Daily Debrief: What Happened Today (Jul 25)
Singapore manufacturing output grows by better-than-expected 8% in June
Output in the key electronics sector is up 6.6%, extending May's 3.4% increase.
Private home prices up 1% in Q2, rents rise 0.8%: URA
The latest index figure is higher than the flash estimate released earlier; new home sales halve to 1,520 units, from 3,139 units in Q1.
Median resale prices top S$1 million for 4-room HDB flats in three towns in Q2
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Overall resale flat prices continue to moderate in the quarter with 0.9% rise.
Most Singaporeans are unprepared and underinsured for long-term care: Singlife
While long-term care costs close to S$3,000 a month on average, the insurance provider finds that more than half of those surveyed underestimate the amount.
Home-based pet boarding in Singapore grows on low cost, high demand
Unlicensed but in demand, informal pet sitters are reshaping the scene. But with regulatory hurdles, does this micro-industry have a future?
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Business Times
3 hours ago
- Business Times
Germany's Merz welcomes EU trade deal with US
[BERLIN] German Chancellor Friedrich Merz on Sunday welcomed the trade deal between the United States and the European Union, which he said avoided 'needless escalation in transatlantic trade relations' - even as many industries criticised it. 'We have thus managed to preserve our fundamental interests, even if I would have wished for more relief in transatlantic trade,' he said in a statement released soon after the deal was announced. The agreement sets 15 per cent tariffs on most exports from the European bloc. The United States is Germany's main trading partner. Merz said he was particularly relieved for the car industry, which before Sunday's accord was facing tariffs of 27.5 per cent. In addition to cars, Germany's chemical and machinery industries are particularly dependent on exports to the United States. And Germany's powerful BDI federation of industrial groups said the accord would have 'considerable negative repercussions' and sent 'a fatal signal to the closely interdependent economy on both sides of the Atlantic'. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Germany's chemical trade association VCI said the accord left rates 'too high'. 'When one expects a hurricane, you rejoice at a simple storm,' it said in a statement. 'An escalation was avoided, but the cost is high for both sides.' The country's BGA exporters association called it a 'painful compromise' that creates an 'existential threat' for many companies. Clemens Faust, head of the prestigious IFO economic institute, said the agreement represented a 'humiliation for the EU that reflects the imbalance in power'. There are still many details in the accord that need to be ironed out, and the Chancellor expressed his 'full support' for the European Commission 'for the negotiations that will now begin'. German Finance Minister Lars Klingbeil said the agreement was 'a good thing as a first step. 'We will now assess the outcome of the negotiations and its impact on the economy and employment in Germany,' he added. AFP
Business Times
4 hours ago
- Business Times
How reliable is the 60/40 portfolio in downturns? Adding private debt not a panacea
[SINGAPORE] A big argument in favour of an investment in private markets is that the traditional 60/40 balanced portfolio (60 per cent stocks, 40 per cent bonds) is no longer as reliable or robust as it traditionally was. The steep portfolio loss in 2022 when stocks and bonds fell at the same time – and each asset class by double digits – has likely scarred most investors. It is no coincidence that since that year, strategists and bankers have redoubled efforts to persuade investors to invest in assets that are less correlated with public markets. Institutions and private wealth advisers alike are pinning their hopes on private markets to drive not just overall portfolio returns but also dampen risk. BlackRock chairman Larry Fink in his 2025 letter wrote that the future standard portfolio may have the allocation of 50/30/20 – that is, 50 per cent stocks, 30 per cent bonds and 20 per cent in private assets such as infrastructure, real estate and private credit. 'Generations of investors have done well following (the 60/40) approach, owning a mix of the entire market rather than individual securities. But as the global financial system continues to evolve, the classic 60/40 portfolio may no longer fully represent true diversification,' he wrote. The big question dogging the 60/40 method is not so much that of the risk and return of equities, but rather of bonds. Have bonds lost their ability to diversify? It is significant that the three types of private assets Fink cites are those that come closest to bonds. Infrastructure, real estate and private credit all generate a yield. Private assets also show lower correlation with public markets. Retail investors are able to access listed infrastructure and real estate investment trusts. Private debt is currently confined to accredited investors. And, in today's environment, there may be reasons for caution in private debt, which I will touch on shortly. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Strategists are not calling for the scrapping of the 60/40 portfolio, but to enhance its diversification benefits. Still, some fund managers maintain that the 60/40 approach continues to prove its value even without private markets, and the 2022 experience was an outlier. Morningstar noted that 2022 was the single year over a 150-year period that bonds failed to provide diversification benefit in a downturn. Could it happen again? 60/40 portfolio's track record Erin Browne, Pimco managing director and portfolio manager, said that the 60/40 portfolio has proven its resiliency – not just over the past decade but over more than 30 years. Browne, based in Pimco's Newport Beach office, looks after the firm's multi-asset strategies. Pimco manages more than US$2 trillion in assets. 'Our portfolio is up by around 10 per cent year to date, and the (reference) 60/40 is up by 8 per cent. It really has proven to be a good core ballast of delivering portfolio returns over different market environments and histories. This year is no different,' she said. Pimco's data shows that since 1990, a global 60/40 portfolio has returned just 0.7 per cent less than global stocks on an annualised basis, but with 37 per cent less volatility. 'The US stock-bond correlation has gotten more negative over recent months, with the one-year correlation dropping from 0 to minus 15 per cent. This is particularly valuable in an uncertain macro environment; both stocks and bonds can benefit from a soft landing amid central bank rate cuts,' she added. 