OCBC Investment Research Private Limited
Date of Report: 22 August 2025
Global Markets Update: Key Earnings, Sector Insights, and Top Stock Picks for 2025

Market Pulse: Mixed Signals and Investor Sentiment Across Regions

United States: Economic Divergence and Fed Policy Uncertainty

U.S. stock markets retreated as investors digested conflicting economic signals. Jobless claims hit their highest level since June, indicating some cooling in the labor market. Yet, manufacturing activity and home sales remained robust, suggesting underlying strength. This divergence has led the market to anticipate a more hawkish stance from the Federal Reserve, with two-year Treasury yields rising as expectations for rate cuts dimmed.

• S&P 500: Down 0.40%, with notable declines in consumer staples and utilities.
• Nasdaq Composite: Fell 0.34% amid broadening tech stock selloff.
• Dow Jones: Dropped 0.34%, impacted by Walmart’s 4.5% slide after a rare profit miss attributed to tariffs raising costs.
• Inflation Outlook: Tariffs are starting to filter through to consumer prices, potentially pushing inflation above the Fed’s 2% target in coming months, reducing prospects for imminent rate cuts.

All eyes are now on Fed Chair Jerome Powell’s upcoming Jackson Hole speech, as analysts caution that market optimism for a September rate cut may be premature.

Europe: Resilience Amidst U.S. Tech Weakness

European equities traded near record highs, buoyed by hopes of a forthcoming Fed rate cut and resilience against U.S. tech stock declines.

• Stoxx Europe 600 Index: Flat, with gains in energy and banks offset by weakness in chemicals and media.
• Central Bank Watch: Investors remain cautious, closely tracking the European Central Bank for signs of imminent rate adjustments.

Asia: Tight Trading Ranges and Bond Yield Surges

Asian markets saw mixed performance, with the MSCI Asia Pacific Index falling 0.2% as gains in South Korea and Taiwan offset declines in Japan. Japanese government bond yields surged to multi-decade highs.

• Japan: 20-year bond yields reached 2.645%, a 26-year high; 10-year yields hit 1.61%, highest since 2008.
• China: CSI 300 rose 0.39%.
• Hong Kong: Hang Seng Index dipped 0.22%.

Singapore Market Overview

Company Analysis: Key Earnings and Strategic Moves

SATS Ltd (SATS SP): Resilient Growth and Strategic Expansion

SATS Ltd delivered a solid 1QFY26 performance, driven by profitable growth and effective strategic execution. Revenue rose 9.9% year-on-year to SGD1.5 billion, supported by robust volume growth in Gateway Services and Food Solutions.

• Gateway Services: Revenue jumped 11.2% YoY to SGD1.2b. Cargo processed surged 10.4% YoY to 2.4 million tonnes, outpacing the broader industry by increasing wallet share among existing customers and securing new accounts. Flights handled grew 2.6% YoY to 158,800.
• Food Solutions: Revenue climbed 5.6% YoY to SGD328.3m, even as gross meals produced declined 1.1% YoY to 26.1 million, mainly due to the consolidation of operations in China.
• Operating Profit: Up 10.9% YoY to SGD125.2m, with EBIT margin steady at 8.3%.
• Associates and JVs: Share slipped 7.1% YoY to SGD33m, impacted by the absence of a prior-year one-off gain. Excluding this, growth would have been positive.
• PATMI: Rose 9.1% YoY to SGD70.9m, aligning with full-year forecasts.
• Free Cash Flow: Temporarily affected by delayed customer payment, resolved in July; management expects this to be non-recurring.

Management remains confident of driving continued growth, particularly as the acquisition of WFS has diversified SATS’s geographic footprint, enabling flexible routing solutions for clients amid shifting trade flows. Risks include abrupt trade policy changes and weakened travel sentiment. The fair value estimate is maintained at SGD3.73.

ESG Update

• ESG rating upgraded in March 2024, driven by improved raw material sourcing and food safety certifications.
• Targets: Reduce Scope 1 and 2 emissions by 50% by 2030; carbon neutrality by 2040; net zero by 2050.
• Business ethics practices need improvement; limited community impact assessment noted.

Recommendation: BUY

CITIC Securities (6030 HK / 600030 CH): Riding Capital Market Momentum

CITIC Securities stands to benefit from strong capital market activity, with its asset management subsidiary, China Asset Management Co. (ChinaAMC), reporting a 6% YoY net profit increase in 1H25. CITIC Securities is forecast to deliver 18% PATMI growth for FY25, underpinned by broad-based topline gains across underwriting, brokerage, and asset management.

• ChinaAMC: Operating revenue up 16% YoY to CNY4.26b; net profit up 6% YoY to CNY1.12b; assets under management rose 32% to CNY2,851.2b.
• CITIC Securities: FY25 revenue forecasted to grow 17% to CNY74.6b; PATMI to rise 18% to CNY25.7b.
• Industry Tailwinds: Stock and ETF average daily turnover (ADT) reached CNY1.26t in 2Q25, up 52% YoY but down 15% QoQ. A-share IPO underwriting value soared 135% YoY and 27% QoQ to CNY21b in 2Q25. Refinancing underwriting and H-share IPO proceeds also increased YoY.
• CSRC Reforms: Ongoing regulatory initiatives to promote mutual funds and index investment are expected to benefit the brokerage sector.
• Fair Value Estimate: HKD31.15 (6030 HK); CNY42.40 (600030 CN), with ratings of HOLD (6030 HK) and BUY (600030 CN).

ESG Update

• Governance practices improved, now average among global peers.
• No flagged auditor independence issues; ethics training for all employees.
• Leading data security and staff management measures, including external IT audits and confidential grievance channels.
• Strong responsible investment initiatives, with ESG-focused due diligence and risk teams, though lacking sustainability engagement with investee companies.

Recommendation: HOLD (6030 HK) / BUY (600030 CH)

Latest Research Coverage: Top Picks and Sector Trends

Singapore STI Stocks: Market Capitalisation and Key Metrics

Conclusion: Navigating Shifting Risks and Opportunities

The current global market landscape is defined by mixed economic data, shifting monetary expectations, and sector-specific growth stories. Companies like SATS Ltd and CITIC Securities illustrate the value of strategic diversification and robust corporate governance. Investors should remain vigilant, monitoring economic indicators and central bank policies for evolving risks and opportunities.

This report provides a comprehensive snapshot of market conditions, company performance, and actionable insights for financial professionals and investors seeking to stay ahead in 2025.