Oil and gas counters remain vulnerable.
After a dismal showing in 2015, analysts at KGI Fraser remain bearish on Singapore’s equity market.
In particular, bombed-out oil and gas names will see little respite this year, as oil prices continue to hover near multi-year lows.
“However, we note that the oil & gas stock prices have already come down significantly and are beginning to converge with our TP, in-line with our bearish view,” KGI Fraser said.
Meanwhile, although banks are expected to benefit from interest rate hikes by the US Fed, KGI Fraser warns that a higher number of non-performing loans will likely keep growth in check.
“On the other hand, we are positive on REITs, with lower long-term interest rates and cheap valuations after steep decline in stock prices,” said KGI Fraser.
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