Weekly recap: Tapping on high interest rates before the year ends

By Beansprout • 02 Dec 2023 • 0 min read

The best fixed deposit rate and 6-month T-bill closing yield remain elevated in December.

what happened in the markets 2 dec 2023
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As we enter the last month of 2023, it’s still not too late to find ways to make your savings work harder.

This might be what prompted many investors to subscribe to the December issuance of the Singapore Savings Bonds (SSB), which saw a surge in demand with the attractive 10-year average return of 3.4%. 

The good news is that banks have largely maintained their fixed deposit rates in December 2023, with the best 12-month fixed deposit rate at 3.6% per annum

For investors eyeing the upcoming Singapore T-bill auction on 7 December, the closing yield on the 6-month T-bill has remained steady at 3.81% despite a further decline in US bond yields.

If you are looking to take additional steps to prevent your hard-earned savings from being lost to scammers, we compare the latest “money lock” accounts launched by DBS, UOB and OCBC to find out which is best for you.

Lastly, we share we can learn about life and investing from the wit and wisdom of Charlie Munger, as the world of investing lost one of its most brilliant minds this week.

weekly market update 2 dec 2023
Source: Bloomberg. Price as of market close on 1 December

🏦 WHAT'S NEXT FOR SINGAPORE BANKS?  

What happened? 

Singapore banks’ share price have fallen in the past month despite stellar headline earnings reported. 

What does this mean?

Investors appear to be concerned that net interest margins (NIMs) for DBS, UOB and OCBC have peaked with the Fed unlikely to be raising interest rates further. 

In addition, the management of Singapore banks are expecting NIMs to be flat or lower in the fourth quarter of 2023 and next year. 

Why should I care? 

The lacklustre performance of Singapore banks has been a drag to the Straits Times Index (STI), even as US market continues its rally. 

We analyse the prospects of DBS, UOB and OCBC after their recent third quarter results

💡 THE BIG IMPORTANT STORY

Will the T-bill yield bounce further in the auction on 7 December?

The closing yield on the 6-month Singapore T-bill has remained steady at 3.81%.

singapore t-bill auction 7 dec 2023

 

🚗 WHAT'S MOVING

  • Keppel Corp has agreed to acquire an initial 50% stake in Aermont Capital for a consideration of 356.9 million euros (S$521.8 million). Aermont will serve as Keppel’s European real estate platform and the acquisition is aimed at giving Keppel an immediate and strong foothold in Europe. 
  • Venture Corp announced that its board of directors has established a share buyback plan to purchase up to 10 million shares of the company. 
  • Manulife US REIT plans to raise funds through a mix of asset disposals and a sponsor-led loan to remedy its financial covenant breach. However, distributions will continue to be halted until December 2025.
  • Netlink Trust will revise down its prices for residential end-user connection and non-building address point (NBAP) connection services segments from 1 April 2024 after a review by IMDA.
  • Tesla’s long-awaited Cybertruck will be priced starting at US$60,990, over 50% more than what CEO Elon Musk had announced in 2019.

Source: Bloomberg, CNBC, Financial Times, Business Times, Edge Singapore

 

🤓 WHAT WE’RE LOOKING OUT FOR THIS WEEK

Source: Bloomberg, SGX 

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