While the STI has generated an 8.6% total return in 2019 YTD, two-thirds of Singapore’s 100 most actively traded stocks by turnover outpaced the benchmark with total returns above 8.6%. The 100 stocks on a whole, generated a median total return of 17.5% and average total return of 23.5%.
Net institutional inflows were led by five STI stocks: SingTel, SGX, Wilmar Intl, CapitaLand and ThaiBev, which averaged total returns of 32%. The Consumer Goods Sector accounted for two of these stocks, with the Sector also largely attributing to last month’s expansion in the Global Manufacturing PMI.
A cautious macro outlook carries into 2020, with the global GDP growth forecast to pick up to 3.4%, following a possible 10 year low of 3.0% in 2019. Key drivers into 2020 remain changing consumer markets, technology growth, low interest rates, and from a micro perspective, agility and adaptability.
The STI has generated an 8.6% total return in the 2019 year-to-date, in-line with its 9.2% average annualised total return for the preceding 10 years going into 2019. For much of the year, the US Dollar Index continued to built on its gains in 2018, which coincided with the regional FTSE ASEAN All-Share Index generating a 6.0% total return in the 2019 year-to-date.
As a group, Singapore’s 100 most actively traded stocks by turnover outpaced the STI benchmark with a median total return of 17.5% and average total return of 23.5%. The 100 stocks were also the combined recipient of S$1.1 billion in net institutional inflows. Exactly two-thirds of the 100 stocks, outpaced the STI in the year-to-date with total returns above 8.6%.
Global Manufacturing PMI Underpins Current 2020 Outlooks
The above returns have corresponded with the global GDP growth forecast by the IMF to be at 3.0% in 2019. This represents a 10-year low, which is expected to pick up to 3.4% in 2020. In Singapore, the MAS Economic Policy Group expect the Singapore economy to grow by 0.5% to 1.0% in 2019 and pick up modestly in 2020 to 0.5% to 2.5%. This is alongside a projected recovery in the global electronics cycle.
Last month, the global manufacturing JP Morgan Global Manufacturing PMI edged back into expansion territory, to 50.3, after spending the preceding six months in contraction. While the report maintained that last month’s PMI recovery was centered on the Consumed Goods sector, there have been other anecdotal signs of recovery in technology-related clusters:
UMS Executive Chairman and CEO Andy Luong noted in Nov that there were signs of an upturn in the overall semiconductor industry as demand is picking up, with chip inventories easing, and new technological disruptors driving the growth of new products and capabilities.
- Also in Nov, Frencken Group expressed some confidence that in the long term the global technology sector will continue to benefit from the positive market trends in cloud computing, big data, artificial intelligence, the Internet of Things and life sciences.
In addition, continuous digitalisation efforts and cloud deployments have supported Data Centre expansions across the world in 2019. On Sep 16, Keppel DC REIT launched a private placement to fund Data Centre acquisitions which was fully covered within the first hour of bookbuilding, and ended being nine times covered. Prior to this, Equinix Inc, had led the returns of the world’s largest 100 REITs by market value, and outpaced Keppel DC REIT in 2019 returns by 16%. Since then, Singapore’s largest Data Centre REIT has caught up with the world’s largest Data Centre REIT, with both stocks generating 60% year-to-date total returns.
Expansions in 2019
Before the market can focus on Phase 2 of the US-China trade deal, implementation of Phase 1 will be watched closely. While most of 2019 saw uncertainty on a US-China trade resolution, there were reports manufacturing and/or international companies were exploring new initiatives to offset that uncertainty. For instance, Valuetronics Holdings noted that in anticipation of customers changing needs in a challenging environment, the Group had in early 2019 embarked on an expansion plan to expand its manufacturing footprint to Vietnam to provide customers with an alternate manufacturing platform outside China. The Group’s first leased manufacturing facility in Vietnam had begun mass production in June 2019 and shipments have since been made from Vietnam to the US market.
