STI's Growth Reflects Singapore's Economic Depth, Diversity: Analysts

Benchmark index has proved resilient amid stock market turmoil caused by US tariffs

- Angela Tan

Just as Singapore has grown over the past 60 years since independence, the Straits Times Index (STI), too, has evolved to better reflect the stock market and the local economy.

The three local banks – DBS Bank, OCBC Bank and UOB – have become much more dominant in the STI, which tracks the 30 largest and most liquid companies listed on the Singapore Exchange (SGX).

Their combined weight is now over 50 per cent, from about 34 per cent in 2014, reflecting Singapore's rise as a financial hub, according to Ms Belle Chang, senior manager, global investment research team at FTSE Russell, STI's administrator.

Telecommunications and utilities have also seen growing interest due to advancements in artificial intelligence and demand for data centres, supported by the Government's Green Data Centre Roadmap, she said.

With close to half of the revenue earned by companies on the STI generated overseas, the index today offers investors exposure to companies that make their money here, as well as overseas, and international ones too.

It includes international names such as Hutchison Port Holdings Trust and DFI Retail Group, a member of the Jardine Matheson Group, as well as Singapore companies that have been increasing their international business like City Developments and Keppel.

Today's STI is the latest iteration of Singapore's benchmark stock index, which dates back to 1966.

The STI has proved resilient during the stock market turmoil caused by US tariff uncertainties.