Singapore stocks with British portfolios end mixed on Friday

SINGAPORE stocks with exposure to the United Kingdom ended Friday (Jul 5) trading mixed.

The sterling pound strengthened slightly in the afternoon as the Labour Party swept to a resounding victory in the UK general election.

It was trading at S$1.7292, up 0.3 per cent, as at 9.59 pm.

Labour opposition unseated the Conservatives after 14 years with a landslide win, bagging 412 of the 650 seats in parliament. Outgoing prime minister Rishi Sunak has conceded the election and resigned.

In Singapore, real estate player City Developments Ltd (CDL), which has several UK properties, shed 0.4 per cent or S$0.02 to close at S$5.31.

In November last year, CDL acquired a 261-unit freehold project in Manchester for £75.6 million (S$125.7 million), which grew the group’s private rented sector portfolio to 1,648 operational and pipeline units across Leeds, Birmingham and Manchester.

Real estate developer Far East Orchard retreated 1 per cent or S$0.01 to S$1.

The group’s UK portfolio includes residential and purpose-built student accomodation.

Stapled security group CDL Hospitality Trust fared better, ending up 0.5 per cent or S$0.005 at S$0.955.

CDL Hospitality Trust has three hotels in the UK, including Hilton Cambridge City Centre, as well as The Castings, a 352-unit built-to-rent residential development.

Dormitory operator Centurion Corporation climbed 0.9 per cent or S$0.005 to S$0.59. The group runs private student accommodation in several cities in the UK – Bristol, Liverpool, Manchester, Newcastle and Nottingham.

Transport group ComfortDelGro , which has been expanding its footprint in the UK and Europe, declined 0.7 per cent or S$0.01 to S$1.34.

The group’s subsidiary Metroline in March clinched contracts worth £422 million to run buses in Manchester for five years. In February, another ComfortDelGro unit acquired UK-based transport specialist CMAC Group for £80.2 million.

Real-estate counters Ho Bee Land and CapitaLand Ascott Trust (Clas) ended flat.

Ho Bee Land’s counter stayed put at S$1.86. It has eight current UK projects, which include office and mixed-use developments.

Clas’ stapled securities closed unmoved at S$0.87. Its portfolio includes The Cavendish London, a 230-room hotel, as well as four Citadines apartment-hotels in the British capital.

Following the results, Swissquote Bank senior analyst Ipek Ozkardeskaya said that a Labour win is seen as “net positive” for both UK stocks and the pound.

“For stocks, the small and medium-sized stocks are expected to perform stronger than the FTSE 100 – which is more exposed to the global economic dynamics due to its high concentration of energy and mining stocks,” she said in a Friday note.

The FTSE 100 is an index of the top 100 blue-chip companies on the London Stock Exchange.

She noted that the FTSE 100 was up on Thursday by 0.9 per cent on “Labour victory vibes” and could “easily throw itself above the 50-day moving average before the weekly closing bell”.

Ben Ritchie, UK-based abrdn’s head of developed market equities, said that a “key priority” for the new government is to “make UK equities more attractive for both domestic and international investors”.

A way to do it is to scrap stamp duty on UK shares, which would make the country more competitive and attract “vitally needed inward investment”, he added.

“If the new government gets this right, businesses with significant exposure to the UK economy should be the likely winners – a shot in the arm in particular for companies in the FTSE 250 (for mid-cap companies) and FTSE SmallCap (indices),” he noted.