Daily Morning Note – 10 November 2020
European shares jumped to an eight-month high on Monday after drug makers Pfizer and BioNTech flagged strong progress in their Covid-19 vaccine, while Joe Biden’s election victory raised hopes of a more stable US trade policy. Pfizer Inc and BioNTechSE said the experimental vaccine was more than 90 percent effective in preventing Covid-19, based on initial data from a large study. The pan-European Stoxx 600 jumped nearly 4 percent and clocked its best day since late March. Travel and leisure stocks, which have been the hardest hit by the pandemic, were among the best performing sectors, adding 7 percent to hit an eight-month high.
US shares revved higher on Monday on the news a coronavirus vaccine had shown 90 percent effectiveness, but after blasting through records early in the session, Wall Street closed with more modest gains. The bellwether Dow Jones Industrial Average jumped over 830 points or 2.95 percent to finish the day at 29,157.97, while the broader S&P 500 rose 1.1 percent to 3,550.5, about 30 points shy of a record.
But the tech-heavy Nasdaq reversed early gains and slipped 0.7 percent to close at 11,713.78, as firms that benefitted from the pandemic lost ground, including Zoom and Netflix.
President Donald Trump, who is refusing to concede election defeat, injected new volatility on Monday by firing his defence secretary, while President-elect Joe Biden made good on a promise to focus on leading the country out of the Covid-19 crisis.
Vicom posted a 5 percent slip in its profit after tax and minority interest (Patmi) for the third quarter ended Sept 30, from S$7.15 million a year ago to S$6.82 million. Revenue for the vehicle-inspection firm, a subsidiary of transport operator ComfortDelGro Corp, fell by 16 percent year-on-year (y-o-y), from S$26.4 million to S$22.2 million for the quarter.
Elite Commercial Reit on Monday posted a distribution per unit (DPU) of 1.23 pence (S$0.02) for its third quarter, which is 1.7 percent higher than what it had forecast in its listing prospectus. For the three months ended Sept 30, it generated a post-tax profit of £3.3 million, a 5.6 percent drop from its forecast, on the back of a revenue of £5.8 million, which was a 0.5 percent dip from its earlier expectations.
Malaysia glove maker Riverstone Holdings on Monday announced that its net profit had grown five times to RM178.6 million (S$58.2 million) for its third quarter ended Sept 30, unhampered by rising packaging and raw material costs. Revenue rose 92 percent to RM482.3 million, due to the surge in global demand for personal protection equipment amid the Covid-19 pandemic, which led to higher average selling prices of the group’s healthcare examination gloves since June this year.
Neo Group’s first-half attributable net profit grew more than five times to S$13.6 million for the period ended Sept 30, up from S$2.3 million a year ago. This was due to higher other income contributed by higher financial grants from the government, revenue growth from its core catering and manufacturing businesses, as well as an overall reduction in operating expenses including delivery, employee benefits, and advertising.
Offshore oil and gas contractor Dyna-Mac on Monday said it has secured fabrication projects for a total provisional sum of S$157.5 million. These contracts are for the fabrication of pipe spools and construction of topside modules for floating production storage offloading vessels, it said. The projects begin in the fourth quarter of this year and are expected to be completed by the second quarter of next year.
Sunningdale Tech’s chairman Koh Boon Hwee is teaming up with Novo Tellus PE Fund 2 to make an offer for the precision plastic components manufacturer at S$1.55 in cash per share via a scheme of arrangement. This proposed acquisition was announced on Monday evening. Mr. Koh’s entity, Sunrise Technology Investment Holding II, and a subsidiary of Novo Tellus PE Fund 2 hold a 64 percent and 36 percent stake respectively in the offeror company.
Oil surged about 8 percent on Monday, its biggest daily gain in more than five months after Pfizer announced promising results for its Covid-19 vaccine. Brent crude settled at US$42.40 a barrel, up US$2.95, or 7.48 percent, while US West Texas Intermediate crude settled at US$40.29 a barrel, rising US$3.15, or 8.48 percent.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, PSR
Olam International Ltd
Analyst: Chua Wei Ren
Recommended Action: Technical BUY
Olam International (SGX: O32) continuous downtrend has been persisting but recent technical indicate a revival of the bulls.
CapitaLand Limited – Pick-up in all business segments
Recommendation: BUY (Maintained), TP: S$3.82
Last Done: S$2.64, Analyst: Natalie Ong
– Sustained recovery in all business segments in 3Q20.
– Remains committed to S$3bn divestment target and digitalisation to build stickiness and future-proof its portfolio, as well as cash conservation.
– Reiterate BUY and TP of S$3.82, at a 20% discount to RNAV. CAPL is our top pick in the sector.
HK Reports – Read up on our Hong Kong reports here
Webinar Of The Week
Date: 09 November 2020
Updates summarised in 3 minutes
|The information contained in this email and/or its attachment(s) is provided to you for information only and is not intended to or nor will it create/induce the creation of any binding legal relations. The information or opinions provided in this email do not constitute an investment advice, an offer or solicitation to subscribe for, purchase or sell the e investment product(s) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of this information. Investments are subject to investment risks including possible loss of the principal amount invested. The value of the product and the income from them may fall as well as rise. You may wish to seek advice from an independent financial adviser before making a commitment to purchase or investing in the investment product(s) mentioned herein. In the event that you choose not to do so, you should consider whether the investment product(s) mentioned herein is suitable for you. PhillipCapital and any of its members will not, in any event, be liable to you for any direct/indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials attached to this email. The information and/or materials provided 揳s is?without warranty of any kind, either express or implied. In particular, no warranty regarding accuracy or fitness for a purpose is given in connection with such information and materials.|
|This e-mail and its attachment(s) may contain privileged or confidential information, which is intended only for the use of the recipient(s) named above. If you have received this message in error, please notify the sender immediately and delete all copies of it. If you are not the intended recipient, you must not read, use, copy, store, disseminate and/or disclose to any person this email and any of its attachment(s). PhillipCapital and its members will not accept legal responsibility for the contents of this message. Thank you for your cooperation.|