SG Morning Call｜Singapore Delays World First Green Flight Levy on Iran War

Market Snapshot

Singapore stocks opened higher on Thursday. STI up 0.2%; YZJ Shipbldg, OCBC up 1%.

Stocks in Focus

$Stoneweg EUTrust EUR(SET.SI)$: The trust has invested 50 million euros (S$74.1 million) in AiOnX, its sponsor SWI Group’s data centre development fund, via a mandatory convertible loan. The loan carries a 7.25 per cent annual cash coupon and is projected to provide a 2 per cent uplift to distributions per share on a pro forma basis, said the manager of Sert on Thursday. With this, Sert’s data centre allocation will rise from 5.2 per cent to about 7.2 per cent. Stapled securities of Sert closed flat at 1.50 euros on Wednesday.

$Lippo Malls Tr(D5IU.SI)$: The manager announced on Monday that with effect from Friday, LMIRT will be renamed to Landmark Real Estate Investment Trust. Units of LMIRT ended flat on Wednesday at S$0.006.

SG Local News

Singapore Delays World First Green Flight Levy on Iran War

Singapore is delaying a sustainable aviation fuel levy that airline customers were meant to start paying next month, citing the surge in fuel costs spurred by the Iran war.

Additional charges will now begin Oct. 1 as a result of the “impact of the ongoing conflict in the Middle East on airlines and passengers,” the Civil Aviation Authority of Singapore said Wednesday.

The amount charged will depend on the class of travel or length of flight, and could total as much as S$41.60 ($32.47) for passengers. Customers will pay an additional S$1 for trips to Southeast Asia, and S$10.40 for flights to the Americas, the authority confirmed last year.

Singapore Bonds Show Resilience as Iran War Roils Regional Peers

Singapore’s front-end bonds have emerged as a regional refuge amid the Iran war, outperforming Southeast Asian peers. Market watchers expect the trend to continue.

While the city-state’s economy isn’t immune to rising energy prices and supply chain disruptions from the Middle East conflict, robust domestic liquidity and a firm currency are among factors that have made its AAA rated bonds a more stable bet.

Yields on Singapore’s two-year government notes have risen by 16 basis points in March, the smallest increase in Southeast Asia, according to data compiled by Bloomberg. Similar-dated securities in Indonesia and the Philippines have seen yields surge by about five times more on bets their central banks will turn hawkish as the Iran war-driven oil shock adds to inflation risks.