Dear readers, the Singapore Stocks benchmark indicator, the Straits Times Index (STI) is now hovering above the 3,000 mark in recent days. This is a somewhat noteworthy milestone for Singapore stocks as the 3,000 level is often seen as the psychological benchmark indicator for Singapore investors. I would go as far to say that this 3,000 benchmark is more of a resistance for Singapore stocks with the last time that the STI heading around this level only in January 2021 too.
With STI hovering around this 3,000 level, are Singapore stocks cheap or expensive now? For this, I turn to the SPDR Straits Times Index (STI) ETF (ES3.SI) for guidance. The STI ETF ES3.SI tracks the STI and hence I would think that it is a good proxy to gauge the metrics of the Straits Times Index.
Looking at the Price-to-Earnings ratio of the ES3.SI, I noted that the ratio is 18.06 (as of 8 Mar 2021). Yes, the Price-to-Earnings ratio of ES3.SI is 18.06 currently. I would think that at this Price-to-Earnings ratio, the Straits Times Index (or for the matter Singapore stocks) are not cheap. Or minimally, Singapore stocks are not cheap as before when this Price-to-Earnings ratio is around 11 or so.
I have not been investing in Singapore stocks nor will I do so right now. Some may think that stocks are poised to head further but I do not know of any good catalysts to propel the stock markets higher now.
That’s it for my insights today. I Thank you once again for your support of SG STOCKS INVESTING, your Money and Lifestyle magazine! Connect with me here to follow the daily exciting and useful posts on these two blogs, Thank You for your support!
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