Stock picks for investors seeking shelter from Brexit: UOB

SINGAPORE (June 27): UOB is recommending investors seek shelter in dividend-yielding stocks such as Singtel, ST Engineering, SPH, SATS, REITs and plantation companies on the back of continuing market volatility in the aftermath of Brexit, according to a report issued on Monday.

Within the REIT space, UOB recommends investors seek refuge in defensive REITs that have no exposure to Europe. These include Parkway Life REIT, Frasers CT and Mapletree Industrial Trust, with target prices of $2.38, $2.15 and $1.61 respectively.

Even for REITs with significant exposure to the UK and EU such as City Developments, Frasers Hospitality Trust and Ascott Residence Trust, the impact on balance sheet is minimal for most companies due to their natural hedge. The research house forecasts a 0.5-2.9% negative impact on earnings if the pound depreciates by 10%.

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