HSBC upgrades to Singapore's stock market to Overweight from Neutral for the second quarter. "With markets across the region stuck in a holding pattern, we believe Singapore provides a relatively safe haven," it says.
"Singapore is one of the more stable, low beta Asian markets with very low earnings volatility. The expected 2013 dividend yield of 3.5% -- with an appreciating Singapore dollar -- is in the upper end of the region's range, and one of the main attractions of the market."
"Singapore is one of the more stable, low beta Asian markets with very low earnings volatility. The expected 2013 dividend yield of 3.5% -- with an appreciating Singapore dollar -- is in the upper end of the region's range, and one of the main attractions of the market."
HSBC notes mutual-fund investors have rotated to underweight Singapore equities in relative terms, with their exposure at a five-year low and sell-side analysts are increasingly bearish on Singapore equities.
It notes the market trades at 14.3x 12-month forward P/E, a 1% discount to the 10-year average; with the consensus EPS growth estimates at just 2.1% for MSCI Singapore, high risks to earnings appear priced in, it says. It has an end-2013 STI target of 3,800.
It notes the market trades at 14.3x 12-month forward P/E, a 1% discount to the 10-year average; with the consensus EPS growth estimates at just 2.1% for MSCI Singapore, high risks to earnings appear priced in, it says. It has an end-2013 STI target of 3,800.
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