Daily Morning Note – 18 June 2018


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Phillip Macro Observation – 5 key points from June FOMC Meeting
Analyst: Pei Sai Teng
– Fed target rate increased by 25bps to 1.75% – 2.00%
– Dot plot shows additional hike this year
– Economic is doing well with inflation near target
– Change of tone in FOMC statement
– More frequent press conference starting next year


US stocks ended lower on Friday following US President Donald Trump’s remarks on the tariff measures on Chinese goods. In a tit-for-tat, China announced tariffs on US goods, including agricultural produce, cars US President Donald Trump announced 25% tariffs on tens of billions in Chinese imports. The Dow Jones industrial average closed 0.34% lower at 25,090.48, the S&P 500 fell 0.1% to 2,779.66, and the Nasdaq composite slipped 0.19% to 7,746.38.and seafood.

The European Central Bank will end its bond-buying programme by the end of the year, but it has also pledged to keep rates low possibly until after summer 2019. That has cheered bond and stock markets no end, but less so the euro. However, European shares sank on Friday as the tariff dispute between the United States and China escalated, triggering a sharp selloff in trade-sensitive commodities stocks. The pan-European Euro Stoxx 600 closed down by 0.99%.

Britain’s economy looks on track to grow at its weakest rate since 2009 this year due to Brexit uncertainties, higher oil prices and fears of a trade war. The British Chambers of Commerce cut its 2018 growth forecast to 1.3% from 1.4% and its outlook for 2019 to 1.4%.

The Bank of Japan left its monetary easing policy unchanged. It continue guiding 10-year Japanese government bond yields to be around zero and maintaining the quantitative easing measure for purchasing JGBs at “an annual pace of increase in the amount outstanding of its JGB holdings of about 80trn yen.”

Grab has secured a S$500mn five-year asset-backed syndicated facility from HSBC Singapore to finance the growth of its vehicle fleet.

Singapore Exchange was granted a licence extension by a court-appointed arbitrator to continue the listing and trading of SGX Nifty contracts beyond the previous August deadline.

Ho Bee Land has completed its acquisition of Frasia Properties S.à.r.l for £650mn (c.S$1.16bn) in London.

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

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