UOB Kay Hian Private Limited
Date of Report: Monday, 25 August 2025
SINGAPORE MARKET OUTLOOK AUGUST 2025: Resilient Earnings, Defensive Picks, and S-REITs Rally as Monetary Easing Looms
Singapore Equities: Robust Performance Amid Uncertainties
The Singapore equity market has delivered a resilient performance in 1H25, with the Straits Times Index (FSSTI) climbing 22.12 points to 4,253.02. Market breadth remains positive, with 330 gainers outpacing 176 losers and a healthy trading value of S$1.28 billion. Notably, 75% of companies met or exceeded earnings expectations, underlining the market’s ability to weather tariff uncertainties and currency headwinds.
Key Market Highlights
- Singapore’s earnings season sees banks carrying the load, REITs upping rents.
- FSSTI target raised to 4,602, implying 8% upside for the remainder of 2025.
- Strong performance in consumer discretionary, energy, and communication sectors.
- Singapore’s defensive positioning attracts investment amid global trade tensions.
Major Indices and Market Performance
| Index |
Prev Close |
1M % |
YTD % |
| DJIA |
45,631.7 |
1.6 |
7.3 |
| S&P 500 |
6,466.9 |
1.2 |
10.0 |
| FTSE 100 |
9,321.4 |
2.2 |
14.1 |
| FSSTI |
4,253.0 |
(0.2) |
12.3 |
Top Trading Turnover and Movers
| Company |
Price (S\$) |
Change (%) |
5-day ADT (S\$m) |
| DBS Group Holdings |
50.81 |
0.4 |
166.7 |
| Singapore Telecommunications |
4.20 |
2.2 |
113.7 |
| Oversea-Chinese Banking Corp |
16.91 |
0.2 |
91.5 |
| United Overseas Bank |
35.40 |
0.9 |
81.6 |
| IFast Corp |
8.45 |
1.4 |
74.5 |
Sector Analysis: Banks, REITs, and Consumer Companies
Banks: Defensive Earnings and Attractive Yields
- Banks delivered stable earnings despite severe net interest margin compression. DBS posted +0.7% qoq, OCBC -6.6% qoq.
- NIM compression expected to moderate in 2H25.
- 2025 dividend yield for banks stands at 5.9%; OCBC is top pick with low P/B of 1.26x.
- Major capital management exercises include special dividends and share buybacks, totaling S\$8.0b for DBS, S\$2.5b for OCBC, and S\$2.8b for UOB.
REITs: Rental Reversions and Turnaround Momentum
- Positive rental reversions across REITs, ranging from single digits to triple digits (Digital Core REIT).
- Jackson Hole Symposium signals US monetary policy easing, boosting REITs outlook.
- Buy recommendations for blue-chip S-REITs: CapitaLand Ascendas REIT, CapitaLand Ascott Trust, Keppel DC REIT, Keppel REIT, Lendlease Global Commercial REIT.
Consumer Companies: Resilience and Expansion
- Sheng Siong continues store expansion and strong margins.
- Food Empire Holdings posts strong revenue growth.
- DFI Retail delivers robust performance and rewards shareholders with US\$0.48 interim dividend per share.
Singapore Strategy: STI Target Raised, Defensive Picks Favoured
- STI target upgraded to 4,602, reflecting an 8% upside.
- Forward PE multiple of 13.4x and P/B of 1.4x, still below historical averages.
- Yield of about 5.2% is 18% above Asian peers’ median.
Top Singapore Stock Picks for 2025
| Company |
Ticker |
Rec |
Price (S\$) |
Target Price (S\$) |
Upside (%) |
2025F PE (x) |
2025F Yield (%) |
2025F ROE (%) |
Mkt Cap (S\$m) |
P/B (x) |
| CapitaLandInvest |
CLI SP |
BUY |
2.71 |
3.49 |
28.8 |
20.4 |
4.4 |
5.0 |
13,516 |
1.1 |
| Mapletree Ind Tr |
MINT SP |
BUY |
2.01 |
3.04 |
51.2 |
15.3 |
6.6 |
7.2 |
5,734 |
1.2 |
| SingTel |
ST SP |
BUY |
4.20 |
4.58 |
9.0 |
23.4 |
4.3 |
10.3 |
69,353 |
2.8 |
| O C B C |
OCBC SP |
BUY |
16.91 |
20.15 |
19.2 |
10.6 |
5.8 |
11.9 |
75,976 |
1.3 |
Trader’s Corner: Technical Buy Ideas
Singapore Telecommunications (ST SP)
- Trading buy range: S\$4.16-4.17
- Last price: S\$4.20 | Target price: S\$4.57 | Protective stop: S\$4.06
- Price holds above resistance-turned-support after breakout.
- Conversion and base lines in bullish crossover, strong MACD.
