Weekly | Why SGX Lead the Market this Week?
As of the close on Friday, $Straits Times Index(STI.SI)$ closed at 3,746.02 points, up 0.04% points last week.
During the last 5 trading days, $SGX(S68.SI)$, $t PTTEP TH SDR(TPED.SI)$, $DFIRG USD(D01.SI)$, $YZJ Shipbldg SGD(BS6.SI)$ and $GLD SG$(GSD.SI)$ are the top 5 weekly gainers, up 11.65%, 8.96%, 6.84%, 5.91% and 5.53% respectively.
$Delta TH SDR 1to1(TDED.SI)$, $Sri Trang Gloves(STG.SI)$, $Alibaba HK SDR 5to1(HBBD.SI)$, $Frasers L&C Tr(BUOU.SI)$ and $TJ DaRenTang USD(T14.SI)$ are top 5 decliners of SGX stocks which market capital above S$1 Bln.
Below are key analyses of the TOP 5 gainers:
1. $SGX(S68.SI)$
Dividend Influence: SGX recently paid its dividend (ex-dividend date: November 7, 2024), which may have attracted dividend-focused investors. The current dividend yield is 2.88%, which is appealing to income investors.
Strong Financial Performance: SGX's diversified revenue streams, including equities, fixed income, derivatives, and market data services, have positioned it as a resilient player. The company benefits from robust demand for its derivatives and clearing services.
Market Sentiment: The broader positive sentiment in Asian markets and a favorable trading environment have also boosted SGX’s stock.
2. $t PTTEP TH SDR(TPED.SI)$
Energy Market Strength: The rebound in global oil prices following OPEC's decision to maintain production cuts has positively impacted oil and gas exploration companies like PTTEP. Higher oil and natural gas prices enhance revenue prospects for energy producers.
Valuation Attractiveness: PTTEP’s valuation metrics, including a low price-to-earnings ratio and strong free cash flow yield, have attracted value-focused investors. These metrics indicate that the stock is trading at an attractive price relative to its fundamentals.
Sector Trends: The broader energy sector is experiencing heightened demand, especially for natural gas, which forms a significant portion of PTTEP's business. This demand aligns with global trends toward cleaner energy sources.
3. $DFIRG USD(D01.SI)$
Strong Q3 2024 Performance: The company reported a 4% increase in net profit for Q3 2024, driven by effective cost management and improved operational efficiency across its key retail segments. This includes grocery stores, health and beauty outlets, and convenience stores under brands like Wellcome and 7-Eleven.
Positive Market Sentiment: Investor confidence was buoyed by DFI’s ability to maintain stable margins despite challenging conditions in Asia’s retail market. Its diversified retail portfolio has proven resilient, which supports future growth expectations.
Valuation and Growth Potential: DFI’s forward price-to-earnings (P/E) ratio of 17.17 and its recovery in operational metrics suggest strong earnings potential, making the stock attractive to investors.
4. $YZJ Shipbldg SGD(BS6.SI)$
Positive Financial Performance: Yangzijiang Shipbuilding recently reported strong financial results, including robust revenue growth and a net profit increase of 46.09% for FY2023. These numbers highlight the company's effective cost management and successful shipbuilding contracts, boosting investor confidence.
Industry Trends and Market Sentiment: The global shipbuilding industry is witnessing an upcycle, driven by increased demand for container ships and vessels supporting clean energy transport (e.g., LNG carriers). Yangzijiang Shipbuilding, with its advanced production capabilities, has been well-positioned to benefit from these trends.
Strategic Expansion and Cash Position: The company’s strong balance sheet, including a net cash position of SGD 3.02 billion, supports its ability to secure new contracts and fund future growth projects. This stability is attractive to both retail and institutional investors.
5. $GLD SG$(GSD.SI)$
Geopolitical and Economic Concerns: Continued geopolitical tensions and concerns about potential economic slowdowns globally have driven investors to seek refuge in gold. Gold is traditionally viewed as a hedge against uncertainty and inflation.
Interest Rate Expectations: Markets are speculating on potential rate cuts by central banks, which could weaken fiat currencies and make gold more attractive. The ETF's performance aligns with rising gold prices in response to these expectations.
Technical Factors: Technical patterns in gold-related assets, including ETFs like GSD, indicate strong bullish momentum. This reflects investor confidence in gold's resilience during uncertain times.
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