Daily Morning Note – 13 Aug 2019


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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.


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


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

Market Outlook: : (PSR) Raffles Medical Group, Singapore Exchange Limited, DBS Group Holdings, Oversea-Chinese Banking Corp Limited, United Overseas Bank Limited, Ascendas REIT, Ascott Residence Trust, Sheng Shiong Group & Phillip Singapore Weekly

Date: 05 August 2019

For more on Market Outlook

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