates like Bharti Airtel. It declared a record total annual dividend of S$0.185 per share.

While full-year numbers looked solid, H2 net profit dropped 20.9% year-on-year to $2.2 billion, which overshadowed the better-than-expected full-year performance which was heavily boosted by one-off gains.

Singtel’s Singapore consumer business experienced persistent pressure due to aggressive price competition from four telco operators, which eroded prices and profitability.

The company issued cautious forecasts for fiscal year 2027, projecting low- to mid-single-digit profit growth. Analysts noted this was well below market estimates.

Singtel’s shares started the month at S$4.59 and rose to a month-high of S$5.02 but finished at S$4.34 for a net loss of S$0.25 or 5.4% in May.

Singapore factory output up 17.6% in April on AI-related electronics surge, beating forecasts

Singapore’s factory output jumped 17.6% year on year in April on a surge in electronics manufacturing from AI-related demand, exceeding the previous month’s downwardly revised 9.2% rise.

April’s performance beat forecasts by private-sector economists, who had predicted a median 12 per cent expansion in a Bloomberg poll.

Excluding the volatile biomedical manufacturing cluster, industrial production surged 21.5%, versus a revised 12.4% increase in March.

Economists believe resilient artificial intelligence-related tailwinds will support the Republic’s manufacturing growth in the near term, even as disruptions from the Middle East conflict continue to weigh down the chemicals cluster.

For example, in a Business Times report, Maybank economists Chua Hak Bin and Brian Lee said they expect the AI capital expenditure boom to be sustained into the second half of 2026.

This comes as major US hyperscaler tech firms ramp up capital expenditure guidance further in the latest earnings season, “implying that electronics growth will likely stay strong”, they said.

UOB associate economist Jester Koh said that April’s strong outturn supports the bank’s assessment that AI-related tailwinds will continue to bolster growth in the second and third quarters of 2026.

This will likely fully offset the associated drag from energy and petrochemical input supply disruptions due to the Middle East conflict, he added.

Koh Brothers Eco Engineering proposes transfer to SGX mainboard

Catalist-listed engineering solutions provider Koh Brothers Eco Engineering has proposed a transfer to the mainboard of the Singapore Exchange (SGX) to enhance the long-term value for its shareholders.

Koh Brothers Eco Engineering is a subsidiary of construction and property group Koh Brothers. The latter holds a 54.8% stake in the unit.

The board noted that Koh Brothers Eco Engineering has been listed on the Catalist board of SGX since Feb 27, 2006, and that the transfer “would better reflect the company’s current stage of development and future growth trajectory”.

Second, the board said the group “remains confident in navigating the evolving business environment”. It added that it will continue to strengthen strategic collaborations and adopt a “prudent yet proactive approach” in pursuing sustainable growth opportunities.

It noted that as at Dec 31, 2025, the group’s total order book across its engineering and construction segment, as well as bio-refinery and renewable energy segment, stands at a “healthy level” of an estimated S$1.1 billion.

Third, the board said a listing on the SGX mainboard will enhance the profile of Koh Brothers Eco Engineering locally and overseas. This is because public investors tend to place a premium on mainboard-listed companies compared to Catalist-listed companies.

Valuetronics’ 2H earnings fell 69.8% to HK$24.1

Electronics manufacturer Valuetronics, which earlier in the month issued a profit warning, last week reported that net profit fell 69.8% to HK$24.1 million (S$3.9 million) for its second half ended Mar 31.

This translated to earnings per share (EPS) of HK$0.059, a 69.7% year-on-year decline from HK$0.195. Revenue came in at HK$823.7 million, down 5%.

The declines came on the back of lower contributions from the consumer electronics segment, which posted H2 revenue of HK$84.3 million, down 51.4% from a year earlier.

Meanwhile, the industrial and commercial electronics segment’s H2 revenue rose 6.6% year on year to HK$739.4 million.

The group proposed a final dividend of HK$0.14 a share, and a special dividend of HK$0.16 a share.

Together with the total interim dividends of HK$0.08 a share, which were paid in December 2025, this brings Valuetronics’ total dividends declared for FY2026 to HK$0.38 a share.

For the full year, net profit fell 31.3% on year to HK$117.1 million from HK$170.4 million. Basic EPS declined 31% to HK$0.287.

Two weeks before the results announcement, Valuetronics issued a profit warning, citing non-cash impairments linked to Trio AI, a Hong Kong-based joint venture (JV) in which Valuetronics holds a 26.6% equity stake.

The company said it expected to recognise provisions against the carrying amount of its investment cost, advances made to the venture and outstanding receivables.

Additionally, Valuetronics said it would take a hit on graphics processing units (GPUs) and ancillary hardware deployed to Trio AI under an equipment leasing arrangement, as well as undeployed assets held by the broader group.