Singapore REIT Fundamental Analysis Comparison Table – 2 January 2017

FTSE ST Real Estate Investment Trusts (FTSE ST REIT Index) decreases from 722.05 to 709.49 (-1.74%) compare to last post on Singapore REIT Fundamental Comparison Table on Dec 5, 2016. The index is trading below the 200D SMA.  Take note that the 200D SMA is no longer sloping up and is currently flat. If the index continues to trade below 200D SMA and the 200D starts to slope down, the Singapore REIT sector will reverse to a confirmed down trend. FTSE ST Real Estate Investment Trust Index is currently forming a Falling Wedge and is finding a short term support at about 700. Keep an eye to see whether this support holds in the next few months. SGX S-REIT (REIT.SI) Index decreases from 1111.15 to 1092.36 (-1.69%).


  • Price/NAV decreases from  0.951 to 0.942 (Singapore Overall REIT sector is under value now) after recent sell off. Current Price/NAV is getting closer to Feb 2015 low of 0.91. See Singapore REIT Table Feb-2016 here.
  • Distribution Yield increases from 7.22% to 7.32% (take note that this is lagging number). More than half of Singapore REITs (22 out of 39) have Distribution Yield > 7%. High yield REITs mainly from Hospitality Trust and small cap Industrial REIT. However, some of the big cap & fundamentally strong REITs become attractive again. How to spot those Fundamentally strong REIT with attractive yield to build up a Passive Income Portfolio?
  • Gearing Ratio increases from 35.09% to 35.11%.  24 out of 39 have Gearing Ratio more than 35%.
  • Most overvalue is Ascendas iTrust (Price/NAV = 1.562), followed by Parkway Life (Price/NAV = 1.439) and Keppel DC REIT (Price/NAV = 1.332)
  • Most undervalue (base on NAV) is Sabana REIT (Price/NAV = 0.481), followed by Far East HTrust (Price/NAV = 0.645) and Fortune REIT (Price/NAV = 0.674).
  • Highest Distribution Yield is Sabana REIT (12.55%), followed by Viva Industrial Trust (9.54%) and Lippo Malls Indonesia Retail Trust (9.30%).
  • Highest Gearing Ratio is Croesus Retail Trust (45.3%), iREIT Global (42.5%), Sabana REIT (41.5%), Cache Logistic Trust (41.2%), Ascott REIT (41.0%) and OUE Commercial REIT (40.8%)



Disclaimer: The above table is best used for “screening and shortlisting only”. It is NOT for investing (Buy / Sell) decision. To learn how to use the table and make investing decision, Sign up next REIT Investing Seminar here to learn how to choose a fundamentally strong REIT for long term investing for passive income generation.


  • Singapore Interest Rate decreases from 0.07% to 0.06%.
  • Take note of the past historical interest rate and how high the rate can go. This is an important factor to keep a close eye for Singapore REIT investing because REIT leverages on debt to generate DPU. Current Singapore interest rate is abnormally low and will not stay low forever.

singapore-interest-rate-jan2-2017 singapore-sibor-jan2-2017

  • 1 month increases from 0.67155% to 0.71638%
  • 3 month increases from  0.92538% to 0.96271%
  • 6 month increases from  1.21289% to 1.25050%
  • 12 month increases from 1.39817% to 1.43317%


Manufacturing PMI in Singapore increased to 50.20 in November from 50 in October of 2016. Manufacturing PMI in Singapore averaged 50.03 from 2012 until 2016, reaching an all time high of 51.90 in October of 2014 and a record low of 48.30 in October of 2012.


The Singaporean economy contracted a seasonally-adjusted annualized 2 percent on quarter in the three months to September of 2016, compared to a 4.1 percent decline in preliminary estimates. Markets were expecting a 2.5 percent contraction. GDP Growth Rate in Singapore averaged 6.82 percent from 1975 until 2016, reaching an all time high of 37.20 percent in the first quarter of 2010 and a record low of -13.50 percent in the fourth quarter of 2008.

Singapore REITs sector continued the selling off after US Fed rate hike. Technically FTSE ST REIT index is bearish and is on down trend. Another round of sell off is expected if the index breaks the 700 support level. Current valuation base on Price/NAV and Distribution yield become attractive again. As long as the index finds a good support at 700, there are good opportunities to pick up some fundamental strong REIT. Two questions may interest all the retail investors: WHEN is the right and safe time and WHAT REIT to pick? Check out the next Investing in Singapore REIT course here.

See my Singapore REIT 2017 Market Outlook here.

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Weekly Inter Market Analysis Dec 31-2016

See previous week Weekly Inter Market Analysis.

