The Straits Times Index (SGX: ^STI) has had a terrific run.

The SPDR STI ETF (SGX: ES3), which tracks the STI, returned 13.1% in the first half of 2026 (1H2026). 

And the banks have done most of the heavy lifting. 

In the first half of 2026 alone, OCBC Limited (SGX: O39) returned 28%, while DBS Group Holdings (SGX: D05) and UOB Limited (SGX: U11) returned at 19% and 15%, respectively.

This raises an uncomfortable question. 

If DBS, OCBC and UOB were to sell off hard, what would happen to the STI?

Would the index simply go down with them, or could the rest of the index cushion the blow?

Why Singapore Banks Matter So Much to the STI

The STI is market-capitalisation-weighted: bigger companies get a…