Daily Morning Note – 15 June 2020

PHILLIP SUMMARY

Stock futures fell in overnight trading on Sunday (Eastern Time), pointing to more losses ahead, as investors grapple with signs of a second wave of coronavirus cases amid the reopening economy.

Futures on the Dow Jones Industrial Average dropped about 350 points. The S&P 500 and Nasdaq 100 futures were also down 1.5% and 1.2%, respectively.

The overnight action in futures markets followed a big pullback last week triggered by rising fears of a resurgence in the virus as well as investors’ profit-taking after the massive comeback.

The Dow and S&P 500 lost 5.5% and 4.7% last week, respectively, while the Nasdaq shed 2.3%. All three major equity benchmarks suffered their worst week since March 20.

BREAKING NEWS

Australia will spend another A$1.5 billion (S$1.43 billion) on infrastructure and fast-track approval for projects including the expansion of BHP Group’s Olympic Dam in a bid to stimulate its ailing economy, Prime Minister Scott Morrison will say on Monday.

State investigators in both California and Washington are examining Amazon‘s business practices, two newspapers reported, citing people familiar with the matter.

Oil production in Venezuela, the country with the world’s largest reserves of crude, has fallen to a 75-year low with US sanctions continuing to cripple the country’s exports.

OEL (Holdings) said on Sunday that it has completed the acquisition of a 51 per cent stake in Shanghai Longjian Hospital Management through the company’s wholly-owned subsidiary AJJ Health Care Management on June 11.

Low Keng Huat (Singapore) said in a regulatory filing on Sunday that it will be able to withstand short-term cash flow pressures due to the Covid-19 pandemic on the back of its liquidity and support from banks.

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

TECHNICAL PULSE

Technical Analysis: U.S Market – The market rally continues after sell-off in mid-week

Analyst: Chua Wei Ren

– The stock market began to slide on Tuesday after hitting key resistance level which we mention on our report on 1st June

– The largest decline occurred on Thursday when the Dow Jones Industrial Average fell below 26,000 psychological level.

– Price recovered slightly on Friday but key levels remain untested.

– Elliott wave analysis suggests that there will be a slight rebound before selling remerge.


Technical Analysis: Singapore Stocks – Stocks reversed at key resistance levels

Analyst: Chua Wei Ren

– The Singapore stock market reversed sharply on Tuesday 9th of June in-lieu of the strong sell-off in the U.S markets.

– Stocks rebounded strongly last Friday before the markets closed for the week.

– Technicals suggest that the market will be ranging for a short period.


>> Read more technical reports

RESEARCH REPORTS

Singapore REITs Monthly – Re-rating catalyst for the REITs
Recommendation: OVERWEIGHT (Maintained), Analyst: Natalie Ong

– FTSE S-REIT Index gained +8.2% MoM in May. Strongest gains observed from the diversified and commercial subsector (+c.10%) while weakest performance in the healthcare subsector (-10.9%).

– Sector yield spread of 634bps over the benchmark 10-year SGS (10YSGS) yield was at the +0.24 standard deviation (SD) level.

– SREITs may emerge stronger with more future-ready portfolios, resulting in a re-rating of the SREITs sector. Remain OVERWEIGHT on SREITs sector with sub-sector preferences in Office and Industrial portfolios.

– We revise our target prices for Singapore-focused REITs, ART, CMT, FCT, CCT, AREIT and KDC, incorporating a lower risk-free rate, as well as lower market-risk for the retail and commercial REITs.

>> Read more research reports

HK Reports – Read up on our Hong Kong reports here

RESEARCH VIDEOS

Webinar Of The Week

Market Outlook: (PSR) Dasin Retail Trust, Penguin International Limited, SingTel, SG Banking Monthly, SG Weekly, SGD Perpetual Bonds, Technicals

Date: 08 June 2020

For more on Market Outlook

Phillip Research in 3 minutes: #22- Singapore Banking Sector

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





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