Daily Morning Note – 18 October 2021


Asia stocks are poised to start the week higher as investors weigh solid corporate earnings against concerns about inflation and the economic recovery.

Futures rose in Japan and Hong Kong. Australia ticked higher at the open, while U.S. contracts fluctuated. Wall Street stocks advanced on Friday, with the S&P 500 chalking its best week since July as earnings buoyed sentiment.

Bond yields in New Zealand and the kiwi dollar gained after New Zealand’s inflation accelerated to the fastest pace in 10 years. Yields on Australia’s three-year bond surged more than 10 basis points. Treasury yields climbed on Friday. The dollar was steady.

China’s third-quarter gross domestic product due Monday along with monthly industrial and investment data will be closely watched to gauge the severity of electricity shortages. Meanwhile, People’s Bank of China Governor Yi Gang said authorities can contain risks posed to the Chinese economy and financial system from the struggles of China Evergrande Group.



Offshore marine services contractor Kim Heng will fork out about S$10 million to purchase a crawler crane, which will be deployed for a windfarm project in Vietnam under its latest contract win. This comes as the company is diversifying into the renewable energy support sector. The crane will be used to lift and install wind turbines, and enable the group to offer turnkey lifting and installation works for onshore and offshore renewable windfarm projects in Taiwan and Vietnam. About S$7.5 million of the crane’s price tag will be funded with a green loan from UOB, and the balance will come from the group’s internal resources. Meanwhile, its wholly-owned subsidiary Kim Heng Heavy Equipment will undertake a US$7.2 million project for a main contractor of Vietnam windfarm projects. The contract includes engineering, lifting, technical and maintenance services. The new crane will be assembled at the worksite, which is intended to be at a South Vietnam onshore windfarm.

Precision medicine firm Clearbridge Health is looking to enter the business of investing in and divesting healthcare companies. It intends to seek shareholders’ approval at an extraordinary general meeting to be convened. The proposed new business will involve investments and injections of funds into entities in the global healthcare sector which are either Ebitda (earnings before interest, taxes, depreciation and amortisation) positive or “at an inflection point with a clear line of sight to profitability”, Clearbridge said. Such portfolio companies may include medical technology (medtech) companies and pharmaceutical companies. In a filing on Friday (Oct 15) night, Clearbridge said the “carefully deliberated investments” may take the form of equity, debt, a hybrid of both, or otherwise.

Drama and film production firm GHY Culture & Media will not be proceeding with its planned strategic investment in the Clover Films group, as their memorandum of understanding (MOU) has expired. If completed, the deal would have resulted in GHY holding a 51 per cent stake in each of the 3 Clover Films entities, while the existing shareholders would have retained the remaining 49 per cent. GHY had not signed any definitive documents with the existing shareholders as at Friday (Oct 15), and the exclusivity period under the MOU had expired on Sep 15. Despite the lapse of the MOU, the mainboard-listed company said it will continue to explore other collaboration opportunities with Clover Films. GHY also said it will identify other suitable opportunities to strengthen its presence in Singapore and South-east Asia. The group added that it “remains well-placed with its industry expertise to further grow across the business value chain”, supported by a positive net cash position and working capital.

The trustee-manager of Ascendas India Trust has appointed Cheah Ying Soon as its chief financial officer (CFO), starting Nov 1. The 44-year-old has been a senior director at CapitaLand Investment since August 2018, said the trustee-manager’s regulatory filing on Friday (Oct 15) evening. He will replace current CFO Tan Choon Siang, who has held the post since 2017. In another filing, Ascendas Property Fund Trustee said that Tan, 45, will assume another management position within the CapitaLand Investment Limited Group.


Shares in space tourism company Virgin Galactic tumbled on the New York Stock Exchange on Oct 15 after announcing the postponement of its first commercial flight, originally scheduled for the third quarter of 2022. In electronic trading before Wall Street opened, Virgin Galactic shares were down by more than 20 per cent. In a statement on Thursday, the company had said that an upgrade programme for its VMS Eve and VSS Unity spacecraft, aimed at strengthening the safety of the devices, would begin a month late. A recent laboratory test revealed “a possible reduction in the strength margins of certain materials used to modify specific joints, and this requires further physical inspection”, Virgin Galactic said, but have “no impact” on its space vehicles. As a result, the company’s first commercial flight is now scheduled for the fourth quarter of next year.

