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So far in June 2026, the Singapore equity market is experiencing a slowdown with people being away on holiday and, soon enough, paying more attention to the FIFA World Cup. |
| DBS’s 3 Strategies for Singapore Tech Stocks |
One of the aspects of DBS's accumulation strategy is it's focus on the Singapore technology sector.
Tech stocks have enjoyed a stellar run, "underpinned by renewed AI enthusiasm and supportive 1Q26 results".
Recognising that there might be some near-term profit-taking after these significant year-to-date gains, DBS outlines three strategies:
1. Buy Semiconductors on Pullback
DBS’s top strategy involves scooping up semiconductor stocks, specifically UMS, followed by AEM, and then Frencken.
The analysts say these names are "buy-on-pullback given intact key customer and product-cycle drivers".
"Odds of near-term profit taking on stellar YTD gains have risen, as reflected in waning m/m price momentum and rising investor selectivity in May.
"That said, our high conviction on this sub-sector still holds, underpinned by intact drivers (UMS – strong order momentum from key customers, AEM – multiple tailwinds from CPU, fabless AI, memory, OSAT) that should materialise over the year".
2. Capitalise on Venture’s Recovery
For investors seeking a more balanced growth-and-yield play, DBS highlights Venture Corp.
"Venture is emerging as a recovery play alongside nascent but growing AI/semiconductor exposure".
The analysts confidently point out that for Venture, "the worst likely over following its 1Q26 update, underpinned by improving operational execution and expanding AI/semiconductor exposure cited as an important growth driver ahead".
| Buy semiconductor plays |
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"Singapore tech stocks extended their strong run into May, underpinned by renewed AI enthusiasm and supportive 1Q26 results. While rising odds of near-term profit-taking after stellar YTD gains, the preferred positioning remains clear. First, semiconductor names (UMS > AEM > Frencken) are buy-on-pullback given intact key customer and product-cycle drivers." |
3. Explore Early-Stage AI Potential For investors willing to accept "higher upside potential but greater execution risk," DBS recommends looking at non-rated equity explorers InnoTek and MetaOptics as "potential earlier-stage AI plays".
The rationale is distinct for both.
InnoTek "offers a clearer near-term monetisation path through its AI server components ramp," expecting its server revenue mix to rise significantly to 30% by FY27F.
Meanwhile, MetaOptics is the "earlier-stage option, backed by metalens technology and industry validation."
But its success depends on turning engagements into revenue-generating contracts.
While the broader market might be distracted by holidays and football, the June weakness offers a window to build your portfolio. |
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