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Singapore stocks jump to two-year high as DBS, OCBC hit records

Bloomberg
Bloomberg • 1 min read
Singapore stocks jump to two-year high as DBS, OCBC hit records
Shares of DBS Group Holdings Ltd. climbed 2.3% and Oversea-Chinese Banking Corp. added 1.2%, with both extending record highs. Photo: Bloomberg
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Singapore stocks rose to the highest level in two years, helped by optimism over major banks’ dividend payouts and elevated Federal Reserve interest rates hopes.

“Clients are rotating to play the higher-for-longer interest rate theme. The banks are big beneficiaries,” said Tareck Horchani, head of prime brokerage dealing at Maybank Securities Pte. “Over the past two days, we have been actively purchasing shares for global funds and regional asset managers.”

Shares of DBS Group Holdings Ltd. climbed 2.3% and Oversea-Chinese Banking Corp. added 1.2%, with both extending record highs. United Overseas Bank U11 -

Ltd. rose 2% to its highest level in more than two years.

While higher interest rates help banks’ profitability, they can also translate into capital returns for shareholders “as the sector has [the] capacity to improve already very attractive dividend yields,” Horchani said.

The 12-month projected dividend yield for OCBC was 5.6% compared with about 4.3% for the MSCI Asia Pacific Financials gauge, according to data compiled by Bloomberg. Singapore banks are set to report results early next month.

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