Top Stock Market Highlights of the Week: ComfortDelGro Corporation, iFAST and China’s Bank Reserve Ratio

Welcome to this week’s edition of top stock market highlights.

ComfortDelGro Corporation Ltd (SGX: C52)

ComfortDelGro, or CDG, through its joint venture with Go-Ahead Group, Connecting Stockholm, of which it owns a 45%-stake, was awarded a contract by the Stockholm Public Transport Administration, Trafikförvaltningen, to operate and maintain the Stockholm Metro.

This contract marks the land transport group’s first rail contract in Sweden and will become its largest rail passenger operation outside of Singapore.

Operations are slated to commence in May 2025 and the contract will last for 11 years.

Connecting Stockholm will operate and maintain all of Stockholm Metro’s seven lines which include 100 stations, six depots, and 107 kilometres of track.

As the appointed rail operator, CDG is responsible for customer service, the planning and delivery of rail services, and equipment and facility maintenance.

The contract is also structured to account for the potential development and expansion of Stockholm Metro in the future.

This latest contract win adds to CDG’s growing international rail footprint which includes operations in both New Zealand and France.

With this contract, the total length of track operated by the group is over 310 kilometres.

iFAST Corporation Limited (SGX: AIY)

iFAST has announced that its Malaysian subsidiary, Bondsupermart Sdn Bhd, has obtained in-principle approval from the Securities Commission of Malaysia to operate a bond marketplace under the Regulated Market Operator Framework.

The bond marketplace, to be named “Bondsupermart”, has the goal of becoming a centralised and easily accessible marketplace for the buying and selling of bonds.

CEO Lim Chung Chun commented that bond trading still operates predominantly over-the-counter and the bond market has seen limited innovation compared to other asset classes.

In particular, there are currently few to no bond exchanges for individual investors to engage in bond trading.

Because of this, bond investors cannot enjoy price transparency and are also subject to trading inefficiencies when they transact in bonds.

Bondsupermart aims to create a global marketplace for everyone to participate in both the Malaysian Ringgit and global bond market, opening up an avenue for investors to transact bonds similar to how stocks are bought and sold on an organised exchange.

The new Bondsupermart platform will allow individual investors to not just transact but establish market-driven and fair market values for bonds based on supply and demand.

iFAST’s existing Malaysian bond trading volume is approximately RM 800 million per month and this platform will allow Bondsupermart Malaysia to attract, grow and expand when it on-boards more participants.

Bond trading services are slated to be launched in the second half of this year.

China’s bank reserve ratio

China plans to cut the reserve requirement ratio (RRR) for banks early next month in a bid to release more money to boost its economy.

This goal was communicated by the People’s Bank of China Governor Pan Gongsheng.

The 0.5 percentage point cut will provide RMB 1 trillion (around S$188.9 billion) of long-term liquidity to the market.

The announcement of this cut is unusual in that it was revealed in a press conference rather than being announced by China’s central bank.

However, it could be because sentiment remains poor and both Chinese and Hong Kong stocks have collectively lost more than US$6 trillion in market value since the peak in 2021.

Reducing the RRR releases liquidity that banks can use to make more loans or purchase bonds to spur economic growth.

The central bank cut the RRR twice last year.

Should this move work, it could boost confidence and limit the damage to stock markets by the pervasive pessimism.

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Disclosure: Royston Yang owns shares of iFAST Corporation Limited.

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