JPMorgan Lifts Singapore Stock Target to 7,000

JPMorgan Chase & Co has raised its target for Singapore stocks due to robust economic growth and a narrowing valuation gap with developed-market peers.

The Straits Times Index (STI) may climb up to 7,000 over the next 12 months in a bull case scenario, according to JPMorgan analysts, including Khoi Vu. This target implies a 22% upside from STI's close on August 11.

Singapore's economic growth has been driven by the AI boom, which is lifting trade and manufacturing, offsetting the drag from continued fighting in the Middle East. A stronger Singapore dollar also supports local equities.

JPMorgan analysts say that while valuations have broken out of averages, they believe this level will be sustained as the STI reprices closer to other developed markets driven by high yield and a stable currency.