Singapore's Reputation as Haven for Solid Gains Takes a Hit, but Managers Urge Long-Term View
SINGAPORE -- Singapore's reputation as a haven for those seeking solid, if not spectacular, gains took a hit in the first quarter, as the market's main index fell more sharply than all others in Southeast Asia.</br></br>But that doesn't mean investors should shift to higher-risk, potentially higher-return Asian markets, fund managers and analysts say. Instead, they say, investors need to study what has changed in Singapore companies while maintaining a long-term view. Those with a distant horizon and stock-picking acumen have found Singapore a good investment, they say.</br></br>Singapore's Straits Times Index was closed yesterday for a holiday, as other major markets in Asia finished higher. Continental European markets were generally higher, while London was closed for a holiday. Overall, the Dow Jones World Stock Index fell 0.01 point, or 0.01%, to 199.28. Excluding the U.S., the index rose 0.58 point, or 0.40%, to 146.77.</br></br>The first quarter proved that during global selloffs, the redundant phrase "safe haven" doesn't exist for stocks. "The only safe haven is cash -- or utilities in Hong Kong," says Sean Darby, regional strategist at Dresdner Kleinwort Wasserstein.</br></br>And some analysts and strategists aren't sure all the bad news has come out. Merrill Lynch has been "underweight" on Singapore for more than a year. And analysts believe that changes due May 19 in Morgan Stanley Capital International indexes will cut weightings for some local companies.