World Cup lull could be investors’ chance to score SGX stocks: DBS 

[SINGAPORE] The upcoming Fifa World Cup could give investors a “tactical opportunity” to pick up Singapore stocks at attractive levels, said DBS analysts.

The brokerage said the global football tournament has historically coincided with weaker trading activity on the Singapore Exchange (SGX), creating opportunities to accumulate shares ahead of a rebound in market participation.

DBS named OCBC, Singtel and Venture among its top picks for investors looking to position ahead of a potential post-World Cup rebound in Singapore equities. 

The brokerage expects a similar pattern in the local market this year, with the World Cup set to run from Jun 11 to Jul 19.

“We foresee a quiet June due to the Fifa World Cup distraction, start of the US summer holiday, and the school holiday season in Singapore,” the analysts said in a report on Jun 3.

The lull presents a “good opportunity” for investors to gradually build positions ahead of a rebound in market activity following the tournament. The recovery will be supported by a pickup in post-World Cup trading participation, seasonal factors and the possible easing of Middle East tensions, they added.

DBS recommends accumulating blue-chip counters that could drive a July market rally, particularly dividend-paying stocks with ex-dividend dates in July and August, as well as companies with clear catalysts in the second half of 2026.

DBS also favours selected large-cap Singapore real estate investment trusts (S-Reits), including CapitaLand Integrated Commercial Trust, CapitaLand Ascendas Reit and Mapletree Logistics Trust.

Weaker trading during the World Cup season

DBS noted that trading activity on the Singapore Exchange (SGX) weakened during every of the five World Cup cycles observed by the brokerage between 2002 and 2018. The value of shares traded fell by between 5 per cent and 48 per cent during those tournaments. 

SEE ALSO

Sats, Venture are top STI performers in record-setting May

Singapore stocks end higher amid mixed regional showing; STI up 1%

In the years 2002, 2014 and 2018, the Straits Times Index (STI) ended lower over the course of the tournament. During these years, STI weakness was “generally concentrated” in the earlier-to-middle stages of the World Cup.

In the 2006, 2010 and 2014 World Cups, the Singapore market had a gradual pickup in momentum and participation from the Round of 16 onwards, particularly during the quarter finals and later stages of the tournament. 

Top stock picks

Against this backdrop, DBS highlighted several stocks for investors positioning ahead of a potential July rebound.

These include names that pay dividends or go ex-dividend in July and August such as OCBC, Singtel and Venture.

The brokerage also named counters with visible second-half catalysts such as City Developments and UOL.

It prefers large-cap S-Reits, including CapitaLand Integrated Commercial Trust, CapitaLand Ascendas Reit and Mapletree Logistics Trust.

It noted that while S-Reits have not been spared from higher-for-longer rates, much of the sector’s de-rating appears priced in. Lower domestic rates, alongside further interest cost savings with the Singapore overnight rate average remaining at year lows, continue to support attractive yield spreads. 

On investor positioning in technology, the brokerage continues to favour semiconductor names on a buy-on-pullback basis, with UMS preferred over AEM and Frencken.

Buy-on-pullback refers to the process of waiting for an asset’s price to temporarily drop during a larger upward trend, then buying at that lower dip. 

While near-term profit taking may emerge following strong year-to-date gains, DBS said, underlying drivers remain intact. This includes strong customer order momentum for UMS and multiple growth tailwinds for AEM across central processing units, fabless artificial intelligence, memory and outsourced semiconductor assembly and test. 

The analysts also identified InnoTek and MetaOptics as potential AI and semiconductor players. 

STI outlook

Despite expectations of softer trading activity in June, the brokerage maintained a bullish outlook on Singapore equities.

The brokerage maintained its year-end target of 5,250 for the STI, while keeping its base-case scenario that the benchmark will remain above 4,700 despite expected near-term volatility.

The STI has recently traded slightly above the 5,050 level – its highest level since the start of the US-Iran conflict – and DBS assigned a 50 per cent probability to its base-case outlook.

The brokerage’s outlook is underpinned by the Republic’s safe-haven appeal, resilient growth in sectors including AI-related exports, financial services, infocomm and construction, as well as market revival measures introduced by the Monetary Authority of Singapore.

The analysts also cited cautious optimism that the Strait of Hormuz could reopen by end-June.

However, DBS warned that the possibility of a prolonged stalemate in the US-Iran war could push Brent crude prices above US$110 per barrel, weighing on sentiment and challenging its base-case outlook.