My Singapore Market Outlook for 2026

For the last decade, the narrative was "Sell Singapore, Buy America." The US had the growth, the tech, and the excitement. In 2026, I believe the script is flipping. While the West deals with a myriad of political drama, the Singapore market offers sanity, stability and strength.

The Valuation Gap

Right now, the US market is priced for perfection. The S&P 500 is trading at a premium that assumes nothing will ever go wrong. 

Singapore, however, remains fairly priced. Taking an average P/E ratio of the STI gives us around 16.8 at today's prices, while the S&P500 sits at a P/E of around 28. The valuation gap is glaring and investors must tread carefully to avoid companies that cannot justify their lofty valuations with earnings growth. 

What remains even more compelling are the dividend yields offered by stocks in the SG market. Many blue chip companies and REITs offer attractive, sustainable and growing dividend yields of 4-6%. Investors in these companies are paid significantly higher than the risk-free rates of around 1.5%. It is quite clear that when I buy a Singapore blue chip, I am getting a 5% cash return while I wait for capital appreciation. In the US, I am paying a premium just to sit at the table.

The Financial Safe Haven

The US policy landscape is becoming increasingly aggressive and unpredictable since last year. Rules can change via a tweet sent at 3AM. Tariffs can slap industries overnight, and it's always a possibility of new regulations affecting foreign investors in the US market such as capital gains tax.

Investors hate uncertainty. In contrast to the US, Singapore is incredibly "boring". We know exactly the government's plans for the next 5-10 years. As geopolitical tensions rise between East and West, Singapore remains the Switzerland of Asia. I foresee more money flowing into Singapore this year as the 

wealthy are seeking safe haven assets to park their wealth in.

The Growing Economy

Critics say that STI companies are boring, mature, "old economy" dinosaurs. In my eyes, our blue chips are "essential economy" stocks, tied to physical realities and growing alongside our economy.

Our SBanks (DBS, OCBC, UOB) are not just lending people money to buy HDBs. They are managing the massive influx of Asian wealth. They are the toll booths for the region's growth. 

Our Industrials support the economy's growing demand for energy. They are not software companies that can fade and be forgotten within a decade. Look at the crazy energy demand from data centers and AI. Who powers that? Sembcorp is one company selling shovels (energy) needed for the AI gold rush.

These are just couple examples of market leading companies that grow in tandem with the nation's economy. This knowledge is part of my home ground advantage as a Singaporean investing in local markets. Many companies in my stock portfolio are also among the market leaders in their respective fields. 

Conclusion

The US market to me looks more like a casino. It's open at night, it's potentially dangerous and it's expensive to get into. The Singapore market appears much more attractive to me as a place to quietly accumulate wealth and stack dividends. All Huat!