Welcome to this week’s edition of top stock market highlights.
Changi Airport passenger traffic
For those who have been tracking Singapore’s visitor numbers, there is reason to rejoice.
Changi Airport Group (CAG) handled 67.7 million passengers last year, which made up 99.1% of the pre-pandemic level of visitors back in 2019.
This number was just shy of a full recovery but is a 14.8% year-on-year improvement from 2023’s 58.9 million passengers.
December 2024 was one of the busiest months for CAG since the beginning of the pandemic, with 6.41 million passengers passing through the airport.
It was also the first time that passenger numbers exceeded six million since December 2019.
366,000 flights took off or landed in Changi Airport in 2024, an 11.6% year-on-year increase from 328,000 in 2023.
China made up CAG’s largest market in 2024 by passenger traffic, taking the top spot after climbing from sixth place in 2023.
Indonesia fell from first place in 2023 to second place last year while Hong Kong entered the top 10 at number nine, displacing South Korea from the rankings.
Once again, the busiest route for CAG was to and from Kuala Lumpur (Malaysia), a record held for 2023 and 2019 as well.
Shanghai (China) popped up in the top 10 at number eight while Sydney (Australia) fell out of the rankings in 2024.
In terms of air freight, the airport handled 1.99 tonnes, up 14.6% year on year, because of major improvements in cargo flow between Singapore and China, and Singapore and the US.
CAG also added 11 new cities to its network last year, with Singapore now linked to 163 cities in 49 countries around the world.
By the mid-2030s when Terminal 5 is operational, the aim is to increase this number to more than 200 cities.
Transport Minister Chee Hong Tat is confident that CAG’s passenger traffic will continue to improve in 2025 and exceed pre-pandemic levels.
The companies that stand to benefit from higher passenger numbers and the increase in cargo handling are Singapore Airlines Limited (SGX: C6L) and SATS Ltd (SGX: S58).
Trump’s artificial intelligence investment plan
The artificial investment (AI) scene just received a jolt in the arm after President Trump announced a joint venture (JV) to fund AI infrastructure.
This JV, in partnership with the leaders of Softbank, Open AI, and Oracle Corporation (NYSE: ORCL), is aimed at speeding development of this nascent technology.
The JV will deploy US$100 billion initially with the goal of investing “at least” US$500 billion in AI projects such as data centres and physical campuses.
The trillion-dollar technology companies Microsoft (NASDAQ: MSFT) and Nvidia (NASDAQ: NVDA) are also expected to participate.
This new initiative is termed “Stargate” but investors are unsure if it will result in a significant uptick in AI spending.
Cloud infrastructure providers such as Microsoft, Amazon (NASDAQ: AMZN) and Oracle are racing to expand their computing capacity by building data centres.
Oracle, in particular, has committed to double its capital expenditure for 2025 to more than US$14 billion.
Singapore construction demand
For 2025, the total value of construction contracts is projected to range between S$47 billion and S$53 billion in nominal terms.
This compares well with 2024’s preliminary construction demand figure of S$44.2 billion put forth by the Building and Construction Authority (BCA).
This level also exceeded BCA’s mid-year forecast of between S$35 billion and S$41 billion.
The reason was attributed to more institutional projects along with a greater number of private and public housing projects.
On a real value basis, 2025’s demand should range between S$35 billion and S$39 billion, which is between 0.3% and 11.7% higher than the pre-pandemic level of 2019.
This strong demand is generated by the expected award of Changi Airport’s Terminal 5 and the expansion of the Marina Bay Sands integrated resort.
In addition, high-specification industrial buildings, healthcare facilities, and mechanical cum engineering contracts for rail lines should also contribute to this increased demand.
Between 2026 and 2029, BCA expects construction demand to hover between S$39 billion to S$46 billion per year.
With such strong demand, construction companies such as BBR Holdings (SGX: KJ5) and Ley Choon Group (SGX: Q0X) could see their fortunes improve.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
