Daily Morning Note – 15 July 2021

PHILLIP SUMMARY

Asian stocks look set for a steady start Thursday after Federal Reserve Chair Jerome Powell signalled more U.S. economic progress is needed before stimulus can be pared back and as traders await China growth data. Futures inched lower in Japan and Australia and were steady in Hong Kong. U.S. contracts fluctuated following modest S&P 500 and Nasdaq 100 gains on Powell’s reassurance on accommodative policy and reiteration that high inflation will likely moderate in coming months. Treasuries rallied and the dollar held a retreat. A raft of key Chinese reports are due later, including gross domestic product growth, amid a debate on whether the Asian nation’s economic rebound from the pandemic is peaking. An upcoming maturity of policy loans will offer clues on how far China’s central bank will go in loosening policy.


BREAKING NEWS

SG News

Fortress Minerals saw record revenue of US$17.3 million for the first quarter ended May 31, nearly one-and-a-half times the US$7.1 million figure for the year-ago period. Net profit more than tripled to US$7.2 million, up from US$2.2 million in the year-ago period. The Malaysian producer and exporter of iron ore concentrate attributed its results to increased sales volume and strong iron ore prices.

Catalist-listed specialist engineering services provider Acromec has entered into a joint venture (JV) with Tako Ventures to launch co-working laboratory spaces, the group said on Wednesday in a bourse filing. The group said its wholly-owned subsidiary Acromec Engineers has entered into agreements with Tako Ventures to formalise a JV and implement it through a JV company called Life Science Incubator.

Ezion Holdings is divesting two towing tugs along with its entire stake in its wholly-owned subsidiary Teras Sunrise for a total of US$83.7 million to ZhongXie Industrial, a marine logistic services provider based in Hong Kong. According to an exchange filing late on Tuesday night, the offshore and marine player signed a share purchase agreement to sell Teras Sunrise for US$80.2 million. This is expected to result in a US$13.1 million gain on disposal.

Yongnam Holdings gave notice of three consecutive years of losses in a regulatory filing on Wednesday, while its independent auditor also noted material uncertainty over the steel fabricator’s ability to continue as a going concern. As at July 14, Yongnam’s latest six-month average daily market capitalisation was S$43.3 million.

Sembcorp Floating Solar Singapore, a wholly-owned subsidiary of Sembcorp Industries, and Singapore’s national water agency PUB on Wednesday announced the official opening of the Sembcorp Tengeh Floating Solar Farm at the Tengeh Reservoir. With this, Singapore is one of the few countries in the world to have a waterworks system that is fully solar-powered. The farm will also contribute to Singapore’s goal of quadrupling solar energy deployment by 2025.


US News

Even as US inflation has hit the highest rate in over a decade, the central bank is sticking to its guns, and will continue to provide stimulus until the economy has fully recovered, Federal Reserve Chair Jerome Powell said Wednesday. Mr Powell acknowledged that the inflation spike was stronger than the Fed was hoping to see, and will remain “elevated” in coming months, but he again expressed confidence the rate will decline once supply bottlenecks and other temporary issues are resolved.

Apple has asked suppliers to build as many as 90 million next-generation iPhones this year, a sharp increase from its 2020 iPhone shipments, according to people with knowledge of the matter. Its shares jumped to a record. The Cupertino, California-based tech giant has maintained a consistent level in recent years of roughly 75 million units for the initial run from a device’s launch through the end of the year.

Microsoft on Wednesday said it will offer its Windows operating system as a cloud-based service, aiming to make it easier to access business apps that need Windows from a broader range of devices. Windows 365, as the service will be called, will roll out on Aug 2 and will work somewhat like buying a new Windows PC: A business or school will pick how much computing power, memory and storage they would like for an the new machine.

Twitter saw a surge in demands over the course of last year from governments around the world to take down content posted by journalists and news outlets, data to be released by the social media platform for the first time will show. In its transparency report to be published on Wednesday and a copy of which was seen by Reuters, Twitter said verified accounts of 199 journalists and news outlets on its platform globally were subject to 361 legal demands from governments to remove content in the second half of 2020, an increase of 26 per cent from the first half of the year.

American International Group Inc plans to use an IPO to sell part of its life and retirement business, while Blackstone Group Inc agreed to buy a sizeable stake, according to a person familiar with the matter. AIG and Blackstone said on Wednesday the private equity firm would pay US$2.2 billion in cash for 9.9 per cent of the unit, sending the insurer’s shares more than 6 per cent higher in after-market trading.

Citigroup comfortably beat market estimates for second-quarter profit on Wednesday, as the economic recovery allowed the bank to release loan loss reserves and offset a plunge in revenue from lower trading and credit card lending. For the quarter ended June 30, net income jumped to US$6.19 billion, or US$2.85 per share, from US$1.06 billion, or 38 US cents per share, a year earlier. Analysts on average had expected a profit of US$1.96 per share, according to Refinitiv IBES data.

The US Consumer Product Safety Commission (CPSC) said on Wednesday it has sued Amazon.com Inc to force the retailer to recall hundreds of thousands of hazardous products that it had distributed on its platform. By a 3-1 vote, the CPSC voted to file an administrative complaint saying the Seattle-based e-commerce giant was legally responsible to recall the products as they posed a serious risk of injury or death to consumers.

EBay has agreed to sell part of its stake in Norway’s Adevinta to private equity firm Permira for US$2.25 billion in cash, clearing the way for a tie-up between eBay and Adevinta’s classified ads businesses. The deal comes after Austria’s Federal Competition Authority demanded eBay cut its holding in Adevinta to no more than 33 per cent to approve their plan to create a world leader in classified ads.


Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, CNBC, PSR

TECHNICAL PULSE

City Developments Ltd

Analyst: Chua Wei Ren

Recommended Action: Technical SELL

City Development Ltd (SGX: C09) has been consolidating as a large range bound move since prices fails to make a new high in April 2021. Furthermore, technical price action indicate that the stock is heading for further downside correction to test the lower boundary of the range

Sell spot: 6.90 Stop loss: 7.10 Take profit: 6.20

>> Read more technical reports

HK Reports – Read up on our Hong Kong reports here

Webinar Of The Week

Weekly Market Outlook: Keppel, DBS, CapitaLand, Fraser, Asian PayTV, Comfort DelGro, LHN, Pan-United

Date: 12 July 2021

For more on Market Outlook

Updates summarised in 3 minutes

The Highlights EP01: LHN Limited – Optimisier of real-estate trends

For more videos on Phillip in 3 Mins

Read the research report(s), available through the link(s) above, for complete information including important disclosures Important Information





Disclaimer
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.
Confidentiality Note
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.

 

Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you

IMPORTANT INFORMATION

This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <www.phillipfunds.com> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  

 

Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066 www.phillipfunds.com