SG Strategy: Deutsche has strategy report following 1Q earnings. Note that earnings momentum slows and yield supportive. House cuts market EPS f/casts by 2.6% on the back of rising costs and accounting changes. Expect a less supportive macro environment; slower 2Q and near-term policy uncertainty, while market valuations are still modest…..
Recommend investors to focus on O&M Secor, tipping a return to value as headwinds turn and continuing upside surprises on order wins. Investors should start positioning in stocks that are trading at sizeable discounts to valuations with medium-term re-rating catalysts and upside potential for div yields, which includes banks (benefit from reversal in nterest rate cycle), SIA and property. House top picks are SCI, Keppel Land and GENS, while top sells are NOL and M1.
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