OCBC Investment Research
Date of Report: 26 August 2025
Global Markets in Focus: Detailed Equity Insights and Singapore Stock Analysis for August 2025

Market Pulse: Mixed Sentiment Across Global Equity Markets

Global equity markets began the week with caution as investors eyed upcoming U.S. inflation and labor market data that could influence Federal Reserve policy direction. Jerome Powell’s recent Jackson Hole comments focused on labor market risks, leading to a pullback in U.S. equities ahead of the critical Personal Consumption Expenditures (PCE) Price Index release and nonfarm payrolls data. The S&P 500 fell 0.43%, the Nasdaq declined by 0.22%, and the Dow Jones lost 349 points (0.77%), with nine out of eleven sectors closing lower. Consumer staples and healthcare led the declines, despite Nvidia’s 1% gain ahead of a closely watched earnings report.

In Europe, the Stoxx Europe 600 Index slipped 0.44%. French equities and bonds sold off following Prime Minister Francois Bayrou’s announcement of a confidence vote to resolve fiscal policy impasses. Wind energy stocks lagged after Orsted A/S halted a U.S. project.

Asia was notably brighter, with the MSCI Asia Pacific Index rising up to 1.1%, fueled by Chinese chip stocks and optimism that the Fed may lower rates next month. Taiwan, South Korea, and Hong Kong led regional gains, while Chinese property and technology shares rallied on new liquidity measures and Shanghai’s easing of home-buying rules.

Singapore Market Statistics and World Index Review

Trading volume surged 32.1% to 1,812.4 million shares, while turnover rose 44.3% to SGD1,830.9 million. The Straits Times Index ranged between 3,372.4 and 4,282.8 over the past 52 weeks, with 391 gainers and 187 losers on the day. In the world indices, the Hang Seng Index led with a 1.9% gain, while the S&P 500 and Dow Jones were negative.

FX & Commodities Overview

Equity Research Spotlight: Hong Leong Asia Ltd (HLA SP)

Powering the Cities of the Future

Hong Leong Asia Ltd (HLA SP) stands out with robust growth drivers in both its Powertrain Solutions and Building Materials segments. The company’s 1H25 revenue soared 25.7% year-on-year to SGD2.8 billion, primarily propelled by Powertrain Solutions, which grew 30.8% YoY to SGD2.5 billion. Export demand and a shift toward new energy powertrains and gensets helped offset softness in China’s domestic market.

Building Materials faced a 2.5% YoY revenue decline due to lower ready-mix concrete volumes linked to delays in capacity replacement from plant closures. However, the ongoing construction upcycle and government infrastructure programs in Singapore and Malaysia underpin a positive outlook, with disruptions expected to resolve by year-end and volumes to recover in FY26.

Strategic Growth Drivers and Financial Performance

• Powertrain division volume rose 30% YoY to 250,396 units, with broad-based strength and strong export performance.
• AI proliferation is driving demand for DC generator engines.
• Investments in emission-reducing engine designs and new energy powertrains position HLA for regulatory tailwinds in China and global export growth.
• 1H25 PATMI climbed 13.1% YoY to SGD56 million, with an interim dividend of 2 Singapore cents per share versus 1 cent in 1H24.

Valuation and ESG Highlights

• Initiated with a BUY rating and fair value estimate of SGD3.10, based on DCF methodology.
• HLA maintains a strong balance sheet and net cash position, with potential for increased dividend payouts or synergistic acquisitions.
• ESG: Achieved 27% reduction in Scope 1 and 2 CO2 emissions intensity over FY24 (vs 2016 baseline). Expanded reporting scope in China covers key subsidiaries. Powertrain Solutions portfolio now includes hydrogen, ammonia-diesel, and methanol engines. Building Materials segment is developing low-carbon concrete products.
• Employee training averaged 51 hours per employee in FY24. Gender diversity remains a challenge (85.4% male workforce), especially in senior roles. Annual training on Code of Business Conduct and Ethics is in place, with ongoing efforts to improve supplier responsibility and operational safety.

Latest OCBC Investment Research Reports: Key Company Insights

Singapore Stocks: Market Capitalisation, Ratios, and Recommendations

The following table highlights the top Singapore stocks by market capitalisation, including key valuation metrics and analyst recommendations:

Other Notable Company Reports and Observations

• Singapore Post (SPOST SP): In a transition period, rated HOLD at SGD 0.495.
• CITIC Securities (6030 HK / 600030 CN): Benefiting from capital market activity; rated HOLD/BUY at HKD 31.15/CNY 42.40.
• SATS Ltd (SATS SP): Resilient performance, rated BUY at SGD 3.73.
• Jiangxi Copper Co Ltd (358 HK / 600362 CH): Smelting benefits from industry trends, rated BUY.
• China Aviation Oil (CAO SP): Growth prospects, rated BUY at SGD 1.50.
• Golden Agri-Resources (GGR SP): Cautious outlook for 2H25, rated HOLD at SGD 0.27.
• ST Engineering Ltd (STE SP): Strong order book momentum, rated HOLD at SGD 8.90.
• ComfortDelGro (CD SP): Stable outlook, rated BUY at SGD 1.75.
• Nanofilm Technologies (NANO SP): Returning to profitability, rated HOLD at SGD 0.72.
• UOL Group Ltd (UOL SP): Disciplined growth, rated BUY at SGD 8.65.
• Wilmar International (WIL SP): Mixed outlook, China remains supportive, rated BUY at SGD 3.54.
• CapitaLand Investment (CLI SP): Ongoing growth strategies, rated BUY at SGD 3.69.
• Stoneweg Europe Stapled Trust (SERT SP): Early signs of recovery, rated BUY at EUR 1.82.
• City Developments Ltd (CIT SP): Potential for higher dividends, rated HOLD at SGD 6.87.
• Bumitama Agri Ltd (BAL SP): Positive harvest expectations, rated BUY at SGD 1.05.
• Sembcorp Industries (SCI SP): Renewables strength offsets GRS weakness, rated BUY at SGD 8.02.
• Genting Singapore (GENS SP): Not yet at full potential, rated BUY at SGD 0.96.
• Singapore Exchange (SGX SP): Stable results and dividend growth, rated HOLD at SGD 16.15.
• United Overseas Bank (UOB SP): Share buyback provides price support, rated HOLD at SGD 38.20.

Conclusion: Key Takeaways for Investors

• Global markets continue to be driven by macro uncertainty, especially regarding U.S. inflation and labor data.
• Singapore’s equity market saw healthy volume and turnover, with REITs and real estate sectors outperforming.
• Hong Leong Asia Ltd is highlighted as a standout, combining growth in powertrain solutions and building materials with ESG leadership and strong financials.
• Analyst recommendations provide a robust view across Singapore’s largest companies, aiding investment decision-making in a volatile global landscape.

This comprehensive market review and company analysis offers investors, analysts, and market watchers a detailed snapshot of the latest trends, sector performance, and individual equity opportunities in Asia and beyond.