- We hold the view that the benchmark STI’s sharp recovery since the 9 Apr low is stalling. We identify five profit-taking opportunities for STI constituents whose strong price rebounds have tipped their share prices to trade close to/above our analysts’ 12-month target prices,
We identify 3 tariff negotiation outcomes.
Base case (55%):
- - Read this at SGinvestors.io -
- STI 2025 year-end target of 3,855.
Bear case (25%):
- US-China trade tensions worsen, countries forced to take sides, pause to 90-day rest-of-world (RoW) reciprocal tariffs end with few results, US economy enters stagflation, Singapore faces technical recession.
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Bull case (20%):
- US-China tariffs are significantly rolled back and remain so, RoW reciprocal tariffs set at 10% floor for most US key trading partners, Singapore GDP growth >2%,
- STI 2025 year-end target of 4,080.
Expect range-bound trade ahead.
- We are monitoring potential US tariffs policy shifts and their impact on company earnings. The initial effects should become clearer soon with the release of April economic data. We estimate a potential hit of 3.2%/4.9% to FY25F/FY26F earnings, respectively, for the Straits Times Index (STI) constituents. Industrials (e.g. SIA) and technology (e.g. Venture Corp) are most vulnerable while consumer staples (e.g. DFI Retail) and REITs are relatively shielded.
- The STI’s 13% rebound from its April low is stalling and is likely to turn sideways pending more clarity, with support at 3,700 and 3,635, and resistance at 3,820 and 3,865.
5 stocks to switch out, 7 to rotate into.
- Read more at SGinvestors.io.
