US election outcomes could shape Singapore equities through 2025

A Republican Party red sweep would be negative for some REITs, said DBS.

The outcome of the US elections will likely shape the performance of Singapore equities in the months ahead and potentially into 2025, experts from DBS said.

Should there be a Republican Party red sweep will be negative for real estate investment trusts (REITs) and stocks with Chinese exposure, warned DBS.

Such an outcome, however, will bode well for SATS and ST Engineering due to US reshoring efforts, the SGX and iFAST as they benefit from heightened market volatility, ComfortDelGro and Singapore Airlines since they are supported by capped oil prices, and Sheng Siong given its resilient domestic exposure.

A Kamala Harris presidency, meanwhile, would be positive for regional markets due to a more stable global trade environment and policy continuity, said DBS.

Frasers Centrepoint Trust (FCT), CapitaLand Ascendas REIT (CLAR), Mapletree Industrial Trust (MINT), and other beneficiaries of rate cuts are poised to benefit from a more favourable inflation outlook.

Regardless of who wins the election, DBS said Venture Corp and Frencken could benefit from technology supply chain diversification into ASEAN, whilst Seatrium might find support from a focus on clean energy or oil and gas by the next president.

Meanwhile, DBS said that a calm outcome from the US elections and lower interest rates could help the Straits Times Index (STI) reach its year-end target of 3750.

However, if Republicans win big and interest rates look set to rise, the market could become more volatile, with support levels at 3480 or even down to 3340.