SGX Market Updates

Singapore Banks Attract Net Institutional Inflows in Early 4Q20


PUBLISHED ON |

19 October 2020

  • Recent weeks have seen more evidence that the Singapore economy is sequentially and gradually recovering from record that lows in economic activity observed in 2Q20 that were attributed to stringent circuit breaker measures to contain COVID-19 infections.

  • Over the first two weeks of 4Q20, STI Heavyweights DBS, OCBC and UOB were recipient to S$217 million in net institutional inflows, with the trio averaging 5% gains. Key bank sector themes include domestic and external economic drivers, ability to generate income, tier 1 capital to risk-weighted assets & NPLs.

  • Of Singapore’s 100 most traded stocks in 2020, healthcare supply stocks have again started 4Q20 as the strongest contingent of stocks, with Medtecs International, UG Healthcare, iX Biopharma, Sri Trang Agro, Riverstone and Top Glove Corp averaging 17% total returns.




Singapore’s official growth expectation for 2020 remains unchanged with a contraction of -5% to -7% from 2019 levels. The three key sectors that continue be impacted the most are travel-related, consumer-facing domestic services and construction. On the latter, advanced estimates for Singapore’s construction sector in 3Q20 showed a 44.7% decline from 3Q19, attributed to a slow resumption of construction activities due to the need for construction firms to implement safe management measures for a safe restart. From 2Q20 however, the construction sector grew by 38.7%, underlying the sequential recovery. The preliminary 3Q20 URA Private Home Price Index also gained 0.8% from 2Q20, which in turn gained 0.3% from 1Q20.

On the consumer-facing domestic services front, Singapore’s August retail sales declined 6% from August 2019, but rose 1.4% from July and the August F&B Services Index was down 3% in August from July, but was up 29% in July compared to June. Like SIPMM reports, Singapore’s NODX report last week also relayed more evidence of a path of sequential and gradual recovery Singapore’s economy. 

Currently the economy is seeing most job creation in information and communications, food services, professional services, healthcare, and finance and insurance. While Singapore’s services component of GDP is well diversified over industries that encompass wholesale and retail trade, business services, finance and insurance, transportation, information and communications, the immediate outlook for those sectors is uneven, with very different operating conditions for transportation as opposed to information and communications. 

With the uneven aspect of the recovery, also referred to as a K-recovery, there have been some significant highlights that include Singapore’s Electronics PMI at the highest level since September 2018 and September outbound shipments to Malaysia rising close to 30% YoY, which was the strongest growth pace since April 2010.  

Over the first two weeks of 4Q20, STI Heavyweights DBS Group Holdings, Oversea-Chinese Banking Corp and United Overseas Bank were recipient to S$217 million in net institutional inflows, with the trio averaging 5% gains. In 2020 accommodative monetary policy and economic lockdowns have meant that global banks have had to contend with a sudden reduction in interest rate margins and overall demand for financing, while needing to boost loan provisions, hence uniform drivers have seen parallel performances of banking sectors across the globe. This year’s declines in the three banks have been highly correlated with the top quartile of global banks by market value throughout 2020.

Key Banking Sector themes continuing into 2021 include domestic and external economic drivers, bank abilities to generate income, tier 1 capital to risk-weighted assets and non-performing loan ratios. The Singapore trio have gradually increased quarterly net Interest Income to above S$4 billion in 2QFY15 and above S$5 billion in 2QFY18, maintaining a combined Net Interest Income of S$5.4 billion in 2QFY20. Will also add that on that ability to generate income since 2010, DBS, OCBC & UOB have increased their combined annual income that is segmented to Greater China by 175% with the combined Greater China income grew from S$2.33 billion in 2010, to S$6.42 billion in 2019.

Of Singapore’s 100 most traded stocks in 2020, healthcare supply stocks have again started 4Q20 as the strongest contingent of stocks, with Medtecs International, UG Healthcare, iX Biopharma, Sri Trang Agro, Riverstone and Top Glove Corporation averaging a 17% total return bringing their media total return in the 2020 year to date to 408%. In its FY21 outlook, Top Glove Corporation Bhd management noted that without a readable vaccine to COVID-19, much of the momentum of the Rubber Glove Sector will continue to be in trader’s focus. With COVID-19, Top Glove estimates that glove demand will grow by 20% per annum in 2020, 25% in 2021 and 15% post-COVID-19, noting that notwithstanding news of several promising vaccines in the pipeline, glove demand remains at a supernormal level, as gloves will still be required even when a vaccine becomes available. 


Singapore’s 100 most traded stocks in the 2020 year to date are tabled below and sort by highest net institutional inflow in the 4Q-to-date. 

