Market Snapshot
Singapore stocks opened lower on Wednesday. STI fell 0.4%; ComfortDelGro up 1.4%; Wilmar Intl up 1.7%; Olam Group up 1%; DBS Group down 0.65%; SIA down 0.58%.
Stocks in Focus
Thakral Corp: The mainboard-listed company on Tuesday announced the launch of an initial public offering (IPO) of GemLife Communities, an Australian over-50s lifestyle resort operator, to raise up to A$750 million (S$628.2 million) at an implied post-money valuation of A$1.58 billion. It is fully underwritten by JPMorgan and Morgan Stanley in Australia, which holds a 31.7 per cent effective interest in GemLife. Thakral intends to subscribe an additional 600,962 GemLife stapled securities at the IPO price of A$4.16 per stapled security, translating to a total of 64,000,962 GemLife stapled securities. Its shares closed 2 per cent or S$0.03 lower at S$1.44 on Tuesday, before the news.
Fu Yu: The components manufacturer on Tuesday said that it is actively seeking to appoint independent non-executive directors and has reached out to the Singapore Institute of Directors to invite suitable candidates to apply. This comes as all its independent directors resigned from the company’s board recently. It added that it has agreed to table resolutions for the removal and appointment of directors, in response to its largest shareholder’s request for it to do so under section 183 of the Companies Act 1967, having received legal advice that the request is valid and must be acted upon. The counter ended on Tuesday 5.3 per cent or S$0.005 lower at S$0.09.
SG Local News
Singapore May See Negative Growth by 2026 as Asean Reels from Tariffs: Bloomberg
The full impact of the escalating US tariffs on Asean’s growth will likely emerge in 2026 – and Bloomberg projects a sharp regional slowdown.
Gross domestic product growth across the Asean-5 economies – Singapore, Malaysia, the Philippines, Vietnam and Indonesia – is expected to fall from 4.5 per cent in 2024 to 3 per cent in 2025; Bloomberg Economics projected on Tuesday (Jun 17) that growth could even fade to 1.5 per cent in 2026 if the tariffs stay in place.
Among the five, Thailand and Singapore are likely to be hit the hardest because of their exposure to global trade, said Bloomberg’s senior economist for South-east Asia Tamara Henderson.
Singapore Banks Will Bear The Brunt of Lower Interest Rates, Says JP Morgan
The equity macro research team at JP Morgan (JPM), Khoi Vu, Rajiv Batra, Mervin Song, Terence M Khi and Harsh Wardhan Modi, finds that Singapore-focused REITs or stocks with resilient cashflows and leveraged balance sheets stand to gain from declining interest rates.
The team writes in their June 15 report: “While banks will bear the brunt of lower interest rates, we believe the sector could still be supported by resilient yields and strong inflows from domestic funds subscriptions.”
The upside from this, the team at JPM notes, will be best captured by Singapore REITs, due to lowering borrowing costs and their sheltering from factors typically experienced by overseas or trade-exposed REITs such as rising vacancies, falling prices and foreign exchange (forex) loss.