SINGAPORE stocks rose on Friday (Nov 22) as the Republic’s economy exceeded expectations for third-quarter growth, prompting the government to revise the year-on-year growth for Q3 upwards to 5.4 per cent and adjust the full-year growth forecast for 2024 to around 3.5 per cent.
The upgrade in growth forecast for the full year takes into account better-than-expected performance in the first three quarters of the year with gross domestic product growth for the first nine months reaching 3.8 per cent, said the Ministry of Trade and Industry on Friday.
The benchmark Straits Times Index (STI) climbed 0.2 per cent or 6.8 points to close at 3,746.02. Across the broader market, gainers outnumbered losers 265 to 251, after 1.8 billion securities worth S$1 billion changed hands.
Singapore’s Q3 2024 GDP growth was driven primarily by manufacturing, wholesale trade and finance and insurance sectors, noted Selena Ling, chief economist and head of global markets research and strategy at OCBC.
However, she cautioned that the global trade and growth environment may turn even more challenging in 2025 with incoming US president Donald Trump threatening punitive trade tariffs against China and potentially a universal 10 to 20 per cent tariff against the rest of the world.
“Assuming that Trump’s policy shifts on tariffs, immigration and tax etc do materialise and are inflationary as anticipated, the Fed’s intended rate cut trajectory could be impacted, and this could in turn complicate the 2025 growth and inflation outlook for the global economy, including Singapore,” said Ling.
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UOB economist Jester Koh, meanwhile, expects growth momentum in Singapore’s trade-related sectors for the rest of 2024 and into early 2025 to continue. This will be driven by the ongoing recovery in the electronics cycle and supported by the front-loading of exports ahead of the proposed tariffs on US imports under Trump’s administration.
“For the rest of 2025, the outlook is somewhat cloudy given uncertainty surrounding the extent and timing of Trump’s touted tariffs, heightened geopolitical tensions, possible peak in the electronics cycle and pace of monetary easing by major central banks globally,” he added.
This uncertain global environment is already reflected in the performance of regional markets, which ended mixed. Hong Kong’s Hang Seng Index fell 1.9 per cent while Japan’s Nikkei 225 gained 0.7 per cent. South Korea’s Kospi Composite Index climbed 0.8 per cent and The Bursa Malaysia Kuala Lumpur Composite Index closed 0.1 per cent higher.
On the STI, Frasers Logistics & Commercial Trust was the biggest loser, down 2.7 per cent or S$0.03 to S$0.91.
Meanwhile, Genting Singapore was the biggest gainer, rising 2 per cent or S$0.02 to S$0.775.
