Where is STI heading at end of 2015?

Annual growth rates for Singapore real Gross Domestic Product (GDP) were mapped to the Straits Times Index (STI) at the end of each year. This table shows real GDP growth rates since 1997 and the corresponding STI at the end of that year.

Year GDP growth rate (%) STI
1997 8.3 1529
1998 -2.2 1392
1999 6.1 2479
2000 8.9 1926
2001 -1.0 1623
2002 4.2 1341
2003 4.4 1764
2004 9.5 2066
2005 7.5 2347
2006 8.9 2985
2007 9.1 3482
2008 1.8 1761
2009 -0.6 2897
2010 15.2 3190
2011 6.2 2646
2012 3.4 3167.08
2013 4.4 3167.43
2014 2.9 3365.15
2015 F 2.2 ?

Source: Singapore Department of Statistics (for GDP numbers)

Forecast for 2015

We are now in September. The GDP forecast made by the Ministry of Trade and Industry for 2015 was between 2.0% to 2.5%. DBS released its forecast for GDP to grow at 1.8%. The private sector economists forecast GDP to be +2.2%.

STI at end 2015?

GDP forecast for 2015 appears to be worse off compared to last year’s (2.9%). Confidence in the Singapore economy was weak based on a survey of business sentiments. So naturally, confidence in Singapore equities is getting a hit. At GDP growth of 2.9%, the STI ended at 3,365.15 points in 2014. What about 2015? There are many factors influencing the STI. STI as at yesterday was 2,928.18 points. One thing I can wager on is that 3,365 points will be hard to attain with slightly more than a quarter to go in 2015. I am not too sure about the floor for the STI.

Copyright © 2015, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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