Goldman Sachs reported a jump in third-quarter profits on Friday behind robust gains in its financial advisory and trading divisions, capping a strong week of results for large US banks. The big New York investment bank reported profits of US$5.3 billion, up 63 per cent on a 26 per cent increase in revenues to US$13.6 billion. Key drivers for Goldman during the quarter included a jump in revenues tied to completed mergers and acquisitions, initial public offerings and capital-raising efforts by private companies. Goldman also turned in a strong performance in its global markets division, driven by higher revenues in equity trading.

Oil prices settled at a three-year high above US$85 a barrel on Friday, boosted by forecasts of a supply deficit in the next few months as the easing of coronavirus-related travel restrictions spurs demand. Brent crude futures settled up 86 cents, or 1 per cent, at US$84.86 a barrel. Front-month prices, which touched their highest level since October 2018 at US$85.10, hit a weekly rise of 3 per cent, its sixth straight weekly gain. US West Texas Intermediate (WTI) crude futures rose 97 cents, or 1.2 per cent, to US$82.28 a barrel. The was up 3.5 per cent on the week in an eighth consecutive weekly rise. Demand has picked up with the recovery from the Covid-19 pandemic, with a further boost from power generators who have been turning away from expensive gas and coal to fuel oil and diesel.

JPMorgan Chase and Citigroup were among lenders paid back when Vonovia made a surprise loan to the biggest shareholder of embattled German landlord Adler Group a week ago. The banks, together with Banco Santander, received repayment on their portion of an about 200 million euro (S$312.8 million) margin loan to Aggregate Holdings, according to people familiar with the matter, who asked not to be identified because the matter is private. The deal Vonovia struck has spared the international banks some of the turmoil facing Adler as it tries to fend off a short seller attack that has hammered its shares. Global lenders are keeping a close watch on Adler’s efforts to sell assets and cut debt as many large firms have loans to the property company or to its backers. Representatives for JPMorgan, Citi and Santander declined to comment.

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

CapitaLand Investment Limited – Charting new growth

Recommendation: ACCUMULATE (Initiate), Last Done: S$3.41

Target Price: S$4.00, Analyst: Natalie Ong

– Stable and recurring revenues from fees income and real estate investment contributing c.20% and c.80% to EBITDA respectively.

– Growth in fund management and lodging AUM to drive fee income while capital recycling and new economy assets remain in focus.

– Initiate coverage on CLI with an ACCUMULATE rating and SOTP derived TP of S$4.00, representing an 19.6% upside from current market price. CLI is trading at 16.0x P/E; we are forecasting FY21e dividend yield of 2.4%.

Technical Pulse: Sunny Optical Technology Group Co ltd

Recommended: Technical BUY; Analyst: Chua Wei Ren

Sunny Optical (HKEX: 2382) has been ranging for 2 quarters despite a strong upside break in August based on our report dated 30th July. The subsequent head and shoulder formation has pushed prices back below HK$200 psychological level. However, recent technicals indicate that there is potential upside

Buy spot: 199.50 Stop loss: 179.50 Take profit 1: 220.80 Take profit: 241.70

POEMS Podcast: Let the Money Talk

Recent Podcasts:

Fortress Minerals Limited – SGX Company insights Ep 31

OCBC Bank Limited – Today’s Trading Idea – Ep 15

Wilmar International Limited – Today’s Trading Idea – Ep 14

Visit www.stocksbnb.com to learn more!

Join our Phillip Securities Research Telegram channel for the latest update on our stock coverage!

Click here to join: https://t.me/stocksbnb

Webinar Of The Week

Weekly Market Outlook: Singapore 4Q21 Equity Strategy

Date: 11 October 2021

For more on Market Outlook

Updates summarised in 3 minutes

Phillip Research in 3 minutes: #29 Keppel Corporation; Initiation

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

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


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