SGX Shares Take a Hit as Citi Downgrades to "Sell"
Citi Research Lowers Price Target to S$11.90
The Singapore Exchange (SGX) could potentially give up much of its gains since unveiling its first-half results, as Citi Research downgraded its call on the counter to "sell" on Friday. The research firm expects the recent optimism priced into the counter’s valuation to unwind.
Citi’s Downgrade and Price Target Reduction
Citi lowered its price target to S$11.90, citing a potential unwinding of the recent optimism. The news sent shares of SGX tumbling more than 6% or S$0.85 to S$12.62 just after market open on Friday. As of 1:44 pm on Friday, the stock was trading at S$12.68.
MAS’ First Set of Measures for SGX
The Citi downgrade comes a day after the equities market review group of the Monetary Authority of Singapore (MAS) announced its first set of measures. The review group proposed introducing tax incentives to attract enterprises and fund managers to list in Singapore, as well as encouraging the launch and growth of funds with substantial investment in local equities.
MAS’ Proposals Submitted to Prime Minister
The first set of measures has already been submitted to Prime Minister and Minister for Finance Lawrence Wong, with a fuller update on these measures scheduled for February 21.
Conclusion
The Citi downgrade and price target reduction may indicate a potential unwinding of the recent optimism priced into the SGX’s valuation. As the market waits for further developments on the MAS’ measures, investors may want to exercise caution when considering a position in the counter.
Frequently Asked Questions
Q: Why did Citi Research downgrade its call on SGX to "sell"?
A: Citi expects the recent optimism priced into the counter’s valuation to unwind.
Q: What is the new price target for SGX set by Citi Research?
A: S$11.90
Q: What are the MAS’ first set of measures for the SGX?
A: The MAS proposed introducing tax incentives to attract enterprises and fund managers to list in Singapore, as well as encouraging the launch and growth of funds with substantial investment in local equities.
Q: When will the MAS provide a fuller update on its measures?
A: February 21.
