41页 英文

􀂄 Global conditions favour cyclicals but domestic conditions challenging
We expect incoming data to support a thesis for improving cyclical conditions.
Singapore’s small, open economy benefits from a pick up in global growth.
However, domestic conditions will pose a challenge. In 2013, the government will
publish 3 documents on population, land use and land transport policy. These
papers will indicate its long term policy plans as it restructures S’pore’s economy
to enable sustainable, “good quality” growth. We expect investors’ attention to be
refocused on housing, wages and land transport issues, discussion of which will
generally cast a downbeat note for stocks driven by domestic demand, in our view.

􀂄 Yield stocks to stay in favour
Amid these conditions, we expect stocks which offer decent dividend yields to
remain in favour. This theme worked well in 2012, and valuations are in many
cases no longer at bargain levels. However we believe yield compression is
justified. The combination of loose global monetary conditions, gradual
appreciation of the Singapore dollar, strong domestic household balance sheets,
healthy corporate balance sheets, high domestic inflation and low imported interest
rates will sustain interest in yield plays through this year in our view.

􀂄 Stock picks: CCT, CAPL, DBS, KEP, GENS, Noble, Suntec, Singtel, Tiger
Our top picks feature at least 2 of the following: Benefits from a global cyclical
recovery; has credible and generous dividends; can avoid the worst of tighter
domestic conditions; can tap demand growth via operations outside Singapore. Our
top picks are CapitaCommercial Trust, CapitaLand, DBS, Keppel Corp, Genting
Singapore, Noble, Suntec REIT, SingTel, Tiger Airways. FSSTI target is 3,430.