According to SGX, institutional investors sold nearly S$900 million worth of local stocks last week, with our three banks accounting for about 80% of the outflows.
After such a strong run this year, I think some profit-taking was probably overdue. The recent analyst downgrades certainly didn't help either. When stocks have already gone up so much, sometimes it doesn't take much to trigger a round of selling.
But I wouldn't be too quick to write off the banks. After the sharp correction, we may see some bargain hunting, although I suspect they could consolidate for a while. The upcoming November results will be worth watching.
What's more interesting is where some of the money went.
While the banks were being sold down, over S$110 million flowed into 93 small and mid-cap stocks, with tech names attracting nearly 70% of those inflows.
$AEM SGD(AWX.SI) was one of the biggest beneficiaries. The semiconductor outlook is encouraging, and earnings expectations are looking better. But here's the catch. With AEM having gained over 550% this year as of last Friday, I would be a little cautious about chasing it at current levels.
After all, a good company doesn't automatically mean a good buy at any price!
So perhaps this isn't simply a case of investors pulling money out of Singapore equities. Some may just be shifting their attention elsewhere.
And that's the interesting thing about the market. While everyone is watching the banks fall, opportunities may quietly be developing in other corners.
Of course, finding a good story is one thing. Finding it at a good price is another. Especially when some stocks have already run so far!
Thanks to Lianhe Zaobao Business Journalist, Tobby Siew (财经新闻记者 萧维旸), for the opportunity to share my thoughts on these market developments.
https://www.zaobao.com.sg/finance/singapore/story20261013-9830091
Reference: SGX report
#MarketInsights #Zaobao #Banks #AEM #SGTech #TradeSGX #POEMS #danccs
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