Singapore technology stock rout intensifies with $110b wipeout

Bloomberg

Investors betting on Singapore’s two largest internet companies are staring down hefty losses as rising interest rates and recession risks extended a tech rout that wiped out $110 billion from their market capitalisation.
E-commerce platform operator Sea Ltd plunged 78% this year while ride-hailing firm Grab Holdings Ltd has more than halved. The two companies, both listed in New York, are the largest tech firms in Singapore by market value.
They were added to the MSCI Singapore Index with much fanfare the past two years when there was still appetite for tech stocks in the region. But higher interest rates and a slowing economy could spell another challenging year ahead as investors question their ability to turn a profit. The MSCI Singapore gauge has lagged the Straits Times Index — which doesn’t count Grab and Sea as its members — by about 20 percentage points this year.
The MSCI Singapore Index is down 14% this year, with Sea holding the fourth-largest weighting at 8.4% and Grab at about 2%. In contrast, the Straits Times Index — dominated by old-economy sectors such as banks and property — is up about 5%.
The outlook for the Singapore-based tech companies remains dim as worries about a recession have triggered layoffs, closures of business units and other measures to rein in expenses across the tech industry. Still, the “recent cost cutting measures should help both companies weather any storms better,” Freitas said.