Strategy
Strategy: Monthly Market Radar
Thursday, 6 August 2026Singapore
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Highlights
- The STI surged 8.9% mom to 5,628.50, reaching a new all-time high of 5,713.19 on 29 July, supported by record-high bank shares and continued demand for Singapore’s defensive, high-yielding equities.
- Key events: Renewed US-Iran hostilities disrupted Strait of Hormuz oil flows and lifted Brent crude, Fed held rates despite three policymakers favouring a hike, MAS tightened policy, Keppel’s offshore fund transaction.
- Key upcoming events: MSCI Review (12 August), National Day rally (23 August), Jackson Hole Economic Symposium (27-29 August), 1H26 results (ongoing).
Analysis
- STI performance. The Straits Times Index (STI) rose 458pt (+8.9% mom) to close at 5,628.50, setting a record closing high of 5,713.19 on 29 July before easing in the final week. Gains were led by a 13% rally in the banking sector, plantation, property and marine stocks, while semiconductor names lagged. The momentum was also supported by retail investors in July, with net inflows of S$545m offsetting institutional outflows of S$464m. Buying was focused on transport, infrastructure and industrial names, while institutional selling reflected portfolio rebalancing.
- US-Iran tensions reinforce higher rates. Renewed disruptions around the Strait of Hormuz lifted oil and freight costs, reviving global inflation concerns and weighing on risk sentiment. Brent rose 29% in July to reach around US$94/bbl. The FOC held the federal funds rate at 3.50-3.75%, but three policymakers favoured a hike, shifting market expectations towards a potential further tightening later in 2026 if inflation remains elevated.
- AI demand drives NODX growth. Singapore’s non-oil domestic exports (NODX) rose 20.7% yoy, driven by a 105% surge in the electronics sector, supported by robust global demand for AI-related products. Non-electronic exports declined 2.9%, weighed down by weaker shipments of petrochemicals and food preparations. Singapore continued to benefit from the global AI and semiconductor upcycle, with exports to key markets such as Malaysia, South Korea, Taiwan, Thailand and the US posting strong gains.
- MAS tightens policy. MAS tightened policy again, slightly increasing the rate of appreciation of the S$NEER policy band, leaving its width and midpoint unchanged. The move aimed to contain renewed imported inflation pressures from higher global energy prices and stronger-than-expected economic growth, with Singapore’s GDP expanding 5.7% yoy in 2Q26. MAS expects core inflation to begin picking up from July and remain elevated into early-27.
Corporate and market catalysts during the month included:
- Banks propelled the STI to successive records. DBS, OCBC and UOB reached all-time highs, benefitting from safe-haven inflows, expectations of sustained higher rates, resilient margins and strong dividend appeal.
- SGX broadened access to global equities. SGX introduced Singapore Depository Receipts for SpaceX, Grab and Sea, allowing investors to trade exposure to the companies in Singapore dollars during market hours.
- Keppel accelerated its asset monetisation. Keppel agreed to divest six offshore rigs, raising S$478m in cash and increasing assets under management by around S$3.9b.
Action
- Our top large-cap picks are CIT, KEP, NTTDCR, OCBC, SIE, UIBREIT and VMS. For small-/mid-cap companies, our top picks are BKM, FEH, HLA, HUAGL, OTEK, RSTON, UGAI and VALUE.
Strategy
Strategy: Monthly Market Radar
Thursday, 6 August 2026Singapore
Share
Highlights
- The STI surged 8.9% mom to 5,628.50, reaching a new all-time high of 5,713.19 on 29 July, supported by record-high bank shares and continued demand for Singapore’s defensive, high-yielding equities.
- Key events: Renewed US-Iran hostilities disrupted Strait of Hormuz oil flows and lifted Brent crude, Fed held rates despite three policymakers favouring a hike, MAS tightened policy, Keppel’s offshore fund transaction.
- Key upcoming events: MSCI Review (12 August), National Day rally (23 August), Jackson Hole Economic Symposium (27-29 August), 1H26 results (ongoing).
Analysis
- STI performance. The Straits Times Index (STI) rose 458pt (+8.9% mom) to close at 5,628.50, setting a record closing high of 5,713.19 on 29 July before easing in the final week. Gains were led by a 13% rally in the banking sector, plantation, property and marine stocks, while semiconductor names lagged. The momentum was also supported by retail investors in July, with net inflows of S$545m offsetting institutional outflows of S$464m. Buying was focused on transport, infrastructure and industrial names, while institutional selling reflected portfolio rebalancing.
- US-Iran tensions reinforce higher rates. Renewed disruptions around the Strait of Hormuz lifted oil and freight costs, reviving global inflation concerns and weighing on risk sentiment. Brent rose 29% in July to reach around US$94/bbl. The FOC held the federal funds rate at 3.50-3.75%, but three policymakers favoured a hike, shifting market expectations towards a potential further tightening later in 2026 if inflation remains elevated.
- AI demand drives NODX growth. Singapore’s non-oil domestic exports (NODX) rose 20.7% yoy, driven by a 105% surge in the electronics sector, supported by robust global demand for AI-related products. Non-electronic exports declined 2.9%, weighed down by weaker shipments of petrochemicals and food preparations. Singapore continued to benefit from the global AI and semiconductor upcycle, with exports to key markets such as Malaysia, South Korea, Taiwan, Thailand and the US posting strong gains.
- MAS tightens policy. MAS tightened policy again, slightly increasing the rate of appreciation of the S$NEER policy band, leaving its width and midpoint unchanged. The move aimed to contain renewed imported inflation pressures from higher global energy prices and stronger-than-expected economic growth, with Singapore’s GDP expanding 5.7% yoy in 2Q26. MAS expects core inflation to begin picking up from July and remain elevated into early-27.
Corporate and market catalysts during the month included:
- Banks propelled the STI to successive records. DBS, OCBC and UOB reached all-time highs, benefitting from safe-haven inflows, expectations of sustained higher rates, resilient margins and strong dividend appeal.
- SGX broadened access to global equities. SGX introduced Singapore Depository Receipts for SpaceX, Grab and Sea, allowing investors to trade exposure to the companies in Singapore dollars during market hours.
- Keppel accelerated its asset monetisation. Keppel agreed to divest six offshore rigs, raising S$478m in cash and increasing assets under management by around S$3.9b.
Action
- Our top large-cap picks are CIT, KEP, NTTDCR, OCBC, SIE, UIBREIT and VMS. For small-/mid-cap companies, our top picks are BKM, FEH, HLA, HUAGL, OTEK, RSTON, UGAI and VALUE.
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