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Aberdeen Singapore Equity Fund

Objective

Aims to provide holders with medium to long-term capital growth from a portfolio of Singapore equities.

 

Manager's Monthly Report

December 2014

  • The local stockmarket was lifted in December by expectations of further monetary stimulus in China and Europe, while the US Federal Reserve pledged patience in hiking interest rates. Gains were pared by concerns over weaker data in China and possible emerging market contagion from a collapsing Russian rouble, amid the continued plunge in oil prices. An appreciating US dollar, on the back of investor risk aversion, led to losses in US dollar terms.
  • Fourth-quarter GDP growth disappointed at 1.5%, as the manufacturing sector shrank. Purchasing managers’ data was also weak. Headline inflation turned negative for the first time in five years, owing to lower car and housing costs.
  • In corporate news, Keppel Corp’s offshore and marine subsidiary won a contract to build one of the world’s largest land-drilling rigs valued at over US$100 million. This is an encouraging sign, as demand for the company’s rigs appears resilient even amid the challenging outlook for the sector.
  • Our real estate holdings made foreign acquisitions to tap into growth prospects overseas. CDL Hospitality Trusts made its foray into Japan by buying two Tokyo hotels for S$66 million. The purchases increase yields and enable the trust to capitalise on expected growth in tourist arrivals. CapitaLand’s subsidiary, Ascott, is buying a 185-unit serviced residence in Jakarta from its long-time Indonesian partner, Ciputra Property, for S$90 million. Keppel Corp’s listed subsidiary, Keppel Land, will acquire 75% of Array Real Estate, a Hong Kong retail management firm. Straits Trading made its first property acquisition in China, paying S$142 million for a retail mall in Chongqing.
  • Over the month, we took some profits from Singapore Airlines and Singapore Exchange given recent price rises, while we also topped up Keppel Corp and ST Engineering on price weakness.