The year has seen some volatile movements in the stock market – we first saw a sell-down earlier part of this year due to some lackluster economic forecasts for global growth, followed by some influences from the US presidential campaigns and most recently, the Brexit.
Amidst this volatility, there are however, certain sectors that continue to be bright spots. What are those?
Usually, stock markets would categorize this under consumables but the fact is there’s a disparity between the outlook for the physical retail sector and e-commerce.
As reported in the media recently, malls have been quieter than usual, with some international brands exiting the Singapore market and some retail properties suffering from lack of tenants.
But the statistics for shopping online takes on an entirely different picture.
MasterCard’s 2015 online shopping survey showed that 48.5 percent of respondents in Singapore had made purchases through their mobile phones, which is an increase from 36.7 percent in 2014, according to a report of Straits Times.
Research firm Euromonitor International also said that online spending in Singapore grew from $1.08 billion in 2014 to $1.22 billion in 2015, which is an increase of close to 13% year-on-year.
So for investors interested in the rise of this sector, what can you invest in? Logistics for one, since online buying requires reliable sending and receiving of your purchases.
Others may want to look at companies that provide online payment methods, such as Paypal, and even longstanding card payment companies such as Visa and Mastercard Inc.
Both these stocks have an impressive upward trending 5-year chart.
The healthcare sector is rather resilient, especially since Singapore has an ageing population. Other than that, the country is also an attractive location for wealthy individuals to receive quality healthcare services.
For this sector, you can look out for stocks of healthcare operators, such as those which own hospitals like Raffles Medical Group, those that sell medical equipment and provide other health-care-related services, as well as drug producers.
Last but not least, you can also look out for REITs that focus on medical suites and facilities.
For the last 6 months, the SGX all Healthcare Index has been more or less stable despite the year’s volatile markets, and is one of the best-performing sectors on SGX.
3) Real Estate Investment Trusts (REITs)
Real estate investments have always been the darling of Singaporeans who have bought physical properties for decades.
With the first listing of REITs in Singapore in 2002, investors have been pouring into them as a convenient and accessible alternative to investing in the real estate market.
With high dividend yields and plenty of sectors to choose from, what’s not to like?
While cooling measures implemented in 2013 has definitely changed the outlook of REITs, data shows that investors are still putting their money into them.
In fact, in the last 6 months, the SGX S-REIT 20 Index has registered a 15.16% rise and has gained 23% in the last 5 years.