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Analyst remains neutral on S-Reits amidst global financial situation

There may be tighter financial conditions in the US due to interbank rates.

Those planning to invest in Singapore REITs should be neutral as the global financial market remains uncertain, said Maybank.

“However, US short-term interbank rates are higher and credit spreads are wider from last week. US investment grade and high yield credit default swap spreads widened 7.8bp and 36.4bp,respectively. Singapore has seen similar moves, albeit on a smaller scale,” it said.

According to the bank, the top recommended S-Reits are CapitaLand Integrated Commercial Trust, Frasers Centrepoint Trust, ESR Logos REIT, Mapletree Industrial Trust, CDL Hospitality Trust, CapitaLand Ascott REIT, and Far East Hospitality Trust.

It suggested that fall in yields is good for this segment and that industrial and hospitality sub-sectors are preferred.

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