Hence while a cautious macro outlook carries over into 2020, this past year saw plenty of sub-themes, such as changing consumer markets, technology driven growth, low interest rates which had varied impact on different market segments. From a micro viewpoint, business agility, adaptability and operational efficiency remained key business drivers.
At the same time, headline growth outlooks have become increasingly synchronous, particularly across large or open economies with strong global links through financial services, technology, trade and logistics. This means that key economic developments and big policy measures to support growth, such as accommodative Federal Reserve measures or China’s counter-cyclical measures, did see similar market impacts across much of the globe.
Globally, REITs outpaced Banks with the lower interest rate outlook for much of 2019. The median total return of all REITs listed across the was 18% (with average total return of 20%) as of Dec 16. In Singapore, the iEdge SREIT Index generated a 24.8% total return.
Beyond the performances, portfolio acquisitions have seen Singapore REITs and Property Trusts raise a record S$7.7 billion in secondary fundraising in the 2019 year-to-date, up from the previous record of S$4.3 billion in 2018. This includes the Keppel DC REIT private placement discussed above. 3 of the 4 REITs that listed on SGX this year have also ranked amongst ASEAN’s 5 largest IPOs in 2019 by deal size.
Net institutional inflows totalled S$1.1 billion in the 2019 year-to-date and were led by 5 STI stocks: SingTel, SGX, Wilmar International, CapitaLand and Thai Beverage, which averaged total returns of 32%. The 100 most traded stock by turnover in the 2019 year-to-date are tabled below, with the table ranked in order of turnover.
As discussed above the median return of the 100 most traded stocks by turnover was approximately double the return of the STI over the period and as many as two-thirds of the 100 stocks individually outpaced the STI. Of the 100 stocks, the 10 strongest performances in the 2019 year-to-date were generated by non-STI stocks that included Global Invacom Group, Catalist-Listed Rex International Holding, AEM Holdings, Frencken Group, Sunpower Group, UMS Holdings, Hi-P International, Keppel DC REIT, Ascendas Hospitality Trust and Sasseur REIT.
Turnover in 2019
|DBS GROUP HOLDINGS||D05||65,641||15||16||101.9||-218|
|UNITED OVERSEAS BANK||U11||44,077||13||16||61.6||-129|
|OVERSEA-CHINESE BANKING CORP||O39||48,028||1||14||56.5||-229|
|ASCENDAS REAL ESTATE INV TRT||A17U||10,507||22||15||35.7||-27|
|CAPITALAND MALL TRUST||C38U||8,890||11||17||25.7||-44|
|CAPITALAND COMMERCIAL TRUST||C61U||7,600||18||16||25.0||40|
|MAPLETREE COMMERCIAL TRUST||N2IU||7,506||45||20||23.6||-14|
|JARDINE MATHESON HLDGS||J36||54,515||-20||25||20.0||-18|
