Based on the P/B chart, the STI is cheap – trading not too far off the lows of 2016.
The banks now have really driven valuations lower as we talked about in our recent webinar on banks.
About the Straits Times Index:The FTSE Straits Times Index (STI) is a capitalisation-weighted stock market index that is regarded as the benchmark index for the Singapore stock market. It tracks the performance of the top 30 companies listed on the Singapore Exchange.
What’s Price-to-Book?The price-to-book chart (P/B chart) is a useful complement for investors trying to understand how cheap or expensive a certain sector or country is.
In the case of Singapore, the Straits Times Index is dominated by many traditional businesses such as the three banks (UOB, OCBC, DBS) and the P/B chart is a decent proxy for investors to assess how expensive or cheap the market
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