SINGAPORE – Buoyed by reforms to the local equities market, Singapore stocks performed well in the first quarter of 2026, but markets have since turned more volatile as the Iran war clouds the outlook.
The Straits Times Index (STI) rose 5.1 per cent between January and March to 4885.45 points, with dividends lifting total returns to 5.6 per cent, data from the Singapore Exchange (SGX) showed.
It noted that the STI’s performance is strong compared with other indexes: The FTSE APAC Index delivered 0.4 per cent total return, and the FTSE World Index declined 3 per cent in Singapore dollar terms.
“The STI’s outperformance against regional peers and sustained fund inflows into Singapore equities in March reinforce its safe-haven status,” DBS Bank analysts wrote in an April 1 report.
“This is also supported by Singapore’s resilient growth momentum heading into this conflict, and by oil prices rising in a way that lifts inflation without materially denting growth.”
The 10 best performing stocks in the first quarter, among those with market capitalisations over $10 billion, included ST Engineering, Wilmar, SGX, HongkongLand, Keppel, OCBC bank and Sembcorp.
Some companies have seen gains as the war entered its fifth week this week.
OCBC Bank surpassed $100 billion in market capitalisation for the first time, as its shares breached the $22 mark on March 31.
This was buoyed by potential wealth inflows from the Middle East and another interest rate cut on its flagship savings account.
Analysts said all three local banks are likely to benefit from wealth inflows, but cautioned that a risk-off environment could curb investment activity and limit deployment into higher-yielding assets.
OCBC shares closed on April 2 at $22.38, up more than 4 per cent this week.
DBS also rose. Its chief executive Tan Su Shan said during the bank’s annual general meeting on April 1 that the first-order impact of the war on the bank is “very little” as it has minimal exposure to the region, with Asia as its core market.
DBS shares closed at $57.55 on April 2, up by more than 1 per cent across the week.
ST Engineering said on April 1 that its marine unit has secured a six-year sub-contract worth about $600 million from Abu Dhabi Ship Building to design and supply platform systems for eight missile gunboats being built for the Kuwait Naval Force.
In addition to delivering the full suite of platform design, integration and technical expertise, ST Engineering will build three of the vessels at its Singapore shipyard.
Mr Tan Leong Peng, president of ST Engineering’s marine business, said: “This win strengthens ST Engineering’s growing momentum in international defence markets, underscoring the group’s ability to deliver sophisticated naval platforms and capture rising demand for advanced maritime security solutions in the Middle East.”
