Singapore's three banks and SGX drove 95.2% of the STI's rally this year, and DBS says that lopsided run is exactly why it is time to look past them.

The three local banks and the Singapore Exchange (SGX) contributed 95.2% of the Straits Times Index's (STI) 1,025-point rally year-to-date, whilst the remaining 26 component stocks added just 50 index points between them, according to DBS. The house said the concentration had become more pronounced since the US-Iran conflict began on 28 February, with the 26 stocks outside the banks and SGX collectively subtracting 184 index points over that period. It said it favoured index stocks underpinned by multi-year orderbooks. The house said Singapore real estate investment trusts (S-REITs) should benefit from a more stable interest rate outlook. “The MAS support measures introduced over the past one year are intended to revive the broader Singapore equity market, not just the financial stocks,” DBS said.