OCBC Investment Research
30 July 2025

Global Market Pulse: Key Equity Insights and Company Analysis for Investors

Market Overview: US, Europe, and Asia in Focus

Global equities saw a cautious tone as major indices in the United States retreated, breaking a multi-day rally. The S&P 500 fell 0.3%, the Nasdaq 100 slipped 0.2%, the Dow Jones declined 0.5%, and the Russell 2000 dropped 0.6%. After recent optimism around trade agreements, investor sentiment turned wary ahead of critical economic data and corporate earnings updates.

• US job openings declined in June after a two-month rise, hinting at milder labor demand but continued employment stability.
• Consumer confidence increased in July, showing Americans’ growing optimism about the economy.
• The Federal Reserve began a two-day policy meeting, with expectations for steady rates. Investors are watching for guidance on future rate moves.
• Tech earnings are at the forefront, with Microsoft and Meta reporting, followed by Apple and Amazon. Their results are pivotal for sustaining the current rally.
• Starbucks shares jumped 3.7% after surpassing revenue and sales forecasts, notably in China and North America.

In Europe, the Stoxx Europe 600 Index rose 0.3%. Gains were led by banks and telecoms, while healthcare lagged due to Novo Nordisk’s drop. European equities are tracking for a monthly gain, with the index just 2% below its March peak. A new US-Europe trade deal eased tariff concerns, though some uncertainty lingers.

Asian equities marked a third straight session of losses, the longest streak in nearly two months. The MSCI Asia Pacific Index fell 0.5%, with significant drags from TSMC and Toyota. Notable declines were seen in Tokyo, Hong Kong, Taiwan, and Vietnam. Chinese childcare-related stocks gained on new government subsidies, and Singapore held monetary policy steady amid subdued inflation and ongoing tariff evaluations.

Key Market Statistics

Company Insights and Research Ideas

Mapletree Industrial Trust (MINT SP): Higher Rental Reversions but Lower DPU

• 1QFY26 DPU dipped 4.7% year-on-year to 3.27 Singapore cents, in line with expectations.
• Gross revenue and NPI increased marginally by 0.3% and 0.8% YoY, respectively, driven by new contributions from Osaka Data Centre and a Tokyo acquisition, partly offset by USD weakness.
• Total borrowing costs declined 6.4% YoY, but lower joint venture cash distribution and absence of one-off gains pressured overall DPU.
• Excluding one-offs, core DPU fell only 1.5% YoY (24.9% of the FY26 forecast).
• Singapore rental reversions were strong at +8.2%, outperforming mid-single digit guidance, though occupancy slipped to 91.4%.
• Occupancy in Singapore and the US fell slightly to 92.6% and 88.0%, respectively, while Japan remained at 100%.
• Aggregate leverage ratio held steady at 40.1%, with a reduction to ~37% expected after SGD516m in divestments in 3Q25.
• Average borrowing cost stable at 3.1%.
• FY26 and FY27 DPU forecasts lowered by 0.8% and 2.4% to reflect divestments and lower borrowing costs; fair value estimate revised from SGD2.46 to SGD2.39.
• ESG rating was upgraded in February 2024, driven by increased green building credentials, green leases, and solar installations. Board remains majority independent. BUY.

Capitaland Ascott Trust (CLAS SP): Positioning for Uncertainty

• 1H25 DPS edged down 1% YoY to 2.53 Singapore cents, matching expectations.
• 2Q25 RevPAU climbed 3% YoY to SGD159, led by a 3ppt increase in occupancy to 78%.
• RevPAU gains in Australia (+15%), UK (+4%), and US (+8%) offset declines in Japan (-23%, but +10% same-store). Singapore RevPAU dipped 3% YoY amid industry-wide softness.
• 1H25 revenue and gross profit rose 3% and 6% YoY, respectively, despite FX headwinds. DPS for the period was 41.5% of the annual forecast.
• Gearing improved to 39.6%, with cost of debt steady at 2.9% and 82% of debt on fixed rates.
• Every 100bps rise in rates would reduce DPS by 0.22 Singapore cents.
• Fair value estimate lifted to SGD1.02 (from SGD0.92), factoring in a lower risk-free rate and an ESG premium. BUY.
• ESG rating was upgraded in June 2025. CLAS leads global peers in governance and business ethics, with 43.4% of assets green-certified (vs. 33.4% industry average). First in governance among Singapore REITs and winner of the 2024 Singapore Corporate Sustainability Award.

Hong Kong Exchanges & Clearing Limited (388 HK): Well Positioned for Robust Growth

• Sequential momentum slowed in 2Q25, but YoY growth remains robust.
• 1Q25 set records for revenue (HKD6.9b, +32% YoY) and profit (core PATMI HKD3.6b, +47% YoY). Cash market ADT surged 144% YoY to HKD242.7b; Stock Connect Southbound ADT hit HKD109.9b (+255% YoY).
• Derivatives ADV rose 24% YoY in 1Q25 to 1.9m contracts; 1H25 ADV up 11% YoY, with some 2Q moderation.
• IPO activity strong: 27 new listings in 2Q25 (vs. 17 in 1Q25), totaling 44 in 1H25 (+47% YoY).
• Strategic focus remains on global connectivity, platform and product enhancements, and IPO attraction.
• EPS forecasted to grow 13.9% in FY25 and 8.9% in FY26; fair value estimate raised to HKD509.70 (from HKD440), applying a premium valuation due to structural tailwinds and ESG strength. BUY.
• ESG rating maintained: Board-level business ethics oversight, anti-corruption policies, and independent committees. Corporate governance is average among peers.

Singapore Airlines (SIA SP): Air India Losses Dampen Record Passenger Numbers

• 1QFY26 revenue up 1.5% YoY to SGD4.8b, driven by strong air travel demand. Passenger revenue rose 0.9% YoY to SGD3.9b; PLF improved 0.7ppt to 87.6% despite a 2.9% yield drop.
• Cargo revenue fell 1.9% as yields and load factor slipped.
• Group expenditure outpaced revenue, rising 3.2% YoY to SGD4.4b, mainly from non-fuel costs (+8.5% YoY) and inflation. Net fuel costs dropped 7.9% YoY.
• Operating profit declined 13.8% YoY to SGD405m. PATMI plunged 58.8% YoY to SGD186m, missing expectations, largely due to SGD121.6m share of losses from associates (notably Air India after the Vistara-Air India merger).
• Share price fell on the PATMI miss and may face further pressure post ex-dividend date (8 Aug). SIA’s passenger yields, though declining, remain resilient. The closure of Jetstar Asia could benefit Scoot in intra-Asia routes. Management expects Air India losses to narrow as its transformation progresses.
• Fair value revised up to SGD7.10 (from SGD6.80), based on a higher P/B target. HOLD.
• SIA is in a high-risk sector due to elevated carbon emissions. Its carbon intensity, while above industry average, has been improving thanks to fleet renewal and increased use of sustainable aviation fuel. SIA aims for net zero carbon emissions by 2050. Social metrics (compensation, customer satisfaction, on-time performance) are above peers; governance and data security are in line with industry standards.

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Market Capitalisation Snapshot: STI Stocks

Conclusion

Equity markets are entering a period of recalibration as earnings season intensifies and macroeconomic headwinds persist. Investors are encouraged to monitor corporate results closely, especially in sectors with robust fundamentals and strong ESG profiles. Stay tuned for further updates as market dynamics evolve.