Daily Briefing: Reuters poll says sales tax will hike; Singapore spacetech sector to take flight

Daily Briefing: Reuters poll says sales tax will hike; Singapore spacetech sector to take flight

And here are three reasons to keep your stocks.

From Reuters:

Singapore, a city-state famed for the low-tax model that helped transform it from a gritty port town to an Asian Manhattan, is expected to put something unusual in this year’s government budget announcement: a tax hike.

Nine of 10 economists polled by Reuters think authorities on Monday will unveil the first rise in the goods and services tax (GST) since 2007. Policymakers have flagged the need to increase revenue to meet future social spending needs of a rapidly ageing population.

Economists say Finance Minister Heng Swee Keat might also make tweaks to taxes on e-commerce retailers such as Amazon.com. Inc, wealth and sugar when he presents the budget, at 0730 GMT on Monday, for the year starting April 1.

Read more here.

From Tech in Asia:

Government support is growing and foreign companies are also setting up shop in the island nation to take advantage of the impending groundswell.

As a new industry, however, it faces challenges. Talent can be hard to find, and cautious investors hesitate to back space startups because they take longer to build a functioning product compared to software companies.

But the opportunity seems to be there. Morgan Stanley values the global space industry at US$350b and predicts this figure will skyrocket US$1.1t by 2040.

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From The Motley Fool:

Even before this week, the average forward price-to-earnings (PE) ratio for stocks in the S&P 500 was 19 times. Add in the additional earnings of the tax reform and the market was trading at around 18 times its forward earnings. Looking back from 1990 to January of this year, the S&P 500’s average PE ratio is 23.85. This means that the market was already trading at a discount to historical averages.

Furthermore, many of the index components are seeing high earnings and revenue growth rate, which can justify their rich valuations. With this in mind, I do not think stocks are over-valued, especially so after the past week’s decline in the US stock market.

Read more here.

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