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Profit taking after SPY reached the all time high of 227.75 entering into 2017.  A healthy retracement is needed for SPY to move higher. Take note that the bullish between Nov to April seasonal cycle is going to start.

  • Immediate resistance – 227.75
  • Immediate support: about 219-220. (have to turn to support for SPY to move higher)
  • Resistance turned support zone: 211-213.
  • 200D SMA support (trending up): about 213.5




VIX continues to stay within the complacent zone at 14.0. No fear entering into 2017.



Sector Performance (SPDR Sector ETF)

  • Best Sectors: Real Estate (XLRE) +1.38%
  • Worst Sector: Financial (XLF)  -1.44%.



SUDX (S&P US Dollar Futures Index)

SUDX is currently facing resistance at about 138 and currently take a breather. The trend remains up for US Dollar.



FXE (Currency Shares Euro ETF)

FXE rebounded from the support at around 100.65 but is still trading within a down trend channel.  A Shooting Star candlestick is formed at the down trend channel resistance, a potential reversal in the coming weeks.



XLE (SPDR Energy Sector ETF)

XLE is currently retracing after hitting the recent high of 78.34. If XLE can find the support at 74.87 or 71.84, the bull has strength to move XLE higher.




USO (United States Oil Fund)

USO is currently facing the rectangle resistance zone. USO is still trading side way until a more convincing breakout.


TLT (iShares 20+ Years Treasury Bond ETF)

TLT is finding support at 117-118. Wait for the reversal and re-look at the bond market for bargain hunting. Some of the bonds can be very attractive after the recent sell off.



GLD (SPDR Gold Shares)

GLD is rebounding from the support at about 107 after the huge sell off. Will it rebound strongly from here entering into 2017?



Next Week Economic Calendar

Key events:

  • China Manufacturing PMI on Jan 1 (Sunday). Take note that China Manufacturing PMI has been in expansion mode for 3 months continuously.
  • US Manufacturing PMI on Jan 4 (Wednesday).
  • FOMC Meeting Minutes on Jan 5 (Wednesday)
  • Crude Oil Inventories on Jan 6 (Friday)
  • US Unemployment Rate on Jan 6 (Friday)


See upcoming Events here.


Weekly Market Summary.



Moving into 2017 after the Federal Reserve Rate Hike

Marcus TJ

Federal Reserve Rate Hike 

The Federal Reserve recently announced that they were hiking up the price of target federal funds by a quarter of a point from 0.5% to 0.75% in a move that had been long expected by financial analysts. This is only the second time that the Federal Reserve have increased rates in a decade, doing so last December, as they look to put rates in line with the strengthening U.S. economy.

Plans have also been drawn up by the Federal Open Market Committee and its chair Janet Yellen for three more price hikes in the next year and 2/3 more in 2018 as they look to arrive at a 3% rate. Let’s look at the details of the rise and the affect which it might have.


The Decision

The decision to raise interest rates has been made after a series of meetings with the committee, this is the 3rd time that Yellen has tabled the idea of a rate hike since the initial rate increase in December 2015. In the past, the decision has not been unanimous as many felt that the economy wasn’t improving at the necessary rate. Following the last meeting however, all agreed that the interest rate could be increased to match inflation levels.


Good News or Bad News

On the face of it, a rising rate could appear like bad news for many but it is in fact a strong sign of a growing economy. It is important to remember that interest levels were at around 5% in 2006 and during the 80s it was as high as 10%. In that sense 0.75% doesn’t look so bad.


How the Market Reacted

As this wasn’t an unexpected move, the market didn’t spiral out of control when the decision was announced, there were some loses felt, but nothing too hard to recover from. The Dow Jones index closed at around 120 points down with Caterpillar Inc. being the biggest decliner, Nasdaq fell by almost 0.5% and the S&P 500 fell 14.6 points as the energy sector lead the fall with an average 2% drop. This was nothing out of the ordinary for the markets as any decision from the Federal Reserve to change prices will see an uncertain reaction from the market.


What Global Impacts Will This Have?

When the U.S. makes such a decision its impact is always felt throughout the world and the decision to raise rates was no different. To begin with, higher rates have meant that debt repayments on American loans will be higher as they are given out in dollar denominations. Exports from Asia and the EU to the United States will also become cheaper and the rising dollar will likely cause a buzz on the forex markets. It is also likely that investment capital will move away from Asia as many utilize the higher interest rates on the Atlantic to push for better returns.

This is just the second of many price hikes that the U.S. will see in the coming years and whilst it does tell of a stronger U.S. economy, it will be interesting to see how the markets reacts in the coming weeks and months.