Singapore Stocks Near Record High as War Fuels Haven Status

rhsu7e5kvmurl}kfas8uoxwn_media_dl_1.png BloombergArticle content(Bloomberg) — Singaporean stocks are close to reclaiming their record high, with the country’s assets seen as a haven in the face of global volatility.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentEquities in the city-state have suffered the least in the region since the outbreak of the Iran war in late February sent global energy prices soaring. They’re on the cusp of being the first major Asian market to reclaim new highs since, aided by the Singapore dollar’s outperformance versus Southeast Asian peers.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThe US and Iran failed to reach a deal over the weekend, and President Donald Trump said the US will begin a full naval blockade of the strategic Strait of Hormuz, setting the stage for a renewed bout of global market turmoil.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentSingapore has a couple of factors in its favor. One, its Equity Market Development Programme, created last year, is expected to pour in billions of dollars to boost valuations and appeal to investors. Two, the composition of Singapore’s main stock index adds to the appeal, with high dividend-paying stocks such as DBS Group Holdings and Oversea-Chinese Banking Corp. making up more than 40% of the gauge.Article content“The relative strength of the Singapore dollar offers safe-haven status” to local equities, said Daniel Lau, a fund manager at Eastspring Investments in Singapore. The EQDP efforts offer valuation support amid the global uncertainty as well, he said.Article contentThe Straits Times Index is broadly unchanged from the beginning of the war, compared with a 4.9% drop in MSCI’s Asian gauge. Asian stocks are still nearly 5% away from erasing the losses from the conflict.Article contentArticle contentThat said, the city-state’s stock market has underperformed Asian stocks this week after a ceasefire announcement triggered a relief rally globally. The region’s rebound, led by technology stocks, has brought Taiwan’s stock market close to surpassing its previous record — and an end to the war might bolster gains for tech, putting Singapore at a relative disadvantage.Article contentStill, analysts bet that further strength in the currency could provide a platform for more gains as geopolitical uncertainties drive investors to chase diversification. The Singapore dollar may get a boost from a possible tightening by the Monetary Authority of Singapore at its meeting on Tuesday — likely via increasing the appreciation of the Singapore dollar against the basket of currencies of its main trading partners.Article content“Singapore is at the intersection between safe-haven flows – especially amid Middle East uncertainties – and domestic liquidity drivers brought about by market reforms and a construction boom,” said Thilan Wickramasinghe, head of research at Maybank Securities. “This is supporting Singapore equities to buck the trend compared to global equities.”Article content(Adds details on failed talks in third paragraph)Article contentTrending GFL Said to Near Deal to Buy Secure Waste for Over $4.3 Billion PMN Business Posthaste: More Canadians desperate for tax refund to plug holes in their finances News How the global energy crisis is shaking Canada from coast to coast — and could leave a lasting legacy Oil & Gas Britain Faces Another Lost Year for Living Standards Due to Iran War PMN Business Oil Tankers U-Turn in Hormuz as US-Iran Talks Break Down PMN Business Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. 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