Review: After a sizzling 1Q21, the STI was back to its old penchant. The 1.1%
contraction in 2Q21 led to its underperformance against major asset classes (Figure 4). Our bullish expectations did not pan out. After touching a high of 3,237 at end- April, the index succumbed to tighter social-gathering measures announced on 4 May. Restrictions were further tightened on 18 May, under Phase 2HA. Unlike the circuit breaker, the impact was narrowed to the entertainment, retail and service sectors as social interactions were limited to two and work-from-home again became the default. Sentiment nosedived on fears over another infection wave. During the quarter, a handful of mid-cap sectors did rally. Property agencies jumped as much as 58% on the back of a resilient residential property market. Malaysia-based iron-ore producers skyrocketed 65% as iron-ore prices spiked 40%.