Navigating Singapore 2022 - Reopening Is Inevitable, Be Prepared To Position For A Bounce In Market
- The period ahead calls for selective stock-picking, in our view, rather than over-hyping the gloom. We want to play the bounce in market and also look for outperformers in a sell-down market.
- Anchor themes:
- oversold reopening stocks;
- survivor of the fittest against inflation;
- earnings growth; and
- value picks.
- Our base case 2022 calendar year-end FSSTI target now stands at 3,506 (-0.5 standard deviation of its 10-year mean), as emergence of more virus variants could throw spanners into the works.
- Technical Outlook:
- Near-term view (next 3 to 6 months) – Oversold, bottoming out soon.
- Long-term view (next 12 months) – Uptrend intact.
- 5 reopening stocks that may be oversold
- We stay Overweight on sectors that post double-digit earnings growth, with room to buffer earnings miss, if any. Leading the growth trend is the Tech sector which we expect to see a three-year super-cycle with three-year average growth of 14% through to FY23F, led by strong demand orders. Telco is another sector that could emerge as an underdog in 2022, offering earnings swings of 24% (from 5% in 2021) and 19% through to 2023.
Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.
LIM Siew Khee CGS-CIMB Research | https://www.cgs-cimb.com 2021-12-03 2021-12-03
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