Markets Insights

Investors focusing on Singapore flash Q4, full-year GDP data

Liquidity in regional markets expected to pick up; equities set to end the year positively

As 2019 comes to a close, market activity is likely to remain tepid with traders still making their return from their holiday break.

That said, liquidity in the region's markets will likely pick up towards the end of the week, with the new year ushered in on Wednesday. The market will watch out for key macroeconomic figures that are due at the start of the month.

While there has been a lack of fresh leads, market watchers have said the confirmation of a United States-China "phase one" trade deal and clarity on Brexit should continue to support equities to close out the year positively.

US stocks ended mixed last Friday as investors weighed a rally that has added more than US$5 trillion (S$6.8 trillion) to equities this year. The Dow Jones Industrial Average edged up 23.87 points or 0.08 per cent to a fresh high of 28,645.26, the S&P 500 gained 0.11 point to 3,240.02, while the Nasdaq Composite dropped 15.77 points or 0.17 per cent to 9,006.62.

In Singapore, the Straits Times Index was mostly flat before a late light bump to finish last Friday's session at 3,226.53, up 3.54 points or 0.1 per cent. On the week, the blue-chip index gained 14.14 points or 0.4 per cent.

Here, data releases for the week will be led by preliminary fourth-quarter and full-year gross domestic product (GDP) estimates on Thursday.

With industrial production in Singapore recording its sharpest fall since December 2015, by way of a 9.3 per cent year-on-year decline last month, UOB senior economist Alvin Liew noted that this could put some "downside risk to our full-year GDP growth outlook of 0.5 per cent in 2019".

Analysts said indicators of where Singapore's full-year GDP might end at could be revealed during Prime Minister Lee Hsien Loong's New Year message tomorrow.

Thursday sees the release of private home prices data for the fourth quarter of this year from the Urban Redevelopment Authority.

We believe in an investment strategy that reduces risk and enhances long-term social value creation. So both as investors and as businesses, we should have that as core to our strategy. MR EN LEE, HEAD OF SUSTAINABLE AND IMPACT INVESTMENTS FOR ASIA AT PRIVATE BANKING GROUP LGT

As part of the slew of early month Purchasing Managers' Index (PMI) releases, Singapore's official manufacturing PMI for this month is due on Friday.

"While November IP (industrial production) was disappointing, global recession risk has lowered of late, thanks to Asia's recovering tech sector. I will be looking at Singapore's PMI survey this week for signs of economic stabilisation," a trader told The Business Times.

In China, official manufacturing and services PMIs will be out tomorrow. Meanwhile, the Caixin manufacturing PMI, which focuses more on small and medium-sized firms in China, is due on Thursday.

Elsewhere in the Asia-Pacific, IHS Markit manufacturing PMI surveys for many of the region's economies, such as Malaysia, South Korea and Thailand, will also be released on the same day.

IHS Markit chief business economist Chris Williamson said Thursday's manufacturing PMI readings will provide "updated insight into whether world economic growth momentum has continued to build heading into 2020".

Among other economic data prints, South Korea will release November industrial production data today, which UOB's Mr Liew expects will increase 0.4 per cent year on year from a 2.5 per cent year-on-year decline recorded in October.