Monthly Market Review

Economics

Lim Yuin, Chief Investment Strategist

Equities

Source: All data are sourced from Lion Global Investors and Bloomberg as at 28 April 2023 unless otherwise stated. *All figures stated in US Dollars.

Fixed Income

Source: All data are sourced from Lion Global Investors and Bloomberg as at 28 April 2023 unless otherwise stated. *All figures stated in US Dollars.

Macro & Markets

US Banks Earnings Beat

Against the recent banking turmoil backdrop, US biggest banks reported better-than-expected earnings, restoring confidence in the market. While there still exists lingering concerns of a wider systematic contagion, the strong prints signaled that funding stresses were largely concentrated and spillovers could be limited in the near-term.
That said, we see higher recession risks now in 2H2023 (versus our view at the start of 2023) and turn more cautious on US Equities.

China’s 1Q GDP Beat

China’s first quarter (1Q) Gross Domestic Product (GDP) print was a solid beat against market expectations at 4%, expanding 4.5% year-on-year (YoY).
However, market sentiment towards the sustainability of China’s recovery seems poor, particularly in light of softer Industrial Production (IP) and Fixed Asset Investment (FAI) numbers. We are of the view that markets are too bearish at the moment, and maintain our stance that its recovery will gain momentum through the rest of the year.

OPEC+ Surprise Oil Cuts

The OPEC+ (Organization of the Petroleum Exporting Countries) oil producers announced a surprise production quota cut which could signal their intention to keep brent oil prices above the US$75 to US$79 per barrel levels. Crude oil prices could spike higher on improving demand from China and keep global inflation higher for longer.

Movers & Shakers

Singapore raised Additional Buyers’ Stamp Duty (ABSD)

Effective 27th April 2023, foreign buyers purchasing residential property will see with an ABSD jump to 60% (from 30%). ABSD for Singaporeans buying their 2nd residential property has been raised to 20% (from 17%) while that of Permanent Residents (PR) to 25% (from 20%). While the quantum of the increase has come as a surprise to the market, the use of ABSD as a sector cooling measure is within our expectations.

The Bank of Japan (BoJ) held its first monetary policy meeting (MPM) on 28 April since Kazuo Ueda became governor

BoJ kept its ultra-loose monetary policies and made no changes to the yield curve control (YCC). That said, they removed a key part of its forward guidance on interest rates and announced plans for a comprehensive policy review.

All eyes on interest rate hike decision during May Federal Open Market Committee (FOMC)

While consensus is expecting a 25bps rate hike in May, debate is heating up on the trajectory of US interest rates headed into 2H2023. The majority of market participants are expecting 50bps cuts from July to rest of the year; we are watching keenly for Federal Reserve (Fed)’s commentary, job growth numbers and inflation print.

Recent Releases

Articles

Podcasts & Videos

Download Report

Disclaimer

This advertisement or publication has not been reviewed by the Monetary Authority of Singapore. It is for information only, and is not a recommendation, offer or solicitation for the purchase or sale of any capital markets products or investments and does not have regard to your specific investment objectives, financial situation, tax position or needs. Investments in the products mentioned herein are not obligations of, deposits in, guaranteed or insured by LGI or any of its affiliates and are subject to investment risks including the possible loss of the principal amount invested. You may wish to seek advice from a financial adviser before making a commitment to undertake any investment. In the event that you choose not to seek advice from a financial adviser, you should consider carefully whether the investment is suitable for you.

The information presented herein is for illustrative purposes only and should not be considered reflective of any particular security, strategy, or investment product. It represents a general assessment of the markets at a specific time and is not a guarantee of future performance results or market movement. Any opinions, projections or forward-looking statements expressed herein or information presented (which includes estimates, graphs, charts, formulae or devices) is subject to change or correction at any time without notice and is not to be relied on as advice. You are advised to conduct your own independent assessment and investigation of the relevance, accuracy, adequacy and reliability of any information contained herein and seek professional advice on them. No warranty is given and no liability is accepted for any loss arising directly or indirectly as a result of you acting on such information.

References to specific corporations/companies and/or their trademarks are not intended as recommendations to purchase or sell investments in such corporations/companies nor do they directly or indirectly express or imply any sponsorship, affiliation, certification, association, approval, connection or endorsement between any of these corporations/companies and LGI or the products and services of LGI. It should not be assumed that investment in the securities mentioned was or will be profitable.

This publication is not intended for use by any person other than the intended recipient and may not be reproduced, distributed or published without prior written consent of LGI. This publication may not be distributed in any jurisdiction or to any person where such distribution is prohibited (including Canada, Japan, the United States of America) or to US persons (as such term is defined in Regulation S under the US Securities Act of 1933).

©Lion Global Investors® Limited (UEN/ Registration No. 198601745D) is a Singapore incorporated company, and is not related to any asset or fund management entity that is domiciled in Europe or the United States.