Weekly Recap: T-bill yield falls while Nvidia lifts tech stocks

By Gerald Wong, CFA • 25 May 2024 • 0 min read

We also share our projections for the next SSB and analysis of the 30-year SGS bond.

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As a startup founder, I’ve been trying to find ways to be more resilient.

Hence I truly enjoyed reading national sprint queen Shanti Pereira’s column on ‘How I learnt to build resilience’.

She shared that her strategies are to “focus on the things within my control, embrace every single opportunity that I can get, appreciate the people around me and enjoy the process”.

By focusing on the things within her control, she has saved up enough to begin making investments that will help her build the future she wants.

Indeed, financial resilience is something that we shouldn’t neglect. And there are many ways that we can start building our financial resilience today.

One of the things is to make our savings work harder by earning a higher yield.

This week, we saw the cut-off yield of the 6-month T-bill come down to 3.65%. We find out what is driving the decline in the T-bill yield.

If you are eyeing the current SSB’s attractive 10-year average return of 3.33%, the good news is that the return for the next SSB is likely to stay close to 3.3% based on our latest projections.

Lastly, if you are looking for a bond with an even longer maturity, we find out if it might be worthwhile applying for the 30-year green SGS bond.

Happy growing!

Gerald, Founder of Beansprout

⏰ This week in markets

Stock market update — Source: Bloomberg. Price as of market close on 24 May 2024

🏋️‍♀️ Nvidia lifts tech stocks

What happened?

Nvidia reported fiscal first quarter earnings that beat market expectations. Its revenue reached $26.04 billion for the three months ending April, more than triple the same period last year.

This was driven by strong growth in its data centre segment, which saw sales reaching a record $22.6 billion.

What does this mean?

The strong earnings were seen by investors as a sign that demand for Nvidia’s artificial intelligence (AI) chips remains robust.

Nvidia remained confident of its prospects in the current quarter, projecting that its sales in fiscal second quarter would be above the market forecasts.

Why should I care?

Nvidia’s shares rose above $1,000 with a market cap gain of close to $220 billion following the results.

The improved sentiment towards AI stocks boosted the Nasdaq to a gain for the week.

Closer to home, the Straits Times Index (STI) closed flat after the latest data showed that Singapore’s economy grew by 2.7% year-on-year in the first quarter. The Ministry of Trade & Industry (MTI) also maintained Singapore’s GDP growth forecast for 2024 at 1% to 3%.

With the earnings season coming to an end, we share 4 Singapore blue chip stocks that reported higher profits.

🚗 MOVNG THIS WEEK

Singtel slipped into net loss of S$1.34 billion in the second half of fiscal year 2024, after impairment charge of S$3.1 billion on Optus. It proposed a final dividend of 6 cents and value realisation dividend of 3.8 cents, which will bring total dividend to 15 cents for the full year.

OUE is making an off-market equal access offer to acquire 10% of the total shares held by each shareholder. The offer price is S$1.25 per share in cash, 19% above the last closing price. The offer will open from 30 May to 27 Jun. The shares acquired will be cancelled.

DBS CEO Piyush Gupta sold more shares in the bank, generating proceeds of $13.8 million so far this month. He is left with 2.29 million shares worth about $81.75 million as at the end of 16 May.

Hongkong Land expects its underlying profit for the first half of 2024 to be ‘significantly lower’ than the previous financial year as it faces slower sales in China.

Source: Bloomberg, CNBC, Business Times, Edge Singapore