|HONGKONG LAND HOLDINGS||H78||17,880||-9||24||20.0||-102|
|MAPLETREE LOGISTICS TRUST||M44U||6,379||41||18||18.8||32|
|SINGAPORE TECH ENGINEERING||S63||12,311||18||17||17.0||171|
|THAI BEVERAGE PCL||Y92||22,728||52||29||15.3||194|
|MAPLETREE NORTH ASIA COMMERCIAL||RW0U||3,642||6||21||12.3||-32|
|JARDINE STRATEGIC HLDGS||J37||46,503||-15||24||12.3||1|
|MAPLETREE INDUSTRIAL TRUST||ME8U||5,502||38||16||11.4||14|
|JARDINE CYCLE & CARRIAGE||C07||12,078||-10||23||10.9||-23|
|SINGAPORE PRESS HOLDINGS||T39||3,349||-6||21||10.5||4|
|KEPPEL DC REIT||AJBU||3,277||60||21||8.8||1|
|FRASERS LOGISTICS & INDUSTRI||BUOU||2,688||23||20||8.4||24|
|NETLINK NBN TRUST||CJLU||3,644||29||13||7.9||-18|
|DAIRY FARM INTL HLDGS||D01||10,738||-34||27||6.7||-34|
|FRASERS CENTREPOINT TRUST||J69U||2,984||29||18||5.9||10|
|ASCOTT RESIDENCE TRUST||A68U||2,920||32||15||5.1||68|
|REX INTERNATIONAL HOLDING||5WH||245||242||67||4.6||2|
|KEPPEL INFRASTRUCTURE TRUST||A7RU||2,722||22||17||3.9||1|
|FRASERS COMMERCIAL TRUST||ND8U||1,491||27||18||3.8||17|
|CDL HOSPITALITY TRUSTS||J85||1,952||17||15||3.3||-12|
|CAPITALAND RETAIL CHINA TRUS||AU8U||1,898||25||17||3.1||-4|
|EAGLE HOSPITALITY TRUST||LIW||631||-33||40||2.6||-81|
|YANLORD LAND GROUP||Z25||2,260||1||29||2.5||-16|
|MANULIFE US REAL ESTATE INV||BTOU||2,125||41||16||2.5||4|
|CROMWELL EUROPEAN REIT||CNNU||2,000||23||21||2.2||-23|
|AIMS APAC REIT||O5RU||983||14||15||2.0||-16|
|HUTCHISON PORT HOLDINGS TR-U||NS8U||1,982||-26||30||1.9||-4|
|FIRST REAL ESTATE INVT TRUST||AW9U||794||10||19||1.9||-81|
|ASCENDAS INDIA TRUST||CY6U||1,749||51||23||1.7||-6|
|STARHILL GLOBAL REIT||P40U||1,583||13||14||1.7||29|
|SHENG SIONG GROUP||OV8||1,879||22||15||1.7||23|
|ASCENDAS HOSPITALITY TRUST||Q1P||1,275||54||17||1.6||47|
|PARKWAYLIFE REAL ESTATE||C2PU||1,948||28||14||1.6||12|
|SIA ENGINEERING CO||S59||3,170||30||21||1.5||-6|
|LENDLEASE GLOBAL COMMERCIAL||JYEU||1,086||6||17||1.5||-34|
|FAR EAST HOSPITALITY TRUST||Q5T||1,389||25||17||1.4||7|
|CACHE LOGISTICS TRUST||K2LU||768||10||17||1.4||1|
|SASSEUR REAL ESTATE INVESTME||CRPU||1,071||53||18||1.2||-23|
|RAFFLES MEDICAL GROUP||BSL||1,791||-9||17||1.2||-21|
|KEPPEL PACIFIC OAK US REIT||CMOU||981||39||17||1.1||-9|
|ASIAN PAY TELEVISION TRUST||S7OU||243||43||39||1.0||-1|
|YOMA STRATEGIC HLDGS||Z59||781||3||38||1.0||3|
|COSCO SHIPPING INTERNATIONAL||F83||705||-5||33||1.0||9|
|GLOBAL INVACOM GROUP||QS9||42||340||130||1.0||1|
|CHINA AVIATION OIL SINGAPORE||G92||1,075||22||26||0.9||-5|
|OUE COMMERCIAL REIT||TS0U||2,989||29||18||0.9||35|
|HAW PAR CORP||H02||2,851||16||17||0.9||-9|
|CHINA EVERBRIGHT WATER||U9E||915||10||48||0.8||-8|
|THOMSON MEDICAL GROUP||A50||1,586||-18||28||0.8||14|
|YING LI INTERNATIONAL||5DM||258||-13||32||0.8||13|
|CHIP ENG SENG CORP||C29||477||-3||19||0.7||-12|
|WING TAI HOLDINGS||W05||1,530||6||12||0.7||-9|
|EC WORLD REIT||BWCU||609||19||13||0.7||-34|