Weekly Review with SIAS - US stocks reach all-time high

What happened?

In this week's Weekly Market Review in partnership with Securities Investors Association Singapore (SIAS), we discuss the performance of the global equity market and also share more about the following:

• SIA
• Mapletree Logistics Trust
• Mapletree Pain-Asia Commercial Trust

Watch the video to learn more about what we are looking out for this week.

Weekly market review

1:44 - Macro update

Fairly positive market backdrop

The S&P 500 rose 1.5% last week, with the Dow Jones breaching the 40,000 level. The Nasdaq gained 2.1% as well.

The US core inflation rate for April came in at 3.6%, below market expectations and continuing a downward trend over the past 12 months. This data point fuels investor expectations that the Fed might start cutting interest rates.

The US government bond yield dipped slightly after the inflation data announcement, with the 10-year yield falling to 4.4% from 4.5% the previous week. Investors expect the Fed to keep rates unchanged at the June meeting, but anticipate rate cuts in September and December.

4:37 - Singapore market updates

STI Top performers:

• ST Engineering 
• CapitaLand Invest
• OCBC
• Hongkong Land
• CapitaLand Ascendas REIT

STI Worst performers:

• Wilmar
• Frasers Logistics & Commercial Trust
• Jardine Matheson
• City Developments
• Seatrium

The Singapore market rose 0.7% last week, with ST Engineering performing well. Stocks linked to the Chinese property sector, such as CapitaLand Invest and Hong Kong Land, also did well due to optimism around the Chinese market and expectations of supportive measures.

6:09 - SIA

• Singapore Airlines (SIA) reported a net profit of $2.7 billion for the full year, with a 7% revenue growth. 
• However, operating profit was down 19.5% in the second half of the year. 
• The company also saw a decline in passenger yields and cargo segment yields in the fourth quarter.
• While SIA's dividend yield of 7.1% is attractive, it is offset by weaker operating profit and concerns around profit sustainability going into next year. 
• The company's share price rebounded in May but fell slightly after the results announcement. 

Read our analysis of SIA’s performance here.

MSCI Singapore Index Removal

• Seatrium, City Developments, Jardine C&C, Mapletree Logistics Trust, and Mapletree Pan Asia Commercial REIT will be removed from the MSCI Singapore Index from 1 June 2024. 
• As at 30 April 2024, there were 21 constituents in the MSCI Singapore Index. 
• With the removal of the five stocks, the number of constituents on this index will be reduced to 16.

Read our analysis of the MSCI Singapore Index removal here.

12:12 - Mapletree Logistics Trust

• Mapletree Logistics Trust's recent update showed a 2.5% decline in DPU, despite a slight increase in net property income due to a larger unit base. 
• However, occupancy remains healthy at 95.9%, with a strong Singapore portfolio occupancy rate of 96.7%. 
• The dividend yield is currently 6.6%, above the REIT's historical average.

Learn more about Mapletree Logistics Trust here.

14:52 - Mapletree Pain-Asia Commercial Trust

• In the quarter ending March, Maple Tree Pan-Asia Commercial Trust saw a 1.8% increase in distribution per unit compared to the previous year. This was driven by growth in gross revenue and net property income, which offset the rise in net finance costs.
• The trust's Singapore properties, particularly retail ones like VivoCity, maintained a high occupancy rate of 100%. 
• However, overseas properties, such as those in China, experienced a decline in occupancy rates. 
• Maple Tree Pan-Asia Commercial Trust currently offers a dividend yield of 7.2%, above its historical average. 

Learn more about Mapletree Pain-Asia Commercial Trust here.

17:11 - Technical Analysis

Straits Times Index 

• Volatility is decreasing, indicated by converging Bollinger Bands
• Next support level is around 3,280-3,250 points (20-day and 50-day moving averages)
• Resistance levels are at 3,324 points (year-to-date high) and 3,330 points (upper Bollinger Band)
• MACD and RSI indicators suggest a range-bound market in the near term

Dow Jones Index

• New all-time high above 40,000 points
• Might be worthwhile being cautious due to macroeconomic factors (unemployment, inflation)
• Next support level is around 38,700-38,600 points (20-day and 50-day moving averages)
• MACD and RSI indicators suggest a possible pullback

S&P 500 Index

• New all-time high at 5,303 points
• Next support level is around 5,140-5,130 points (20-day and 50-day moving averages)
• MACD and RSI indicators suggest a possible pullback

Nasdaq Composite Index

• New all-time high at 16,685 points
• Next support level is around 16,060 points (20-day moving average)
• MACD indicator suggests a possible pullback
• NVIDIA results on Wednesday may impact the index

What to look out for this week

• Wednesday, 22 May: Singapore Public Holiday, Nvidia earnings
• Thursday, 23 May: Singapore GDP data, Singtel earnings, Singapore 6-month T-bill auction

Get the full list of Singapore stocks, REITs and ETFs with upcoming dividend payments with our dividend calendar.

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