Wall Street’s rebound helped the STI rise 2.8%

Date: April 28, 2025

• The STI gained 9.1% in seven straight sessions before faltering on Thursday and Friday
• For the week, the index’s net gain was 2.3% at 3,823.78
• All three US indices rose for the week mainly on the absence of any negative tariff news, Nasdaq up 6.7%
• Yangzijiang’ shares rebounded after US eased port fees
• Sabana REIT unitholders reject all EGM resolutions
• Unitholders approve privatisation of Paragon REIT
• IMF cut Singapore’s 2025 growth forecast to 2%

 

The STI rallied 2.8% last week

Starting on Monday 14 April, the Straits Times Index rose for seven straight sessions before slipping last Thursday 24 April and again on Friday.

During those seven sessions, the index gained 320 points or 9.1% mainly due to an absence of adverse news on the US Tariff front rather than any positive, market-driving developments.

For the week, the index gained 103 points or 2.8% to close at 3,823.78, thanks as usual, mainly to the banks, Singtel, ST Engineering and Keppel.

How Wall Street fared – all three indices rose strongly, Nasdaq up 6.7%

After wobbling on Monday, US markets staged a four-day rally as sentiment was boosted by U.S. President Donald Trump significantly scaling back his aggressive rhetoric against Federal Reserve Chair Jerome Powell and China.

The first quarter earnings season took some of the spotlight away from tariffs. Market participants digested results from some of the world’s biggest companies, including a 71% plunge in quarterly net income by Tesla, a solid performance from Google parent Alphabet, a better-than-feared quarterly loss from troubled plane maker Boeing and a dismal quarter from beleaguered chip maker Intel.

For the week, gains in the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite were 2.5%, 4.6% and 6.7% respectively.

Yangzijiang’s shares rebounded after US eased rules on China-built ships

On Monday, shares of Yangzijiang Shipbuilding surged S$0.19 or 9.2% to S$2.25 following news that the US reduced its initial plan to slap port fees on China-built ships after pushback from the industry.

Yangzijiang had initially tumbled in February after the United States Trade Representative’s office proposed imposing a fee of up to US$1.5 million per port call on China-built vessels entering US ports.

After the changes, the new fees will take into effect after 180 days, from Oct 14. The fees will not depend on how many Chinese-built ships are in a fleet, and domestic exporters and vessel owners working in the Great Lakes, Caribbean and US territories will be exempt from the fees. Foreign roll-on/off operators will also be able to refund fees if they order a US built ship within the next three years.

The Business Times quoted analysts at Citi saying that these developments could partly lift market concerns over potential order cancellations or contract renegotiation.

“With lesser fees involved vs before and 180 days to adjust routes etc, there is room for the ship liners to manage costs and to pass through any additional costs to the end-receiver,” said analyst Luis Hilado.

For the week Yangzijiang gained a net S$0.14 or 6.8% at S$2.20.

Sabana REIT unitholders reject all EGM resolutions

All three resolutions tabled by some unitholders of Sabana Industrial Real Estate Trust (Sabana REIT) aimed at initiating a price discovery process with a view to selling the REIT’s properties, failed to pass at an extraordinary general meeting (EGM) held by its manager on Tuesday.

The EGM was convened after Charlie Chan, a former independent non-executive director, and other unitholders who collectively own about 20% of the trust’s units, submitted a requisition notice to the manager in January this year.

The first was for trustee HSBC Institutional Trust Services (Singapore) and the manager to commence and undertake a price discovery process, with a view of “achieving a possible sale of all or (the) majority” of the REIT’s assets.

This garnered 42.84% or 288,170,736 of the total number of votes cast by unitholders. This was less than half the votes required to pass the resolution.

Second was that the trustee and/or manager appoint an “internationally reputable” firm of property consultants “with a track record” of selling Singapore industrial properties to oversee the price discovery process.

Third, that Sabana REIT’s trustee and manager to complete the price discovery process within three months from the passing of the resolutions.

The unitholders had called for the EGM as they believed “significant costs” have been and continue to be incurred by the REIT in relation to the internalisation process of the manager. Unitholders had voted to internalise the management function of Sabana REIT in August 2023.

Unitholders approve privatisation of Paragon REIT

Unitholders of Paragon REIT approved the scheme resolution proposed by Cuscaden Peak’s Times Properties to take the trust private. Its delisting is expected on Jun 6, subject to regulatory approval.

During the scheme meeting on Tuesday, 1,000 unitholders or around 82.8% of those present and voting, agreed to the privatisation offer. This represented about 97.6% of units, well above the 50% required of total voting minority shareholders, as well as the required 75% in value of units.

The last day of trading for the counter is expected to be on or around May 14, followed by its record date on May 23 at 5 pm. Paragon REIT unitholders will receive the scheme consideration of S$0.98 a share in cash on or around 4 June.

IMF cut Singapore’s 2025 growth forecast to 2%

The International Monetary Fund (IMF) has cut its gross domestic product growth forecast for Singapore this year, citing the region’s exposure to the US tariff hit and uncertainty from the fallout.

Its real GDP growth forecast for Singapore is now 2% for 2025, from 4.4% achieved in 2024. Its previous forecast for 2025, released in October 2024, was 2.5%.

“Notwithstanding robust growth and inflation largely returning to targets in 2024, the outlook for the region has been downgraded in the near-term, in tandem with that for the global economy,” it said.

Earnings in brief

Keppel Infrastructure Trust (KIT) reported a jump in distributable income of 27.7% to S$65 million due to contributions from new acquisitions and capital recycling with the sale of Philippine Coastal, according to the company’s Q1 business update. The gain from the divestment of the 50% stake in Philippine Coastal – completed on Mar 20 – was S$21.7 million. However, the trustee-manager did note that its Q1 distributable income will decrease by 31.9% on the year to S$45.5 million after adjusting for one-offs. As at Mar 31, KIT’s net gearing stood at 40.8%, with interest coverage ratio at 6.8 times.

ESR-REIT  reported a 31.3% rise in net property income (NPI) for the first quarter to S$82.5 million and a 24.2% increase in revenue to S$110.5 million mainly due to contributions from two properties acquired in November 2024 – ESR Yatomi Kisosaki Distribution Centre in Mie, Japan, in which ESR-Reit holds a 100% trust beneficiary interest, and 20 Tuas South Avenue 14 in Singapore, in which it holds a 51% stake. Q1 distributable income was up 7% at S$44.2 million. Gearing stood at 41.9% as at March 2025. Total debt was at S$2.2 billion, down from S$2.3 billion as at December 2024.

OUE REIT’s revenue fell 11.9% to S$66 million for its first quarter ended Mar 31

mainly due to the divestment of Lippo Plaza in Shanghai, China, as well as lower contributions from the hospitality segment due to a weaker trading environment compared to the previous year. Net property income (NPI) fell 12.1% to S$53.2 million for the quarter. The weighted average cost of debt was down to 4.2% per annum as at Mar 31, 2025, from 4.7% per annum as at Dec 31, 2024 whilst financing costs also fell 11.3% to S$22.6 million in Q1 2025.

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