Daily Morning Note – 18 Oct 2019



Asian stocks looked set for a cautious start Friday ahead of a slew of economic data coming from China. U.S. equities posted modest gains amid mostly positive earnings reports. Futures edged up in Tokyo, were lower in Australia and flat in Hong Kong.

The S&P 500 Index fluctuated for most of Thursday around the 3,000 level, as Morgan Stanley became the latest big bank to defy expectations for weak growth. Doubts over whether a Brexit deal can win approval whipsawed the pound, while treasuries edged lower and the dollar declined.

The focus Friday moves to the latest reading on the health of China’s economy with the release of third-quarter GDP, September industrial production and retail sales data. Elsewhere, oil turned positive hours after a U.S. government report showed large declines in fuel inventories, outweighing a bigger-than-expected crude build.


SINGAPORE Press Holdings (SPH) will cut 5 per cent of staff from its media group, it said on Thursday, as the company posted a 23.4 per cent decline in net profit for the full year ended Aug 31.

KEPPEL Corp’s third-quarter net profit fell 30 per cent to S$159 million from a restated S$227 million a year ago, led by the absence of gains from divestment of a commercial development in Beijing and higher net interest expense.

SINGAPORE regulators are poised to award four 5G telecom licences, two more than previously planned, as Minister for Communications and Information S Iswaran called for bids for the high-tech new spectrum on Thursday.

The leading American maker of electronic cigarettes, Juul Labs, announced on Thursday it is suspending sales of some flavoured vaping products in the United States, as the US government prepares a nationwide ban.

CapitaLand, Razer clinch first enterprise 5G grants by non-telcos.

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


SREITs Monthly – Monthly Tracker: October 2019

Recommendation: NEUTRAL (Maintained), Analyst: Natalie Ong

– FTSE S-REIT index return gained 1.3% MTD and 25.1% YTD. Strongest gains were from the Industrial sector (+3.7% MTD) and weakest showing at the Healthcare (-0.9% MTD).

– Performance in September: Best – Keppel DC REIT (+13.5%), Worst – MapleTree North Asia Trust (-7.5%)

– Sector yield spread compressed MoM to 245bps, -1.5 standard deviation (s.d.) over the benchmark 10-year SGS (10YSGS) yield.

– 3-month SOR fell 40bps to 1.57% at 16 October 2019 versus 1.75% last month. Elevated P/NAVs expected to persist in the lower interest rate environment.

– Remain NEUTRAL on S-REITs sector. Sub-sector preferences: Office and Hospitality.

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