His comments come after Senior Minister Lee Hsien Loong noted, at the Economic Society of Singapore’s annual dinner, that economic principles can be ignored, but economic laws cannot be repealed. Lee also warned that the US-led tariffs are likely to stay even after Trump leaves office.
“Once in place, they’re hard to roll back — and that’s reshaping global trade,” notes Wickramasinghe.
In response to The Edge Singapore’s queries, the analyst says his new target is driven by catalysts such as safe haven flows, domestic fiscal spending and policy reform, which “still has room to run”.
Among the sectors, the analyst believes Singapore banks have seen a peak in earnings, with not a lot of catalysts to move higher. That said, the downside with the banks’ bottom line is “protected” given their strong capital returns.
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Wickramasinghe is also positive on S-REITs as their “dividend spreads to the domestic risk-free rates are attractive and could be next in line for flow rotation”.
In his last Singapore strategy report with fellow analyst Toh Xuan Hao, Wickramasinghe raised his year-end STI target to 4,185 points, from 4,020 previously.
In that report dated June 25, the analysts outlined five structural themes that could drive earnings visibility. These are: domestic resilience, a positive spill-over from the China recovery, accelerating corporate capital returns, monetising synergies from the Johor-Singapore special economic zone (JS-SEZ) and deploying artificial intelligence (AI) at scale.
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At the time, Wickramasinghe and Toh named CapitaLand Integrated Commercial Trust (CICT), ComfortDelGro (CDG), CSE Global, Food Empire, ISOTeam, Sea Limited, Singapore Exchange (SGX), Sembcorp Industries, Singapore Telecommunications (Singtel) and Singapore Technologies Engineering (ST Engineering) as their top picks.
The Straits Times Index closed 29.18 points higher or 0.71% up at 4,161.43 points on July 17.
