Falling fixed deposit rates: Weekly recap and what to watch in the week ahead

By Beansprout • 22 Apr 2023 • 0 min read

Bond yields decline, Tesla disappoints & China's growth speeds up

Weekly Sprout 22 April 2023

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The cut-off yield on the 1-year Singapore T-bill fell to 3.58% in the latest auction this week, disappointing investors who were expecting to earn a higher return. 

Likewise, we observed a fall in fixed deposit interest rates, with the best fixed deposit interest rate now at 3.90%. 

If you’re looking to lock-in interest rates, do check out our guide to the best fixed deposit accounts. 

Singapore REITs go into full swing in reporting their first quarter updates, and we’re looking out for any changes in their key operational statistics.

 


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Weekly stock market update 22 April 2023
Source: Bloomberg. Price as of market close on 21 April 2023.

 

🚄 Full speed ahead

What happened? 

China’s economy started the year on a solid footing, growing at 4.5% in the first quarter from a year ago. The growth numbers handily beat market expectations for the economy to expand by just 4.0%.

What does this mean?

The stronger than expected economic growth data led economists to be more optimistic about China’s growth for the rest of the year.

Consumer spending was the bright spot as consumers gained confidence following China’s re-opening. Retail sales climbed 10.6% in March compared to the previous year, representing the fastest pace of growth since June 2021.

On the other hand, manufacturing activity and property investment were weaker than expected. 

Why should I care? 

China is seen by investors as a bright spot in the global economy following its re-opening, and the strong first quarter economic growth data appears to support this view.

However, the recovery appears to be benefiting some sectors more than the others.

Read our full analysis on what it means for your investments

 


🚗 WHAT'S MOVING

  • Tesla (TSLA) reported earnings that fell more than 20% from last year, as the company’s price cuts impacted profit margins. CEO Elon Musk said an uncertain economic environment could impact consumers’ willingness to buy cars. Chinese EV manufacturers NIO and Xpeng fell in tandem. Earlier, the company slashed prices on some of its Model Y and Model 3 electric vehicles in the US, marking the sixth time Tesla has lowered prices in the US this year.
  • Netflix (NFLX)’s revenue for the first quarter came in slightly below market expectations, as the company faced a delayed rollout of its crackdown on password sharing. 
  • Keppel Corp reported a revenue of S$2.25 billion in the first quarter of 2023, 9% higher compared to the previous year. Net profit for the quarter was “significantly higher” with the disposal gain of S$3.3 billion from the merger of Keppel Offshore & Marine and Sembcorp Marine.
  • Keppel DC REIT reported a distribution per unit (DPU) of 2.541 cents in the first quarter, a 3.0% increase compared to the previous year. The higher distributions were due to an increase in gross revenue from the acquisitions of data centres in China.
  • Keppel Infrastructure Trust plans to launch an equity funding exercise to raise gross proceeds of at least S$240 million. This comprises a private placement at a price of between S$0.464 and S$0.477 per placement unit, and a non-renounceable preferential offering at a price of between S$0.464 and S$0.467 per new unit.

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

 


💡 THE BIG IMPORTANT STORY

With Alibaba back in focus, what are the other opportunities in China?

We share how you can look beyond China's tech giants and get a slice of the fast-growing 'little giants'

UOBAM China PingAn ChiNext ETF


🤓 WHAT WE’RE LOOKING OUT FOR THIS WEEK

  • Tuesday, 25 April: iFast earnings
  • Wednesday, 26 April: Frasers Centrepoint Trust earnings, Singapore 6-month T-bill auction
  • Thursday, 27 April: UOB, Mapletree Industrial Trust, Mapletree Pan Asian Commercial Trust earnings
  • Friday, 28 April: CapitaLand Integrated Commercial Trust earnings

Source: Bloomberg, SGX 

 


🍭 THAT’S INTERESTING

Elon Musk’s net worth plummeted by US$12.6 billion in a tumultuous week for the billionaire, according to the Bloomberg Billionaires Index. This resulted from a 10% decline in Tesla’s share price after the company disappointed on its first-quarter results. On the same day, SpaceX’s experimental Starship rocket exploded minutes after liftoff. Elon Musk, the Chief Executive Officer of both companies, had earlier lost the throne of the richest person in the world to French luxury tycoon Bernard Arnault. 

Source: Bloomberg

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