S-REITs attract $95.4m in institutional inflows as technology stocks slide

Institutional net outflows reached $57m over five sessions.

Singapore-listed real estate investment trusts (S-REITs) attracted institutional buying last week as technology and financial stocks came under pressure amidst global market volatility, according to the Singapore Exchange (SGX).

S-REITs gained 2.5% on a market-cap-weighted total-return basis and recorded $95.4m in net institutional inflows over five sessions. Of the 39 trusts, 34 posted positive weekly total returns, four declined, and one was unchanged.

ESR-REIT led the gains, rising 5.6%, followed by CapitaLand China Trust at 5.0%, CapitaLand India Trust at 4.8% and Mapletree Pan Asia Commercial Trust at 4.3%. However, their year-to-date total returns remained negative, ranging from -13.6% to -22.8%.

CapitaLand Ascendas REIT gained 2.3%, narrowing its year-to-date loss to 15.3%. Keppel DC REIT and CapitaLand Integrated Commercial Trust advanced 2.8% and 2.6%, respectively, bringing both to positive year-to-date total returns of about 2.3%.

Institutional inflows accompanied gains in several trusts. CapitaLand Ascendas REIT attracted $46.4m in net institutional inflows, followed by CapitaLand Integrated Commercial Trust at $13.1m and Keppel DC REIT at $9.9m. Mapletree Pan Asia Commercial Trust received $7.7m, whilst ESR-REIT recorded $1.9m.

“Last week, global equity volatility was led by weakness across semiconductors, technology hardware, software and telecommunications stocks, amidst concerns over AI spending, regulation and returns following the US midterm elections,” SGX said.

Bloomberg reported that the technology sell-off coincided with a rally in US Treasuries as investors reassessed the outlook for AI investment, regulation and interest rates.

The S&P 500 and Nasdaq fell 2.7% and 4.9%, respectively, over the first four sessions of last week before recovering 3.4% and 2.4% across Friday and Monday.

In Singapore, technology stocks and the three major banks bore the clearest impact. Technology stocks recorded $71m in net institutional outflows.

AEM fell 16.8% and saw $27.1m in net outflows, whilst UMS declined 15.9% with $10.1m in outflows. Venture lost 5.2%, recording $13m in outflows, whilst CSE Global fell 6.3% with $10.9m in outflows.

Financial Services recorded the largest sector net institutional outflow at $88.2m. DBS fell 4.7% and recorded $63.4m in net outflows. OCBC declined 5.3% with $24.7m in outflows, whilst UOB dropped 10.9% with $10.2m in outflows.

Combined net institutional outflows across the three banks reached $98.4m, partly offset by inflows elsewhere in the Financial Services sector.

All three banks recorded net outflows during the five-session period, rather than a rotation of institutional funds between them.

Singapore's other defensive stocks received less consistent support. Sheng Siong fell 12% and recorded $17.4m in net institutional outflows. Wilmar International declined 1.3%, with $34m in outflows, whilst First Resources dropped 18.8% with $22.3m in outflows.

Singtel and NetLink NBN Trust also recorded net institutional outflows of $6.1m and $6.8m, respectively.

Institutional buying in the Industrials sector was concentrated in selected stocks. Jardine Matheson attracted $51m in net inflows, followed by Singapore Airlines at $36.8m, Yangzijiang Shipbuilding at $14m and SATS at $12.5m.

The sector recorded $73.6m in net institutional inflows overall, despite declining 1.7% on a market-cap-weighted total-return basis. Keppel and ST Engineering recorded net outflows of $28.8m and $21.8m, respectively.

Outside REITs, DFI Retail Group gained 7%, whilst Jardine Matheson and Jardine Matheson Southeast Asia advanced 5.6% and 3.7%, respectively. Their year-to-date total returns stood at -2.2%, -8.5% and -24%, respectively.

Consumer-sector positioning was also stock-specific. DFI Retail Group, Thai Beverage and Golden Agri-Resources attracted net institutional inflows of $8.1m, $3.6m and $1.7m, respectively. Wilmar International, First Resources, Sheng Siong and Bumitama Agri, meanwhile, recorded net outflows.

Despite the volatility, the five-session net institutional outflow of $57m was below the year-to-date average weekly pace of about $100m. This was based on total net institutional outflows of $4.5b over the preceding 45 weeks.

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