Top SG stocks to invest in amidst choppy global markets

Morgan Stanley kicked CapitaLand Investment Ltd (CLI) off its list.

Those eyeing to invest amidst global macro uncertainties should turn their attention to banks over property stocks, according to Morgan Stanley.

In a report, the analyst said banks look "especially well-positioned to weather cost inflation headwinds and provide sustained growth in earnings and dividends."

"We believe banks may be more viable alternatives to stocks in the real estate and travel-related sectors as a shelter against high inflation," the analyst added.

Morgan Stanley, however, warned that travel-related stocks are still trading below pre-COVID levels and so are their earnings expected two years out.

Given that banks would also be "positively levered to the reopening theme," the analyst has also replaced property stock CapitaLand Investment Ltd (CLI) in their focus list companies with DBS.

With CLI's removal, Morgan Stanley's top picks now consist of DBS, UOB, Sea Limited, Keppel Corp, and Sembcorp Industries.

Apart from banks, the analyst said energy sticks will also likely outperform the property sector.

"As elevated energy prices persist, energy/utilities stocks like Sembcorp Industries will likely continue to benefit in the near term," Morgan Stanley said.

On  tech stocks globally, Morgan Stanley said: "Current risk-off sentiment may not be in their favour, but the longer-term secular growth story remains in place at valuations much cheaper than before."