SINGAPORE (Dec 26): RHB Research is targeting 3,300 for the Straits Times Index (STI) by end-2019 and advises investors to remain defensive amid anticipated volatility in the year ahead – by focusing on buying stocks that offer stable earnings, strong balance sheets and sustainable dividends.

The research house’s caution comes despite inexpensive overall market valuations, in the research house’s view, with the STI trading at 12.7 times its one-year forward P/E at the -1SD band as at the close of Dec 13.

In a Dec 14 report, RHB says that while it expects “compelling valuations” and moderate appreciation of the SGD to bring long-term investors back into the market, it prefers defensive sectors as well as to focus on a bottom-up stock picking strategy for 2019.  

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