Just when investors are heaving a collective sigh of relief over the defeat of Ms Marie Le Pen in the French presidential election earlier this month, political troubles brewing in Washington are putting them back on tenterhooks.
Beset by allegations of improper links to Russia and obstruction of justice, United States President Donald Trump has been forced to put his expansionary economic agenda on the back burner.
Threats of an impeachment, although remote, have caused jitters in the currency market, with the greenback dropping to about 1.386 against the Singapore dollar over the past week, a fresh low for the year.
Stock market reactions, however, were more measured. For the week, the Dow Jones Industrial Average was down by only 0.4 per cent.
At home, the benchmark Straits Times Index (STI) shed 1.18 per cent to reach 3,216.92 points.
This in itself is not a worry, with analysts such as IG market strategist Pan Jingyi seeing a solid support level at around 3,200 for the STI.
The resilience of the global economic recovery is keeping markets on an even keel, they noted.
In the US, initial jobless claims for the week ended May 13 dropped to levels last seen in 1973. The good news helped slash the Dow's weekly loss.
Meanwhile, Singapore is expected to report first-quarter economic growth of 2.7 per cent on Friday, according to a Moody's forecast. The official advance estimate is for 2.5 per cent growth.
Industrial production for last month - the data is also due out on Friday - is likely to have expanded 8 per cent, added Moody's.
"Services will continue to be the main positive for the city-state's economy, benefiting from stronger global economic conditions and improving domestic consumption. Manufacturing also has received a boost from external demand," it said in a note last week.
Little wonder then that manufacturers put in an encouraging performance in the first quarter, based on CIMB's tracking of small caps. The January-March reporting season saw seven beating the bank's profit estimates while six were in line, said CIMB analyst William Tng.
Among the outperformers were precision engineering firm AEM Holdings, automotive components support provider Memtech International, cleanroom product manufacturer Riverstone Holdings and precision assembly company Sunningdale Tech.
Mr Tng gave these firms a buy rating because of a robust earnings outlook and improving margins. AEM, for instance, has the advantage of being the sole supplier to a major client. "We believe compound annual growth for its earnings per share over financial years (FY) 2017-19 could hit 74.8 per cent. For the remainder of FY 2017, AEM forecasts a pre-tax profit amounting to at least $17.5 million," noted Mr Tng.
Meanwhile, Memtech's dividend yields are projected to come in at 4.5 per cent to 5.5 per cent over this year and the next. Mr Tng said: "We believe Memtech will enjoy margin expansion, given volume growth."
AEM last closed at $2.60, with a price-to-earnings ratio of around 20 times. Memtech last traded at 80 cents, with a ratio of around 11.
