As we enter a new week, the Singaporean market braces for a series of pivotal financial disclosures from key players within the Straits Times Index (STI). The spotlight falls on the Oversea-Chinese Banking Corporation (OCBC), United Overseas Bank (UOB), Singapore Airlines (SIA), Keppel Corporation, and CapitaLand Ascendas Real Estate Investment Trust (REIT), as they prepare to unveil their latest financial achievements.
Singapore Airlines (SGX: C6L), maintaining a steady course, is currently positioned as a “hold”. We project a core net profit in the vicinity of S$480 million for the period spanning April to June, marking a slight descent from the S$554 million reported in the final quarter of the 2024 fiscal year (4QFY24). This forecasted dip is attributed to a marginal quarter-on-quarter (QoQ) reduction in passenger yield, which is somewhat counterbalanced by an uptick in cargo yields.
Turning our attention to Keppel Ltd (SGX: BN4), the recommendation to bolster investment positions stands firm. Expectations are set for a net profit of approximately S$445 million for the first half of the 2024 fiscal year (1H24), mirroring last year’s performance, with the infrastructure division propelling this stability.
The narrative for CapitaLand Ascendas REIT (SGX: A17U) echoes a similar sentiment of growth. Despite projecting a modest year-on-year (YoY) contraction in the 1H24 distribution per unit (DPU), attributed to a slight decrease in portfolio occupancy and strategic asset divestments, the forecast remains optimistic with anticipated positive rental reversions.
In addition to corporate earnings, the release of economic data will command attention. The unemployment rate, a barometer of economic health, is particularly noteworthy. The previous quarter (Q1 2024) has witnessed a subtle climb in Singapore’s seasonally adjusted unemployment rate to 2.1% — the highest since Q3 2022, yet still comfortably within bounds that avert recessionary concerns.
The financial community also awaits updates on the Money Supply M1 and M2. The preceding month (May) saw Money Supply M1 retract to S$269,690.80 million, with Money Supply M2 following suit, receding to S$797,803.60 million. Additionally, insights into Deposits and Balances of Residents Outside Singapore will be forthcoming.
Market analysts will keep a close watch on the purchasing managers index (PMI) and the electronics sector index. The Singapore Manufacturing PMI signaled a continuation of growth for the tenth consecutive month, albeit at a decelerated pace of 50.4 in June, compared to May’s 50.6. Conversely, the electronics PMI, a significant contributor to factory activity, exhibited a marginal increase to 51.2 in June from 51.1 in April.
As these corporate results and economic indicators unfold, they will collectively paint a picture of Singapore’s economic trajectory, providing investors with critical insights to steer their investment strategies and anticipate market dynamics.
Disclaimer: ProsperUs Manager of Content Hailey Chung doesn’t own shares of any mentioned companies.
Reference
Singapore Strategy | Positioning for 2QCY24 reporting season
