Blue-chip gains push Singapore market cap higher in June

Singapore

SINGAPORE'S stock market value bounced back in June, led by gains among blue-chips stocks.

Total market capitalisation of the Singapore Exchange's 706 counters on June 30 edged up 2.1 per cent to S$761.6 billion from S$746.1 billion as at end-May. The number of counters that gained outnumbered losers 340 to 194.

Mainboard-listed counters' total market value was 2 per cent higher at S$752.1 billion. Catalist stocks, on the other hand, rose 8.7 per cent in total market value to S$9.5 billion.

For much of the first week of June, Singapore shares rose on optimism of a quick global economic recovery with the easing of coronavirus lockdowns. The winning streak ended amid fresh concerns over a second wave of infections but fears were subdued by end-June on better economic data.

The Straits Times Index (STI) had rebounded 16 per cent as at June 30, from its closing low of 2,233.48 on March 23.

According to data compiled by The Business Times (BT) blue-chip stocks recorded stronger gains in June, with the STI constituents' total market capitalisation inching up 3.9 per cent to S$457.5 billion, compared to S$440.2 billion a month earlier.

This was led by the local lenders - DBS, OCBC and UOB - that were among the top 10 gainers for June.

DBS recorded the biggest gain among all Singapore stocks of S$3.4 billion from May. OCBC and UOB gained S$2.0 billion and S$1.2 billion respectively.

Head of research at Phillip Securities Research Paul Chew told BT: "Gainers were essentially the banks as a result of the relaxation of the lockdowns that relieved some of the stresses on the domestic economy."

Malaysian glove maker Top Glove emerged as the sole non-STI counter among the top 10 gainers. Its capitalisation gained S$953.7 million, as it continued to ride on investors picking up medical plays.

For its latest quarter ended May 31, the firm had attributed the most outstanding performance in its 29-year history to "unparalleled growth in sales volume, on the back of the global Covid-19 pandemic". It also expects growth to be sustained post-Covid-19 due to increased hygiene awareness and greater demand for gloves in both medical and non-medical fields.

Meanwhile, stocks within the consumer staples space also clocked gains. Wilmar International's market value increased by S$704.4 million from a month ago.

Analysts are bullish on the firm's likely listing of its subsidiary in China, saying that it is expected to gain strong interest among investors. DBS had on Wednesday maintained its "buy" call on Wilmar, raising its target price to S$4.60 from S$4.

"We believe that Wilmar should be able to withstand China's economic turbulence caused by the Covid-19 outbreak. Wilmar's strong presence in China's staple food market means that its well-diversified product lines are irreplaceable, even amid the current tough environment," said DBS.

Supermarket operator Dairy Farm International's market value climbed S$712.4 million from May as grocery sales remained robust amid the pandemic.

On the other hand, companies in sectors most severely impacted by the pandemic continue to suffer.

This includes Singapore Airlines, Genting Singapore and CapitaLand Mall Trust, which lost S$352.4 million, S$307.2 million and S$258.4 million in market value respectively from a month ago.

Phillip Securities' Mr Chew pointed out that another category of stocks that were hurt were companies undertaking capital-raising exercises.

This included Sembcorp Marine and Halcyon Agri Corporation losing S$532.2 million and S$327 million in market value respectively.