MAS' Fund Allocation Initiative Helps Lift STI to an All-Time High

Smaller stocks like Nam Cheong, Oiltek, Nanofilm and Lum Chang Creations shine

- Alyssa Woo

Whoever said the Singapore stock market was boring would have had to eat their words, given the amount of action that took place last week.

For starters, the Monetary Authority of Singapore (MAS) on July 21 said it would allocate a combined $1.1 billion to three fund managers to invest in the local stock market.

With MAS putting money to work through the fund managers, the hope is that others will follow suit.

The three fund managers are Avanda Investment Management, Fullerton Fund Management and JP Morgan Asset Management, with the next batch of fund managers expected to be announced by the fourth quarter of 2025.

The $1.1 billion is part of the $5 billion set aside under the Equity Market Development Programme announced by MAS in February, which allocates capital to a range of funds managed by local as well as foreign fund managers based in Singapore. Eligible fund strategies include those focused on Singapore equities, or with a significant allocation to them.

MAS deputy chairman Chee Hong Tat said on July 21 that the asset managers should help crowd in private capital, and boost interest and liquidity in Singapore equities, particularly small to mid-cap companies.

Mr Chee, who is also Minister for National Development, added that the aim is not just to inject funds into the Singapore market, but also to develop the fund management industry.

The move helped to lift the benchmark Straits Times Index (STI) to an all-time high of 4,273 points on July 24. The blue-chip index closed on July 25 at around 4,261 points, buoyed by stocks such as DBS Bank, Yangzijiang Shipbuilding and DFI Retail Group.

SMALLER-CAP STOCKS IN THE SPOTLIGHT

But it was the smaller, non-STI stocks like Nam Cheong, Oiltek International, Nanofilm Technologies and newly listed Lum Chang Creations that stole the spotlight last week.