'If growth deteriorates faster than expected, high-quality bonds provide a ballast. Finally, the long-term track record and easy-to-understand benefits of a 60/40 allocation allows investors to stay invested rather than attempt to time the market, which typically causes underperformance.' Browne said inflows into Pimco's multi-asset offerings are not just from retirement savers, but also more broadly from investors looking to build a 'strong, stable bellwether' as their core portfolio. 'Flows are really coming from investors looking to create the core of their asset allocation strategy, where they're able to participate in continued upside in equities, and also have some diversification.' She believes volatility is likely to be elevated given the geopolitical and macroeconomic shifts, from a 'unique unipolar world' to a multi-polar world, and from global cooperation to fragmentation. 'There will be friction in that change… Growth is also slowing on a global basis, and that creates pockets for disruption within global markets and equities, which creates more volatility.' Morningstar research found that the poor performance of the 60/40 portfolio in 2022 was due to a painful bear market in bonds that actually began around 2020. In its analysis of how the 60/40 portfolio performed over 150 years, it found that the crash of the 2020s was the only one where the decline of the 60/40 portfolio was more painful than that of an all-stock portfolio. That is, while the deepest drawdown of the 60/40 portfolio was shallower than the all-equity portfolio, it has taken the 60/40 portfolio longer to recover. In the 2020s, the downturn in equities – brought on by the Ukraine war, higher inflation and supply shortages – coincided with a bear market in bonds. 'While the stock market recovered to its previous high in September 2024, the bond market has not yet fully emerged from underwater. This decline was so severe that it prevented the 60/40 portfolio from returning to its previous high until June 2025 – marking the only time in the past 150 years that the 60/40 portfolio experienced more pain than the stock market,' it said. 'Nonetheless, even in this once-in-150-years bond bear market, the depth of the decline experienced by a 60/40 portfolio was less than that of either the stock market or the bond market alone.' Pimco's Browne argued that the starting point of bond yields is key for an investor. 'I don't think fixed income as a risk diversifier is dead. There's real potential for fixed income to continue to deliver not only on income return but also diversification,' she noted. 'In 2020 inflation ran very high, and the starting points of yields were exceptionally low in a negative or zero-rate environment. But where we are today is quite different. The starting point of yields today provides a really nice cushion to protect portfolios in risk-off events, with 10-year yields exceeding 4 per cent. Yields tend to be very highly correlated with the expected return of the asset over the next five years.' Caution on private credit What about private credit as a bond proxy? Despite an attractive yield, it is not a panacea for returns or lower risk. There is also reason for caution when almost every private banker or sales person trots out private debt offerings. According to an article in the Financial Times, the GIC itself is cautious as the asset class is untested in a major credit default cycle. GIC chief investment officer Bryan Yeo reportedly said the investment company is 'raising the bar in terms of further deployment in the private credit space', adding: 'We're now at a part of the cycle where we feel that spreads are a lot tighter, and valuations are also higher.' Pimco is wary as well. It noted in its mid-year report that credit spreads remained tight relative to historic averages despite signs of 'elevated secular recession potential', which reflects some complacency in public and private credit markets. Private credit, it said, is vulnerable to broad risk asset repricing due to its 'large allocations' into technology and artificial intelligence disruptors. 'Amid limited fiscal space, a genuine credit default cycle – unlike the recent 'buy the dip' era – may unfold for the first time in years, catching many investors unprepared… We express caution in areas of private corporate credit where capital formation has outpaced investable opportunities, leading to potential disappointment.'
Business Times
5 hours ago
- Business Times
Data centres aren't sexy but essential and increasingly lucrative
With US$4.7 billion pumped into direct data centre investments in Asia-Pacific in 2024 alone, and momentum holding strong this year, investors are circling. AI and cloud computing are fuelling demand. But is this asset class really within reach for retail investors? In this episode of Money Hacks, a podcast by The Business Times hosted by Howie Lim, we find out what's driving the data centre boom and how individuals can get a piece of the pie. Daphne Tan from CMC Markets and Shun Endo from CBRE unpack the landscape, including how listed Reits especially those with 'hyperscaler' tenants like Google or Microsoft offer a way in, why modular designs are keeping things future-proof, and what to watch when it comes to power, scalability, and resilience. Why listen? Because data centres are the quiet overachievers of tech infrastructure Steady demand, long leases, and capital-sticky tenants make them a surprisingly defensive play. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Because investing doesn't always mean betting on the next app Data centres are how the internet stays on. Reits let you invest in the plumbing not just the party. Because risks exist—but they're being managed smartly Think disaster planning, power redundancy, and upgrades without full rebuilds. Because with AI exploding, someone's got to house the servers And chances are, it's one of the players mentioned in this episode. Money Hacks is the flagship personal finance podcast from The Business Times, hosted by Howie Lim. You can listen to past episodes including recent takes on gold, ETFs, and long-term investing on Spotify, Apple Podcasts, or at Have feedback or episode ideas? Drop the team a note at btpodcasts@ --- Written and hosted by: Howie Lim (howielim@ With Daphne Tan, head of business development, CMC Markets and Shun Endo, head of data centre, capital markets, Asia Pacific, CBRE Edited by: Howie Lim & Claressa Monteiro Produced by: Howie Lim & Chai Pei Chieh A podcast by BT Podcasts, The Business Times, SPH Media --- Follow BT Money Hacks podcasts every Monday: Channel: Amazon: Apple Podcasts: Spotify: YouTube Music: Website: Do note: This podcast is meant to provide general information only. SPH Media accepts no liability for loss arising from any reliance on the podcast or use of third party's products and services. Please consult professional advisors for independent advice. --- Discover more BT podcast series: BT Correspondents: BT Market Focus at: BT Podcasts at: BT Branded Podcasts at: BT Lens On:
