UOB KayHian: Which Singapore stocks to buy to benefit from volalitity

Singapore 50 dollar bill

UOB KayHian said it sees “selective opportunities” after the Straits Times Index retraced more than 6 percent from its year-to-date peak.

“Beyond the near-term market noise and trading gyrations, we remain constructive on the Singapore equity market,” UOB KayHian said in a note on Tuesday. “This is on the back of a pick-up in earnings growth that could see valuations stretch as current valuations are inexpensive. We urge investors to look beyond the noise.”

After looking at which stocks bounced significantly from intraday lows during the market turbulence on 6 February for insight on which shares investors will buy on weakness, UOB KayHian tipped three: Venture, SATS and CDL Hospitality Trusts.

It said those were key conviction picks and that any later market selloff would be an opportunity to accumulate on weakness.

After looking at stocks down significantly from 52-week highs, it said the bargain-list stocks it favoured included ComfortDelGro, Raffles Medical and SIA Engineering.

Within Singapore REITs, UOB KayHian said it favoured hospitality, office, industrial and retail, with its key picks including CDL Hospitality, CapitaCommercial Trust and Ascendas REIT.

The brokerage also raised its year-end target for the Straits Times Index to 3530 from 3460 after the recent earnings results. But it added that the target could “stretch” to 3730 if earnings surprise on the upside.

The STI was up 0.85 percent, or 28.83 points, at 3413.81 at 4:10 P.M. SGT.