- Upside target S\$4.57, stop-loss at S\$4.06. Fundamental BUY with target S\$4.58.
First Resources (FR SP)
- Trading buy range: S\$1.75-1.76
- Last price: S\$1.76 | Target price: S\$2.00 | Protective stop: S\$1.70
- Strong uptrend, price far above the cloud.
- Bullish crossover, bullish MACD.
- Upside target S\$2.00, stop-loss at S\$1.70. Fundamental BUY with target S\$1.85.
Sector Spotlight: S-REITs Set for Liquidity-Driven Rally
Jackson Hole Symposium and US Policy Easing
- Fed Chair Powell signals potential rate cuts as job creation slows.
- US added only 73,000 jobs in July, with sharp downward revisions for May and June.
- Inflation seen as transitory, with tariffs and supply chain changes having muted long-term impact.
- Effective US tariff rate up to 15.8%, but offset by sector exemptions and supply chain adjustments.
Key S-REIT Picks and Peer Comparison
| Name |
Ticker |
Rec |
Price |
Target |
Mkt Cap (US\$m) |
Yield (Fwd) |
Debt/Equity (%) |
P/NAV (x) |
| CapLand Ascendas |
CLAR SP |
BUY |
2.67 |
4.02 |
9,544 |
6.2 |
36.7 |
1.22 |
| Keppel DC REIT |
KDCREIT SP |
BUY |
2.31 |
2.69 |
4,046 |
4.6 |
44.2 |
1.46 |
| Keppel REIT |
KREIT SP |
BUY |
0.965 |
1.18 |
2,913 |
5.9 |
83.6 |
0.78 |
| Lendlease REIT |
LREIT SP |
BUY |
0.58 |
0.79 |
1,051 |
6.5 |
91.1 |
0.78 |
| CapLand Ascott |
CLAS SP |
BUY |
0.865 |
1.56 |
2,567 |
7.4 |
76.6 |
0.77 |
Company Outlooks and Peer Analysis
Large Cap Stocks
- CLI (CapitaLand Investment): BUY, S\$3.49 target, 28.8% upside.
- DFI Retail: BUY, US\$4.30 target, 37.8% upside.
- Genting SP: BUY, S\$0.89 target, 19.5% upside.
- Keppel: BUY, S\$10.46 target, 25.1% upside.
- OCBC: BUY, S\$20.15 target, 19.2% upside.
- Sea Ltd: BUY, US\$204.85 target, 14.1% upside.
- Sembcorp Industries: BUY, S\$7.90 target, 29.1% upside.
- SingTel: BUY, S\$4.58 target, 9.0% upside.
- Venture Corp: BUY, S\$14.35 target, 6.9% upside.
- YZJ ShipBldg SGD: BUY, S\$3.45 target, 20.2% upside.
Mid/Small Cap Picks
- CSE Global: BUY, S\$0.85 target, 22.3% upside.
- FEHT: BUY, S\$0.81 target, 39.7% upside.
- FEH (Food Empire): BUY, S\$2.73 target, 17.7% upside.
- MPM (MarcoPolo Marine): BUY, S\$0.076 target, 13.4% upside.
- SSG (Sheng Siong): BUY, S\$2.40 target, 16.5% upside.
- VALUE (Valuetronics): BUY, S\$0.83 target, 7.1% upside.
Sector Outlook: Defensive, Quality, and Yield
- Singapore dollar strength positions the market as a safe haven, attracting global investors.
- MAS Equity Market Development Programme provides tailwinds, with S\$1.1b allocated and S\$3.9b yet to be deployed.
- Top sectors for core EPS growth in 2025: Property (+30.4%), Plantation (+17.2%), Healthcare (+7.6%).
- Companies with high cash-to-market cap ratios and near 52-week highs are highlighted for further upside potential.
Risks and Catalysts
- Potential secondary tariffs on Russia could impact China and India.
- Limited new supply for logistics and retail segments in Singapore supports REITs.
- Preferential tariffs benefit pharmaceutical and semiconductor sectors.
Conclusion
Singapore’s equity market stands out for its defensive positioning, attractive dividend yields, and sector-specific growth stories amid global uncertainties. As the Fed pivots toward monetary easing and trade tensions show signs of abatement, Singapore’s banks, consumer companies, and S-REITs offer compelling opportunities for investors seeking quality, stability, and upside. The raised STI target and comprehensive list of top picks reflect both resilience and optimism for the rest of 2025.
Disclosures
This report was prepared by UOB Kay Hian Private Limited, a holder of a capital markets services licence and exempt financial adviser regulated by the Monetary Authority of Singapore. The report is for informational purposes and not a solicitation or advice to deal in securities. Analyst certifications and jurisdictional guidelines are included in the original report.
