Without a doubt, Singapore is beginning to feel the effects of the global slowdown. The government’s recent advance 2Q GDP estimate revealed the local economy shrinking 6.6% from 1Q on a seasonally-adjusted annualised basis.

Unsurprisingly, a key reason for the contraction was the faltering economy in the US, one of our nation’s major trading partners. Meanwhile, headlines from across the Pacific were equally grim. During the past fortnight, a US bank was taken over by the government, while two mortgage issuers nearly went under.

IndyMac Bancorp, a mortgage bank based in California, came under federal supervision, after a run on the bank by panic-stricken depositors brought the venerable institution to its knees. IndyMac’s problems arose because the company specialises in issuing alt-a-loans – mortgages to borrowers with minor credit problems. Defaults surged during the year, casting doubt on the bank’s survival.

Fannie Mae and Freddie Mac, the two largest mortgage finance companies in the US also came under selling pressure as bankruptcy fears mounted. Fortunately for investors, the US government came to the rescue, propping up the ailing companies with fresh lines of credit.

Clearly, we have reached the stage where the US housing problem is no longer confined to the sub-prime level, as increasing foreclosures and defaults are spreading to the healthier segments of the housing market. It may take quite a while for the dust to settle and global financial sector to rebound.

To help readers navigate the waters amidst all uncertainties, we are pleased to collaborate with FactSet Reseach Institute to introduce a brand new ‘Research’ feature in our publication. Comprising the total number of Buy, Sell and Hold calls from major brokerages, average target price for each call as well as forecasted EPS figures, the new component should give investors a broader view of the underlying consensus for the more prominent counters.

Also noteworthy is the fact that a new index, the FTSE ST China Top Index, was launched on 7 July. Tracking 20 of the largest SGX-listed China stocks, this new index could not have come at a more appropriate time, with the Chinese counters currently trading at rock bottom valuations.