Singapore stocks rises amid trade tensions

[SINGAPORE] Singapore stocks closed higher on May 27, buoyed by the U.S. decision to extend its tariff negotiation deadline with the European Union to July 9.

On May 23, the Trump administration had threatened to slap a 50 per cent tariff on EU imports starting June 1, but reversed course with a delay announced on May 25. The extension is viewed as a temporary relief for global markets, which have been jittery over persistent U.S.-EU trade tensions. Analysts see this as a window for both parties to resume discussions and possibly broker a more favorable agreement. However, the uncertain outcome of negotiations continues to temper investor enthusiasm.

In Singapore, the Straits Times Index rose 0.5 per cent, gaining 20.49 points to finish at 3,896.09. The local market’s uptick is also credited to the strength and diversity of Singapore’s economy, particularly its finance, technology, and real estate sectors. These segments have demonstrated resilience amid global economic headwinds, offering investors a relatively secure investment environment.

Market breadth was positive, with 249 advancers outpacing 180 decliners. A total of 1.12 billion securities valued at $958.01 million changed hands.

ST Engineering led gains on the benchmark index, climbing 2.5 per cent, or 19 cents, to close at $7.75. The company’s performance underscores the growing relevance of the technology and defence sectors, with ST Engineering’s focus on innovation and strategic alliances enabling it to tap into emerging areas such as cybersecurity and advanced manufacturing.

Conversely, Jardine Matheson was the top decliner, slipping 1.5 per cent, or 68 US cents, to end at US$45.21. CapitaLand Integrated Commercial Trust emerged as the most actively traded counter by volume, with 32.1 million units worth $66.6 million exchanged. It added 1 per cent, or two cents, to close at $2.08.

Across the region, markets ended on a positive note. Australia’s ASX 200 advanced 0.6 per cent, Japan’s Nikkei 225 rose 0.5 per cent, and Hong Kong’s Hang Seng Index edged up 0.4 per cent. Regional bourses have been closely monitoring the progress of trade talks, as any developments could have widespread implications for Asian economies. The modest gains reflect cautious optimism among investors hoping for a more predictable global trade landscape.

Aaron Chwee, head of wealth advisory at OCBC Bank, noted that the delay in tariff implementation has given a short-term lift to futures markets. However, he added that underlying concerns about trade relations remain a drag on sentiment.

Despite expected near-term volatility, Chwee said the outlook over the next 12 months “appears more constructive.” OCBC continues to maintain an “overweight” stance on Asian equities (excluding Japan), with a particular focus on the Singapore, Philippine, China, and Hong Kong markets.