Building for the future: What NDR 2026 means for the Singapore market

• NDR 2026 reinforces Singapore’s longer-term growth strategy, with infrastructure, technology and institutional resilience supporting the broader equity outlook.

• Multi-decade infrastructure plans across land development, power and defence strengthen the structural demand backdrop for selected industrial and construction names.

• Trade remains the key near-term risk, but the confirmed 12.5% US tariff appears contained, with semiconductors exempt and only around a third of exports to the US affected; Singapore is also actively engaging the US to manage further risks.

• A firmer macro foundation supports the equity outlook, with MAS’ stronger S$NEER slope helping to contain imported inflation, while MTI’s upgraded 2026 GDP growth forecast of 4.5–5.5% reflects stronger-than-expected growth momentum. We maintain our positive view on the Singapore market.

The National Day Rally 2026 opened with Prime Minister Wong describing a world that has changed — and continues to change rapidly. Conflict risks are rising, while trade is increasingly shaped not just by economics but by security considerations, from tariffs to greater scrutiny of supply chains. Rather than a temporary disruption, these shifts point to a more fragmented global environment that Singapore may need to navigate for years to come.

Singapore’s response is to remain open — deepening its global and regional connections while competing on the strength of its institutions. As openness and predictability become increasingly scarce, a jurisdiction that upholds the rule of law and honours its commitments could become relatively more valuable. This also helps explain Singapore’s continued ability to attract capital and wealth amid the heightened geopolitical uncertainties since the start of the year.

For investors, the significance of the Rally extends beyond the headline household measures. The more relevant signals lie in the policy directions that could shape the operating environment for locally listed companies, as well as what the Rally reaffirms about Singapore’s underlying macroeconomic resilience.

A multi-decade infrastructure pipeline strengthens the construction outlook

One of the long-term themes is land development. Over the coming decades, plans include creating a new western island, reshaping Sentosa and Pulau Brani, developing Long Island, extending Pulau Tekong and studying undersea tunnels to connect the outer islands. These initiatives will be complemented by a second Jurong Island Road link and continued investment in housing and preschool infrastructure. Taken together, they point to a sizeable, multi-decade pipeline of infrastructure and construction activity.

The potential beneficiaries span individual project contractors to input suppliers whose demand is more closely tied to aggregate construction volumes. Companies with strong market positions and established track records in large public-sector projects could be better placed to capture this demand as projects progress. For example, Pan-United, the domestic ready-mix concrete and cement leader, and BRC Asia, the dominant reinforcement-steel player, are both positioned to benefit from a broader increase in construction activity.

While the projects will take years to translate into actual tenders and revenue, the scale and duration of the pipeline could provide greater visibility for Singapore’s construction ecosystem. This strengthens the longer-term earnings backdrop for selected construction-related names and adds another structural pillar to our positive view on the Singapore market.

Singapore's strategic priorities in energy security and defence create a supportive backdrop for large-cap industrials

The same island-building programme matters for a second reason that extends beyond construction volumes: the strategic priorities underpinning it. Beyond the physical build-out, the plans reaffirm national priorities around energy security and defence, which could support selected industrials that are well aligned with these long-term themes. While the eventual benefits to individual companies will depend on contract wins, project execution and earnings delivery, the policy direction nevertheless points to a potentially supportive longer-term demand backdrop for infrastructure-related names.

The first direction is power. PM Wong confirmed that a new island in the west will accommodate new power-generation infrastructure to meet Singapore’s future needs. As the country’s leading independent power producer, Sembcorp Industries is well positioned within this broader direction, while the plan also reinforces the longer-term energy-security theme highlighted in the speech.

The second is defence. The Rally placed greater emphasis on a more contested security environment, highlighting the growing use of grey-zone tactics, the potential threat from drones, and plans to expand SAF training space across the outer islands. A sustained national commitment to defence provides a supportive backdrop for companies like ST Engineering, the domestic defence prime and an STI heavyweight.

More broadly, sustained earnings growth among large-cap industrials could provide an incremental contribution to STI earnings, potentially supporting the market’s longer-term earnings growth.

Related article: Industrials cement their role as the STI's earnings growth engine

Trade risks remain, but Singapore’s external position provides some buffer

The Rally highlighted the external risks facing Singapore as trade becomes increasingly shaped by security considerations. The US has found new grounds to re-impose tariffs and raised concerns about goods being routed through Southeast Asia to circumvent duties. As a major re-export and transhipment hub, Singapore is exposed to any further tightening of trade measures, making this an important near-term risk for the economy. The recently confirmed 12.5% US tariff, however, does not appear to represent a broad-based shock, with semiconductors and certain electronics exempt and only around a third of Singapore’s domestic exports to the US estimated to be subject to the tariff.

Related article: Confirmed but contained: Singapore's 12.5% US tariff takes effect, thesis intact

Singapore’s response is to strengthen trade governance while maintaining engagement with key partners. PM Wong reiterated that Singapore enforces clear rules of origin, will act on credible evidence of wrongdoing, and will continue engaging the US to explain its position. While these measures cannot eliminate the risks from a more fragmented trading environment, they could help mitigate the impact and preserve Singapore’s position as an open, rules-based economy.

A firmer macro foundation supports our positive view

Pulling these threads together, the Rally reinforces our constructive view of Singapore, with the economy entering a more uncertain global environment from a relatively firm macro and policy position.

Monetary policy continues to provide some protection against imported inflation. The disruption to shipping through the Strait of Hormuz has pushed up energy prices, with imported inflation being the main channel through which higher energy costs feed into Singapore. MAS’ firmer S$NEER slope — its second consecutive tightening this year — can help contain these pressures through a stronger Singapore dollar. For the financial sector, continued capital inflows and a firmer rate environment could also provide a supportive backdrop for wealth management and bank earnings.

Singapore’s role in the global AI supply chain also remains supported at the policy level, with the Rally’s emphasis on technology and productivity growth reinforcing the country’s commitment to remaining relevant in the global value chain. This aligns with the ongoing AI infrastructure cycle, which has supported activity across Singapore’s semiconductor segments and contributed to stronger-than-expected economic growth.

Related article: MAS' July Tightening: A firmer policy signal, an unchanged investment case

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The combination of a firmer macro backdrop, continued investment in productivity and technology, and long-term infrastructure development provides multiple sources of earnings support, while Singapore’s institutional and policy framework offers some resilience against a more fragmented global environment.

For investors seeking diversified exposure to Singapore equities, we continue to recommend the Amova Singapore STI ETF (SGX: G3B) for broad market exposure, while the iFAST-Amova Singapore Equity A SGD offers greater exposure to small- and mid-cap opportunities beyond the STI's 30 blue-chip constituents.

Declaration

For specific disclosure, at the time of publication of this report, IFPL (via its connected and associated entities) and the analyst who produced this report hold a NIL position in the abovementioned securities.

This research report was prepared with the assistance of artificial intelligence (AI) tools. iFAST Financial Pte Ltd does not rely exclusively on AI for content generation; the content of this report, including all investment theses, ratings, price targets and conclusions, has been independently reviewed and verified by the research analyst(s) to ensure accuracy and professional integrity.