Mrzorro
12-03

STI Reaches 2007-Level Highs: What Lies Ahead?


The $Straits Times Index(STI.SI)$   has demonstrated robust growth in 2024, delivering a total return of 5.7% in the first half of the year and an additional 15.4% in the first five months of the second half. This impressive performance culminates in an 11-month total return of 21.9%, just 6% shy of its historic peak of 3,906.16 points in October 2007. This growth aligns with the strong economic momentum observed across Singapore and the ASEAN region.

In November, the STI index saw a price increase of 5.1% and a total return of 5.8%, with a significant 3.4% rise occurring within three trading days following the unexpected decisive outcome of the U.S. elections.


Investors are keenly analyzing the factors behind the STI's surge:


Short-term perspective:

The Manufacturing PMI in China reached a five-month high, signaling a potential economic revival. This news spurred gains across most Asian stock markets on Monday, December 2.

Singapore's Manufacturing PMI has expanded for 15 consecutive months as of November, with acceleration in growth. The electronics sector, in particular, has been a significant driver of this expansion, likely boosted by preemptive measures taken by businesses in anticipation of President Trump's substantial tariff hikes.


Long-term perspective:

The sustained high performance of the STI in November was largely driven by stellar Q3 results from the local banking trio—DBS, UOB, and OCBC—which have seen their stock prices soar by 52%, 36%, and 33% respectively year-to-date.

The table below illustrates the net institutional inflow and total returns for the top 10 most traded stocks in the first half and the first five months of the second half of 2024, predominantly focusing on the financial services, industrial, and real estate sectors.


Institutional Outlook:

Macquarie maintains a "constructive" view on the Singapore stock market for 2025. According to Macquarie's 2025 Strategic Outlook and Coverage report, the STI target is set at 4,000 points, with an expected EPS growth rate of 5%.

DBS Bank forecasts that external demand will continue to drive growth in manufacturing, trade-related services, and modern services next year. The electronics sector, accounting for nearly half of the manufacturing output, has led the economic growth in the latter half of this year and is expected to remain a key growth driver in the coming quarters. Furthermore, Singapore's critical role in the global semiconductor supply chain positions it to benefit from the growing global demand for AI data centers and servers, with the semiconductor market projected to grow by 12.5% next year.


@TigerStars @CaptainTiger  @TigerWire  @Daily_Discussion  @Tiger_chat  @Tiger_comments  @MillionaireTiger @Tiger_SG  

STI Hits ATH! Have You Profited From Cash Boost Account?
The Singapore stock market surged to a 17-year high on Tuesday, reaching 3,766 points. This milestone was primarily driven by a rebound in financial stocks, which hold significant weight in the index. ---------------- Which SG stock is your favorite? Have you tried contra account to trade SG stocks?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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