Daily Morning Note – 19 March 2020

WEEKLY MARKET OUTLOOK WEBINAR

PHILLIP SUMMARY

The euro and U.S. equity futures rose after the European Central Bank announced a huge boost in stimulus, adding to efforts across the world that have largely underwhelmed investors so far.

S&P 500 futures reversed losses to rise about 1% and the euro edged up. The ECB launched a new temporary program worth 750 billion euros ($820 billion) to fight the impact of the coronavirus pandemic. Wall Street earlier suffered another plunge as investor focus turned to assessing the length of the downturn. Oil rose to take back some of Wednesday’s 24% plunge that left prices at an 18-year low.

BREAKING NEWS

FITCH Ratings on Wednesday said Singtel‘s weaker-than-expected growth prospects and potential for higher capital expenditure for the 5G standalone network in Singapore are likely to reduce visibility on the group’s free cash flow. This comes after the agency had in February downgraded Singtel’s long-term foreign- and local-currency issuer default ratings (IDR) and foreign-currency senior unsecured rating to A from A+.

CITY Developments Limited (CDL) subsidiary Millennium & Copthorne Hotels New Zealand has forecast around NZ$24 million (S$20.4 million) in hotel revenue loss for the first half of 2020. This comes as the New Zealand government rolls out new border entry restrictions due to the novel coronavirus outbreak, which apply until the end of March.

MANULIFE US Real Estate Investment Trust (Manulife US Reit) has secured a US real estate enterprise as a long-term tenant at its Plaza office building in Secaucus, New Jersey, it said on Wednesday. On March 13, the new tenant signed the lease for roughly 53,000 square feet (sq ft) for its headquarters with a 12-year tenure and positive rental reversion, the Reit said.

NEXT month, creditors will vote on the proposed schemes of arrangement based on Utico’s rescue package for troubled water treatment firm Hyflux and three of its subsidiaries. All the meetings will take place at the Hyflux Innovation Centre on 80 Bendemeer Road.

THE proportion of shares of mainboard-listed Tee Land in the hands of the public has fallen below a key threshold following a cash offer. This means the Singapore Exchange may suspend trading of the developer’s shares at the close of the offer on March 20.

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

RESEARCH REPORTS

Singapore Banking Strategy: Cheaper than during Global Financial Crisis

Recommendation: Overweight (Maintained)

Analyst: Tay Wee Kuang

– Selling pressure drove prices of banking stocks below Global Financial Crisis (GFC) low Price-to-Book (P/B) ratios.

– Even under stressed scenario, banks can meet their dividend payout. Last dividend cut was during the 2008 GFC when Tier-1 capital ratio was 12.0% vs 15.3% currently (before CET-1 was introduced).

– Banks stocks now trading at above 6.5% dividend yield.

– Maintain Singapore Banking Sector at Overweight. Recent price weakness presents an opportune time for investors to enter with an attractive yield.

Read more technical reports

HK Reports – Read up on our Hong Kong reports here

RESEARCH VIDEOS

Webinar Of The Week

Market Outlook: (PSR) City Development Limited, CapitaLand Limited, Dasin, EC World, REITS & Banking Monthly, SG Weekly & Technicals

Date: 16 March 2020

For more on Market Outlook

Phillip Research in 3 minutes: #18 – Singapore Budget 2020

Updates summarised in 3 minutes

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.