To The Moon

💫Yesterday, the Straits Times Index (STI) hit a new record high of 5,619.20, refreshing the last record of 5,595.52 on 22 July 2026

📈 $Amova STI ETF S$D(G3B.SI)$ likewise, closed at a new record high of SGD 5.735 yesterday

According to Bloomberg AskB, the Amova STI ETF and STI moves in “near-lockstep, with a one-year daily return correlation of 0.91”

✳Since newly listing on 17 July, Macquarie’s Amova STI ETF call warrant $Amova STI MB eCW261229(OUKW.SI)$ , has risen 15.8% to SGD 0.088 (as of yesterday’s close), 7.5 times more than the ETF’s 2.1% increase over the past ten days.

There is no put warrant available

The newly refreshed record high for the local index is happening against a backdrop of robust GDP growth, an AI-led electronics boom and a surprise MAS tightening that has reinforced confidence in the Singapore dollar and the broader economy, according to Bloomberg

✍Macquarie Research (MQ) published a research report yesterday stating their views on the MAS tightening and any potential impact that investors should note

➡Read more for the full article to find out MQ’s upgraded target price on the STI, as well as important disclaimers:

What’s new

The Monetary Authority of Singapore (MAS) surprised by announcing a second consecutive 'tightening' at its quarterly policy decision yesterday. MAS effects inflation management through FX targeting (SGNEER), noting Singapore's CPI is heavily influenced by imported goods inflation.

MAS noted strong growth and potential for inflation to be above the target band for reasons in its decision, points that are backed by recent data and developments. Yesterday's 'very slight' tightening move, MQ thinks, raises the slope by 25bps to +1.25% with a +/-2% tolerance band though MAS does not communicate the absolute target level:

Why it matters

​​​​​​​Due to the inverse relationship between FX appreciation and interest rates, all else equal, this move acts as a slight dampener on SG dollar short-end rates. Still, MQ notes the gap to US dollar is still too wide relative to the theory (Fig 2) and expect gradual normalisation from here driven by US dollar strength and eventual US Fed rate hikes (which would be in synch with the global growth and inflationary environment MAS described in its release).

The growth backdrop remains supportive, with the IT capex boom benefiting Singapore and global growth.

NODX, a key measure of domestic exports from Singapore, rose 20% last month, with MAS noting the positive output gap for the Singapore economy for 2026 could now widen.

MAS expects Core Inflation to step up in July and remain elevated into early next year. For 2026 as a whole, MAS expects both Core Inflation and CPI-All Items inflation to average 1.5–2.5%.

What now

MQ has a 6,000 12-month Straits Times Index target. For the market, MQ likes a broad mix of banks, non-bank financials, alongside select real-estate and industrial exposures.

Note:

Macquarie Research is independent from the Warrants business, what the Macquarie Warrants desks quote from Macquarie Research may not reflect the complete analysis of Macquarie Research on the relevant company over time.

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Macquarie first introduced a call warrant tracking the popular Amova STI ETF on 17 July 2026.

Since then, the warrant has risen 15.8% from SGD 0.076 to yesterday’s closing of SGD 0.088, 7.5 times more than the ETF’s 2.1% increase to SGD 5.735. The warrant can be traded on your brokerage account, just like shares, and come with no margin call risk.

However, one should note that a warrant’s geared effect is a double-edged sword, causing the warrants to fall in greater magnitude than the shares should your view be wrong.

There is no put warrant available over the Amova STI ETF.

For further warrant queries, you can ring us at 6601 0289 or drop us an email at info@warrants.com.sg