Mood brightens for both services and manufacturing firms: Surveys

The services sector was the most upbeat about business prospects in over three years.
The services sector was the most upbeat about business prospects in over three years. PHOTO: ST FILE

SINGAPORE - Firms in the services sector saw a big pick-up in business sentiment while their counterparts in manufacturing grew more optimistic too, going by separate surveys released by the Department of Statistics (Singstat) and the Economic Development Board (EDB) on Tuesday (Oct 31).

The services sector was the most upbeat about business prospects in over three years. A net weighted balance of 9 per cent of firms expects more favourable business conditions in the October to March period - up from 5 per cent in the previous quarter's survey, when sentiments turned positive for the first time in seven quarters.

In the manufacturing sector, a net weighted balance of 5 per cent of companies expects business to improve over the same six-month period, up slightly from the 4 per cent who said felt so in the previous EDB survey.

All industries in the services sector were feeling optimistic with one exception - real estate firms. Firms engaged in the leasing of commercial space in particular expected weaker demand for their services.

But the year-end holiday period brought hopes of more business especially to firms in the food & beverage, retail and accommodation line.

Among manufacturing firms, those in precision engineering were the most optimistic, with a net weighted balance of 22 per cent anticipating improved business conditions ahead. This optimism was strongest among makers of semiconductor-related equipment, as well as measuring devices supporting the wireless communications and auto industries.

In the chemicals cluster, a net weighted balance of 17 per cent of firms see business improving. Those dealing in petroleum products expect winter and the year-end festive season to support the demand for oil products such as kerosene and naphtha. Additionally, the specialties and other chemicals segments anticipate higher export orders for mineral oil additives and fragrances respectively in the months ahead.

The general manufacturing industries and electronics clusters were the least optimistic, with a net eighted balance of 9 and 11 per cent of firms respectively expecting conditions to get tougher. The general manufacturing firms include construction firms hit by a slowdown in business domestically, while electronics firms anticipate business prospects to be seasonally softer over the next six months.

Biomedical manufacturing companies, meanwhile, are upbeat with a net weighted balance of 12 per cent saying business will improve, especially those anticipating demand for medical devices from the US and EU to remain strong.

In the transport engineering industry, a net weighted balance of 7 per cent  are more upbeat. The aerospace segment projects more aircraft engine repair orders, while the majority of firms in the marine & offshore engineering and land segments expect business conditions to stay the same.