Shares of Singapore’s biggest bank DBS reached S$45 for the first time on Wednesday (Jan 8).
The stock crossed that milestone to trade at S$45.14 by Wednesday afternoon, rising about 1.5 per cent. It then climbed further to close at S$45.44, up 2.11 per cent for the day. About 6.5 million shares changed hands.
The shares already hit record highs a few times late last year, on the back of strong earnings, with OCBC and UOB also rallying strongly. DBS was the second best-performing stock for the year, rising 43.9 per cent.
Analysts are bullish on Singapore’s three banks, and believe that they are set to post earnings growth in 2025, given higher-for-longer rates. They also view the bank sector as a beneficiary of global market uncertainties and rising geopolitical tensions.
Among the three lenders, DBS reported the strongest wealth-management income growth in its third-quarter results; it also posted the second-highest net profit, at 15 per cent year on year for the period, behind UOB’s 16.5 per cent.
The strong performance of the banks drove the Straits Times Index to a gain of nearly 17 per cent for 2024 – its best year since 2017.
RHB said in a note on Wednesday: “Singapore banks ended 2024 as the best performers, with the sector posting total returns of 44 per cent. This was driven by a combination of a higher-for-longer rate environment and strong earnings delivery.
“We see Singapore banks as the most defensive option – the best place to weather the US dollar strength and should FFR cuts pan out milder than expected,” it added, referring to the cuts in the US federal funds rate.
DBS is expected to report its full-year earnings in February.
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