Trump's Impact on Singapore Banks, Manufacturers Limited: Analysts

Uncertainties about his tariff plans remain, especially their scope and intended targets

- Sheila Chiang

Singapore's banking and manufacturing stocks are likely to face limited impact from US President Donald Trump's policies, analysts said, after the local share market dipped on the first day of trading following his inauguration.

The Straits Times Index dropped 0.3 per cent on Jan 21 and 0.4 per cent on Jan 22.

On his first day in office on Jan 20, Mr Trump did not announce new tariffs but said he was considering imposing 25 per cent duties on imports from Canada and Mexico on Feb 1.

Late on Jan 21, he said that his administration was discussing a 10 per cent tariff on Chinese imports, a move that would escalate trade tensions between the world's largest economies.

Mr Trump also plans to direct US federal agencies to review trade practices and policies with China and other allies.

Ms Selena Ling, chief economist and head of global markets research and strategy at OCBC Bank, said that uncertainties remain regarding Mr Trump's tariff plans, particularly concerning their scope and the countries that may be targeted.

"If we assume our free trade agreement with the United States holds, then Singapore may be less affected by the direct tariff impact," Ms Ling said.

She added that while Mr Trump is pushing for the onshoring of manufacturing in the US, especially high-end advanced chips, it is still unclear of whose interests this might be at the expense.