Singapore's high-yielding stocks shine in rattled equities market

Investors can seek refuge in the REIT sector.

The Straits Times Index (STI) boasts an estimated 12-month forward dividend yield of 4.3%, the second-highest amongst major Asian equity markets after Australia, according to data compiled by Bloomberg.

Also read: Singapore doubles its weight on the Global Dividend Yield Index

Although the benchmark STI has dropped by almost 8% from a recent high on 25 July, some investors say that Singapore is still a bright spot in a global equity market marred by trade tensions and slowing economic growth, because of the steady dividends paid out by much of the country’s benchmark gauge, which is filled with banks, telecommunication companies and real estate investment trusts.

DBS Group Holdings Chief Investment Officer Hou Wey Fook recommends an overweight on Singapore stocks, especially REITs in the retail and industrial sector. He cites positive rental revision rates and growth in their distributions per unit, and notes that companies with a fixed dividend policy should offer more solace to investors.

An index of Singapore-listed REITs has surged 17% this year and has an estimated 12-month forward dividend yield of 5.3%, data compiled by Bloomberg show.

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