The Motley Fool

The Monthly Nibble: Stock Market Correction and Blue-Chips

Here are some of the most popular articles that have appeared on the Motley Fool Singapore’s website this month.

1. Singapore’s Stock Market Correction is Here: What Investors Should Do Now

Earlier this month, the Singapore stock market took a beating due to the additional property cooling measures announced by the government. Investors might remember that well.

The government raised the Additional Buyer’s Stamp Duty (ABSD) rates, and tightened the Loan-to-Value (LTV) limits for residential property purchases. In a knee-jerk reaction, the Straits Times Index (SGX: ^STI) fell 2% on 6 July 2018.

With the market decline, my Foolish colleague, Chin Hui Leong, reminded all of us in his article that the “sharp decline sounds like a horrible thing to happen, but it also quite a common occurrence in the Singapore stock market”.

Indeed, all is not lost. The index went on to rise by around 115 points, or 3.6%, from that day up till 30 July 2018, and it could go on to rise further. It’s a timely reminder that short-term market fears create opportunities to buy stocks on the cheap.

Some of the stocks discussed in the article include CapitaLand Limited (SGX: C31) and DBS Group Holdings Ltd (SGX: D05).

2. 2 Formidable Singapore-Listed Stocks That You Can Pass On To The Next Generation

In this article, I discuss the reasons why SATS Ltd (SGX: S58) could be a keeper in your portfolio for the long-term. I picked the stock based on three simple questions inspired by the widely-respected investor, Warren Buffett. The questions are:

1) Is the business simple to understand?

2) Does the company have a durable competitive advantage?

3) Will the business still be around for decades to come?

In my view, the answers for the above three questions are a resounding “Yes”. Check out the article to learn more about the key characteristics of SATS.

3. The Better Telco Dividend Stock: Singapore Telecommunications Limited or StarHub Ltd?

As of 6 July, local telcos Singapore Telecommunications Limited (SGX: Z74) and StarHub Ltd (SGX: CC3) were sporting trailing dividend yields of 5.4% and 9.5% respectively. The comparison may lead us to think that StarHub is a better dividend stock than Singtel.

However, dividend yields tell us nothing about the sustainability of the underlying dividends. By looking at additional metrics such as dividend growth rate and dividend payout ratio, I reveal the telco which could be the better income stock.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of  DBS Group Holdings Ltd and SATS Ltd. Motley Fool Singapore contributor Sudhan P owns shares in SATS Ltd.