STI edges up 0.2% as Singapore shares rise on soft US jobs data and growing rate-cut bets

Singapore equities found a steadier footing on Sept 4, with the Straits Times Index rising 0.2 per cent, or 7.5 points, to 4,296.83. Turnover was active at 1.6 billion securities worth $1.3 billion, although market breadth stayed soft as decliners outnumbered advancers, 267 to 255. The tone matched a day that asked for selectivity rather than broad risk, and the print reflected that.

Across Asia, the tape was mixed. South Korea’s Kospi added 0.5 per cent and Japan’s Nikkei 225 climbed 1.5 per cent, while Malaysia’s KLCI was essentially flat. China underperformed after fresh reports that regulators could tighten curbs on speculative trading. The Shanghai Composite slipped 1.3 per cent, and Hong Kong’s Hang Seng dropped 1.1 per cent. The region continued to price two opposing forces at once: easing US policy and persistent China-specific headwinds.

The US signal mattered. Federal Reserve Governor Christopher Waller reinforced expectations for a September rate cut, pointing to weaker labour data and a case for gradualism that keeps additional steps dependent on incoming numbers. Markets took that as confirmation that policy is tilting away from a pure inflation fight toward labor and growth risk management. For Asia, that shift often feeds through the dollar first, then into local yields, and finally into equity factor performance. Lower US rates usually temper dollar strength, relieve imported tightening, and give higher-dividend and balance sheet-solid names a relative bid.

That connection showed up in portfolio positioning rather than index points. Eastspring Investments’ chief economist Ray Farris and multi-assets portfolio manager Nupur Gupta argued that softer US growth and rate cuts tilt the backdrop toward firmer Asian currencies, which in turn puts currency hedging of US dollar exposures back on the agenda for regional investors. The logic is straightforward. If carry narrows and the dollar drifts, unhedged dollar assets introduce unwanted FX noise into returns. For allocators benchmarked in Asian currency terms, simple hedges can protect performance without touching core holdings.

They also cautioned that tariff risk is not going away. Even with a friendlier rate path, a slow-burn drag from broader or deeper tariffs would show up in margins and a patchier inflation mix in the US. That is a volatility channel, not a growth engine, and it argues for disciplined risk budgeting in the months ahead. For Singapore, which prices itself as a defensive, cash-yield market, that combination can be supportive, provided cross-border trade volumes do not deteriorate sharply.

On the Straits Times Index, leadership was modest but clear. Venture Corp gained 2.2 per cent, or 29 cents, to $13.58, a move consistent with the market’s bias toward proven, cash-generative tech services over higher beta hardware or concept growth. The banks were constructive, adding a layer of yield and balance sheet credibility that investors prefer when global rates approach an inflection. DBS rose 0.3 per cent, or 14 cents, to $50.54. OCBC added 1.1 per cent, or 18 cents, to $16.98. UOB advanced 0.6 per cent, or 20 cents, to $35.76. Financials in Singapore carry both dividend appeal and capital strength, and they benefit from a smoother rate glide path that flattens tail risks without gutting net interest margins overnight.

Real estate investment trusts were mixed. Frasers Centrepoint Trust slipped 1.7 per cent, or four cents, to $2.32, a reminder that REIT pricing still toggles between yield support and duration sensitivity. If the Fed cuts in measured fashion, the sector’s income case improves, but news flow around tenants, asset disposals, and refinancing costs will continue to select winners and laggards.

Regionally, the China question remains the swing factor for risk appetite. Talk of further constraints on speculation is not new, but it tightens the near-term playbook for traders who had been betting on a policy-driven bounce in onshore liquidity. For Singapore investors, that means China beta is best held through quality and cash flow rather than theme or momentum. The market will reward balance sheets, predictable payouts, and operational moats. It will not reward exposures that rely on a quick sentiment flip without accompanying earnings traction.

Under the surface, the day’s pattern fits a bigger story. As the Fed transitions toward cuts, the equity impulse changes shape. The first effect is duration relief that supports large-cap defensives and high-dividend names. The second is FX normalization that reduces the dollar’s headwind for Asian assets. The third, slower effect is earnings sensitivity to global trade and inventory cycles. Singapore’s market architecture, with its banks and REITs anchor and a smaller cadre of tech and industrial champions, is built for the first two effects. The third will depend on how tariff policy and US consumption evolve through year-end.

SGX stocks rebound on Sept 4 is therefore less about a single macro headline and more about a positioning pivot that prefers cash yield, currency sanity, and operational clarity. If the cut arrives and the path remains data dependent, that playbook should hold. It does not require aggressive risk. It requires patience, steady hedging for dollar exposures, and a bias toward businesses that can defend margins if tariffs bite harder than expected.

The bottom line is simple. Rate relief is coming, China volatility is not done, and Singapore’s defensive equity profile continues to earn its premium when the world trades between narratives rather than in one direction. Today’s tape leaned into that reality, and the winners looked exactly like the market’s current rule set would suggest.