Weekly recap: T-bill yield stays high while stocks rally

There was a piece of news that caught my eye this week.

In the Monetary Authority of Singapore (MAS) semi-annual macro-economic review, it warned that Singapore faces a “slower long run growth path”.

This made me think harder about whether I am making adequate plans to secure my retirement nest egg. 

If you are looking to make your savings work harder, there are still ample opportunities to do so as interest rates remain high.

For example, the cut-off yield for the recent 6-month T-bill auction has remained high at 3.74%.

Based on our latest projections, the interest rate on the next Singapore Savings Bond is also expected to rise further. 

Some banks have even started raising the interest rates on fixed deposit accounts!

If you are looking for opportunities to build your income portfolio, we recently held a webinar to share our thoughts on the REITs. You can watch a recording of the webinar here if you had missed it earlier.

Lastly, if you are looking for dividend opportunities in the Singapore market, we share 3 stocks which are paying out dividends in May.

I hope these resources will provide you with some ideas towards building your wealth! 

Gerald, Founder of Beansprout

📈 RELIEF RALLY

What happened? 

Global stocks bounced as geopolitical tensions in the Middle East eased.

In addition, upbeat earnings reported by selected companies helped to lift investor sentiments.

What does this mean?

Investors who were looking for the ongoing earnings season for good news found some reason to cheer Google and Tesla’s latest results announcement. 

Google’s parent Alphabet reported earnings that exceeded investor forecasts, and announced its first-ever dividend and a new $70 billion stock buyback. 

Tesla’s share price jumped after Elon Musk said that the company aims to start production of affordable new electric vehicle (EV) by early 2025. This more than offset a 55% year-on-year decline in net profit for the first quarter with slower demand for EVs and ongoing price cuts. 

However, Facebook parent’s Meta fell on worries about heavy spending on artificial intelligence.

Why should I care? 

Investors continue to tread carefully as interest rate expectations remain uncertain.

Despite higher interest rates, Singapore REITs largely bounced this week, with gains led by Digital Core REIT, CapitaLand Integrated Commercial Trust, and Mapletree Pan Asia Commercial Trust. 

Looking ahead, we will be awaiting the upcoming Federal Reserve meeting for clues on the US Central Bank’s interest rate direction.

🚗  MOVING THIS WEEK

• CapitaLand Ascendas REIT’s average rental rates rose by 16.9% for leases renewed in the first quarter of 2024, supported by healthy reversions across its US and Singapore assets. 
• CapitaLand Ascott Trust (CLAS)’s gross profit rose 15% year-on-year for the first quarter of 2024, due to contributions from new properties and a strong operating performance. CLAS saw higher revenue per available room (RevPAU) due to sustained demand for its lodging assets.
• Mapletree Industrial Trust reported a distribution per unit (DPU) of 3.36 cents for the 4QFY2024 ended 31 March, up 0.9% year-on-year. The higher distribution was supported by an increase in rental rate for its Singapore portfolio. 
• Mapletree Pan Asia Commercial Trust (MPACT)’s distribution per unit for the fourth quarter ended March grew 1.8% year-on-year to S$0.0229. This was driven by a strong Singapore performance and stable contributions from the Festival Walk in Hong Kong. 
• Frasers Centrepoint Trust (FCT) reported distribution per unit (DPU) of 6.022 cents for the first half of fiscal year 2024, 1.8% lower year-on-year, due to lower contributions from Changi City Point which was divested in October 2023 and Tampines 1 due to ongoing AEI works. 

Source: Bloomberg, CNBC, Business Times, Edge Singapore

💡 THE BIG IMPORTANT STORY

CapitaLand Ascendas REIT's share price declines. Is it a bargain?

CapitaLand Ascendas REIT's share price has fallen by more than 10% year-to-date. We look at its latest business update to find out if the REIT is now a bargain.

🤓 WHAT WE’RE LOOKING OUT FOR THIS WEEK

• Monday, 29 April: Mapletree Logistics Trust earnings
• Tuesday, 30 April: Parkway Life REIT earnings, Amazon earnings
• Wednesday, 1 May: Singapore Public Holiday, Federal Reserve Meeting
• Thursday, 2 May: DBS earnings, Apple earnings
• Friday, 3 May: US jobs data

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

Source: SGX, Bloomberg, Refinitiv

👩‍💻 WATCH OUR RECAP

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