Daily Morning Note – 13 Aug 2019
WEEKLY MARKET OUTLOOK WEBINAR
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PHILLIP SUMMARY
TheS&P 500 was off 1.23%. The Dow Jones industrials fell 1.48%, and the Nasdaq Composite had given up 1.20%. The Nasdaq 100 index, reflecting Big Tech, dropped 1.1%. The Dow was off as many as 462 points before late-day bargain hunting kicked in.
The major averages have fallen about 5% from the peaks in late July. Long-term bond yields tumbled, with the spread between the 10-year and 2-year Treasury falling to as little as six basis points. The spread was the lowest since 2007. The 10-year yield fell to about 1.64%, the lowest level since October 2016.
Hong Kong’s airport reopened early Tuesday after thousands of protesters staged a mass demonstration that led to the cancellation of hundreds of flights. Investors and business leaders are growing increasingly alarmed by the fallout from 10 weeks of anti-government demonstrations that show no sign of letting up.
BREAKING NEWS
Singapore slashes economic growth forecast to 0-1% for 2019.
HRnetGroup on Tuesday posted a 11.5 per cent fall in net profit to S$11.5 million for the second quarter, from S$13 million a year ago on the back of lower margins from flexible staffing. Gross profits were slightly lower mainly due to the inclusion of government contracts which carry lower margins, the mainboard-listed recruitment firm said.
GS Holdings on Monday reported a net profit of S$5.49 million for its financial year’s first six months ended June 30, reversing from a S$1.24 million loss for the year-ago period.
Mainboard-listed consumer electronics part maker CDW Holding warned on Monday that it is likely to report a consolidated operating loss for the first six months of its financial year ended June 30, 2019.
Wall Street stocks finished a bruising session sharply lower Monday as worries about slowing growth and the protracted US-China trade war hit banking shares and the broader market.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, PSR
RESEARCH REPORTS
Singtel Limited – Short-term pain from Bharti
Recommendation: ACCUMULATE (Maintained), Last Done: S$3.26
Target Price: S$3.45, Analyst: Alvin Chia
– Revenue and net profit disappointed by 7% and 28% respectively. Airtel widened S$21mn in losses to S$119mn this quarter due to investments in its network
– The enterprise segment suffered pricing pressure from contract renewals and erosion in core carriage services.
– We saw robust revenue growth from cybersecurity and digital. There were positive mobile price revisions in Optus.
– Maintain ACCUMULATE with a lower TP of S$3.45 (prev. S$3.66).
China Aviation (Singapore) Oil – Perform as expected
Recommendation: BUY (Maintained), Last Closing Price: S$1.18
Target Price: S$1.52, Analyst: Chen Guangzhi
– Maintain ACCUMULATE with a lower TP of S$3.45 (prev. S$3.66).
– 2Q19 revenue and net profit met our expectations
– Healthy volumes in trading business and Pudong airport
– Jump in the provision due to higher counterparty risks
Webinar Of The Week
Date: 05 August 2019
Clients of Phillip Securities can keep updated with Country Strategy and Singapore Sector Reports by logging into: www.poems.com.sg > STOCKS > Research
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