Stock SGX
Code
Mkt Cap
S$M
QTD
Total
Return
QTD Net
Institutional
Inflow
(S$M)
YTD
Total
Return
YTD Net
Institutional
Inflow
(S$M)
Sector
DBS D05 54,359 7% 156.5 -14% -1,311.0 Financial Services
SingTel Z74 35,434 2% 37.3 -34% -880.1 Telecommunications
UOB U11 32,787 3% 32.0 -22% -1,497.7 Financial Services
OCBC Bank O39 39,091 4% 28.0 -16% -900.1 Financial Services
Ascendas REIT A17U 11,693 0% 16.5 12% 373.2 REITs
Wilmar International F34 28,559 2% 16.5 13% 29.4 Consumer Non-Cyclicals
CapitaLand Mall Trust C38U 7,048 -1% 15.3 -20% -166.3 REITs
SGX S68 9,855 1% 9.0 6% 198.8 Financial Services
Mapletree Logistics Trust M44U 7,889 1% 8.7 22% 111.0 REITs
CapitaLand C31 14,332 2% 7.6 -23% -132.5 Real Estate (excl. REITs)
SIA C6L 10,407 1% 7.3 -45% -637.6 Industrials
ComfortDelGro C52 3,163 4% 6.3 -36% -341.3 Industrials
Mapletree Commercial Trust N2IU 6,363 -1% 3.8 -19% -55.7 REITs
CapitaLand Commercial Trust C61U 6,372 1% 3.0 -14% 54.2 REITs
Keppel Corp BN4 8,288 2% 2.9 -31% -111.7 Industrials
Venture Corp V03 6,026 8% 2.1 34% 264.0 Technology (Hardware/ Software)
Jardine Matheson J36 40,663 2% 2.1 -23% -34.6 Industrials
Mapletree Industrial Trust ME8U 7,474 -1% 1.9 26% 32.8 REITs
Genting Singapore G13 8,083 0% 1.9 -25% 87.6 Consumer Cyclicals
Yangzijiang Shipbuilding BS6 3,776 -2% 1.8 -9% -44.5 Industrials
ST Engineering S63 11,186 4% 1.5 -5% 85.3 Industrials
Medtecs International 546 725 22% 1.3 3501% 5.7 Healthcare
SATS S58 3,393 7% 1.3 -40% -235.1 Industrials
Suntec REIT T82U 4,034 -1% 1.2 -19% -64.9 REITs
AEM AWX 995 -6% 0.7 83% 44.7 Technology (Hardware/ Software)
City Developments C09 7,010 2% 0.5 -28% -155.7 Real Estate (excl. REITs)
Thai Beverage Y92 14,567 -4% 0.5 -33% -208.7 Consumer Non-Cyclicals
Keppel DC REIT AJBU 4,964 4% 0.5 50% 57.9 REITs
SPH T39 1,606 -3% 0.4 -53% -167.5 Consumer Cyclicals
Hongkong Land H78 11,915 1% 0.4 -30% -127.5 Real Estate (excl. REITs)
Sembcorp Industries U96 2,573 7% 0.4 27% -158.5 Utilities
Jardine C&C C07 7,043 -1% 0.2 -38% -151.2 Consumer Cyclicals
Frasers Logistics & Commercial Trust BUOU 4,643 -2% 0.2 14% 66.8 REITs
Jardine Strategic J37 29,751 -1% 0.1 -34% -35.1 Industrials
NetLink NBN Trust CJLU 3,800 0% 0.1 6% -22.7 Telecommunications
UOL U14 5,729 2% 0.1 -16% 21.7 Real Estate (excl. REITs)
Riverstone AP4 2,883 11% 0.0 326% -7.9 Healthcare
Mapletree North Asia Commercial Trust RW0U 2,919 -4% 0.0 -20% -52.6 REITs
Keppel REIT K71U 3,603 -1% 0.0 -11% 18.4 REITs
Frasers Centrepoint Trust J69U 3,178 0% 0.0 -14% -25.1 REITs
Ascott Residence Trust HMN 2,763 0% 0.0 -30% -24.1 REITs
Rex International 5WH 182 -1% -0.1 -32% -0.5 Energy/ Oil & Gas
UMS 558 544 4% -0.1 4% 10.0 Technology (Hardware/ Software)
Dairy Farm International D01 6,979 0% -0.1 -29% -61.3 Consumer Non-Cyclicals
UG Healthcare 8K7 621 21% -0.1 2064% -3.0 Healthcare
Sheng Siong OV8 2,496 3% -0.2 38% -9.6 Consumer Non-Cyclicals
ESR-REIT J91U 1,364 0% -0.2 -24% -10.5 REITs
Sembcorp Marine S51 1,795 -2% -0.2 -83% -30.6 Industrials
Top Glove BVA 24,836 11% -0.2 490% -45.7 Healthcare
CapitaLand Retail China Trust AU8U 1,565 14% -0.3 -17% -106.3 REITs
