STI eyes 5,040 peak with oil prices driving markets: DBS

Higher prices support bank margins but weigh on REITs and transport.

Singapore’s stock market is expected to trade between 4,700 and 5,040 in the near term, on the back of sustained fund inflows and outperformance against regional peers.

A DBS Research Insights note said that the Straits Times Index (STI) has retained its ‘safe-haven’ status for now, with oil prices the key variable.

The resumption of flows through the Strait of Hormuz is seen as a key catalyst, it added.

Higher oil prices may support bank margins in the short term, but a sustained rise towards $193 (US$150) per barrel could trigger recession concerns and weigh on equities.

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