Manulife REIT BTOU 1,590 0% -0.5 -21% -20.6 REITs
CDL Hospitality Trusts J85 1,318 3% -0.6 -30% -69.3 REITs
Keppel Infrastructure Trust A7RU 2,770 2% -0.6 8% -4.1 Utilities
Golden Agri-Resources E5H 1,828 1% -0.6 -36% -6.3 Consumer Non-Cyclicals
Lendlease REIT JYEU 785 -1% -0.7 -25% -65.8 REITs
Hi-P International H17 1,025 8% -0.8 -15% -9.4 Industrials
ParkwayLife REIT C2PU 2,474 -1% -0.8 27% 34.6 REITs
StarHub CC3 2,130 2% -1.0 -10% -2.3 Telecommunications
Frencken E28 443 6% -1.0 16% -4.9 Industrials
Ascendas India Trust CY6U 1,641 4% -1.1 -4% -3.8 REITs
Cromwell European REIT CNNU 1,932 -3% -1.2 0% -7.5 REITs
Biolidics 8YY 86 3% -1.4 33% -5.2 Healthcare
Vicplas International 569 165 5% -1.7 249% 0.9 Healthcare
SPH REIT SK6U 2,280 -6% -1.8 -22% -4.1 REITs
Singapore Post S08 1,519 5% -1.8 -26% -13.5 Industrials
Yanlord Land Z25 2,163 -1% -1.9 -2% -12.3 Real Estate (excl. REITs)
Clearbridge 1H3 96 1% -2.1 14% -1.2 Healthcare
Keppel Pacific Oak US REIT CMOU 907 -3% -2.1 -3% -5.2 REITs
Sri Trang Agro NC2 2,028 14% -2.2 212% -44.5 Consumer Cyclicals
Alset 40V 95 2% -2.4 42% -2.5 Real Estate (excl. REITs)
Yoma Strategic Z59 582 -9% -2.6 -26% -23.5 Real Estate (excl. REITs)
Synagie V2Y 61 -1% -2.8 53% 4.1 Technology (Hardware/ Software)
AIMS APAC REIT O5RU 869 2% -2.9 -10% -18.4 REITs
Hyphens Pharma 1J5 126 8% -3.0 109% -6.4 Healthcare
Sasseur REIT CRPU 933 1% -3.1 -7% -29.7 REITs
First REIT AW9U 350 0% -3.6 -54% -27.9 REITs
Hutchison Port Holdings Trust NS8U 1,632 -16% -4.3 -11% -10.4 Industrials
Japfa UD2 1,342 9% -4.3 16% 2.3 Consumer Non-Cyclicals
Prime US REIT OXMU 1,197 1% -4.4 -6% -11.6 REITs
Haw Par H02 2,096 2% -7.2 -24% -40.1 Healthcare
ISDN I07 172 3% -7.6 75% -5.3 Industrials
Starhill Global REIT P40U 966 0% -8.0 -37% -43.6 REITs
CSE Global 544 238 0% -8.0 -11% -16.3 Technology (Hardware/ Software)
Valuetronics BN2 252 3% -9.5 -26% -20.1 Technology (Hardware/ Software)
IFAST AIY 873 35% -9.7 215% -8.2 Financial Services
IX Biopharma 42C 186 20% -10.2 20% -2.3 Healthcare
First Resources EB5 1,958 2% -10.5 -33% -4.9 Consumer Non-Cyclicals
Silverlake Axis 5CP 735 -2% -11.6 -30% -30.4 Technology (Hardware/ Software)
ARA LOGOS Logistics Trust K2LU 697 3% -11.8 -5% -14.8 REITs
Far East Hospitality Trust Q5T 1,097 2% -11.9 -22% -15.2 REITs
Raffles Medical BSL 1,482 -2% -11.9 -18% -7.3 Healthcare
Accordia Golf Trust ADQU 797 0% -16.1 13% -5.1 Consumer Cyclicals
SIA Engineering S59 1,918 2% -19.8 -38% -14.7 Industrials
Jiutian Chemical C8R 116 33% -20.4 276% 2.2 Materials & Resources
Broadway Industrial B69 51 1% -21.6 -19% 0.9 Industrials
IPS Securex 42N 41 6% -23.3 110% -1.1 Technology (Hardware/ Software)
OUE Commercial REIT TS0U 1,868 -3% -23.4 -36% -25.2 REITs
Aspen 1F3 231 42% -24.3 197% -12.9 Real Estate (excl. REITs)
Olam International O32 4,122 2% -24.5 -25% -34.6 Consumer Non-Cyclicals
Avarga U09 241 9% -44.8 73% -9.8 Materials & Resources
Average     3%   70%  
Median     2%   -13%  

Source: SGX, Bloomberg, Reuters (Data as of 15 October)







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