Daily Morning Note – 21 February 2022

Welcome to our Daily Morning Note from our Research team!


Singapore shares closed lower on Friday (Feb 18), amid mixed trading in regional markets as investors continued to keep an eye on geopolitical tensions in Ukraine. The Straits Times Index (STI) fell 0.4 per cent or 12.67 points to close at 3,428.90. The market barometer was little changed over the week, down just 0.05 points. Across the broader market, gainers outnumbered losers 259 to 226 after 1.3 billion securities worth S$1.2 billion changed hands.

The ongoing standoff between Russia and Ukraine as well solidifying expectations of a Federal Reserve rate increase next month, sent US stock indices closing lower on Friday. Wall Street also is bracing for the Federal Reserve to launch a series of increases in the benchmark lending rate. The benchmark Dow Jones Industrial Average ended 0.7 per cent lower at 34,079.18, and the broad-based S&P 500 also fell 0.7 per cent to 4,348.87. The tech-rich Nasdaq Composite Index lost 1.2 per cent to end at 13,548.07.

Top gainers & losers




A further round of monetary policy tightening remains on the cards this April despite the Singapore government’s decision to delay the Goods and Services Tax (GST) hike until next year, according to economists. Barclays regional economist Brian Tan said the Monetary Authority of Singapore (MAS) would likely need to tighten monetary policy “more aggressively to contain demand-pull inflation pressures – especially as the government announced measures that would further boost wage pressures over the next few years”. Finance Minister Lawrence Wong on Friday (Feb 18) announced the government’s plans to further tighten foreign labour supply alongside the rollout of the Progressive Wage Model for more sectors – retail, food services and waste management – over the next two years. Meanwhile, the GST hike, up from the current 7 per cent rate, will happen in 2 steps: to 8 per cent in 2023, then to 9 per cent in 2024.

Beleaguered liftboat operator Ezion Holdings is going into liquidation, the company announced late on Friday (Feb 18). Its winding up application, which was filed last month, has been granted by the High Court. RSM Corporate Advisory’s Ng Kian Kiat and Goh Wee Teck were appointed as joint and several liquidators. The company had previously stated it faced difficulties procuring investment and was unable to proceed with its restructuring and recapitalisation plans.

Tee International on Friday (Feb 18) said it received an order on Feb 17 to produce various documents to the Commercial Affairs Department (CAD) to assist with an investigation regarding an offence under the Securities and Futures Act (SFA). The new development comes just 1 day after the Singapore Exchange said it reported the mainboard-listed engineering group to relevant authorities for potential offences under the SFA. The bourse operator is also investigating the company for potential listing rule breaches. All of Tee International’s independent directors, its non-executive director and the managing director of its engineering and construction business were also asked to assist with CAD’s investigations, the company said in a bourse filing. They have been interviewed by the CAD on Feb 17 and Feb 18.


E-commerce sites operated by China’s Tencent and Alibaba Group were included on the US government’s latest “notorious markets” list of entities that allegedly sell or facilitate the sale of counterfeit goods, the US Trade Representative’s (USTR) office said on Thursday (Feb 17). The list identifies 42 online markets and 35 physical markets that are reported to engage in or facilitate substantial trademark counterfeiting or copyright piracy. “This includes identifying for the first time AliExpress and the WeChat e-commerce ecosystem, 2 significant China-based online markets that reportedly facilitate substantial trademark counterfeiting,” the USTR office said in a statement. China-based online markets Baidu Wangpan, DHGate, Pinduoduo and Taobao also continue to be part of the list, along with 9 physical markets located within China “that are known for the manufacture, distribution, and sale of counterfeit goods”, the USTR office said. The list highlights online and physical markets that reportedly engage in or facilitate substantial trademark counterfeiting or copyright piracy.

Major natural gas exporting nations on Sunday began meetings in Doha to discuss how to meet skyrocketing world demand as tensions surrounding Ukraine stoke fears in Europe about gas supplies from Russia. Experts from the 11-member Gas Exporting Countries Forum (GECF) started meetings in the Qatari capital, ahead of ministerial level talks on Monday and heads of state and government on Tuesday. Member states include Russia, Qatar, Iran, Libya, Algeria and Nigeria – who together account for more than 70 per cent of proven gas reserves – and the meetings opened as Ukraine complained of “new provocative shelling” on the frontline between its forces and Russian-backed rebels. With Europe’s fears growing that Russia will invade Ukraine, natural gas prices are at close to double the level they traded at in late 2020. European nations are frantically seeking alternative supplies to Russian gas, which feeds 40 per cent of the European market.

Sales of previously owned homes unexpectedly increased to a one-year high as buyers rushed in ahead of a surge in mortgage rates, further depleting tight inventories to a record low. Contract closings increased 6.7 per cent in January from the prior month to an annualised 6.5 million, figures from the National Association of Realtors showed Friday. All four regions saw gains on a monthly basis. The median forecast in a Bloomberg survey of economists called for a 6.1 million annualised rate in January. “Buyers were likely anticipating further rate increases and locking-in at the low rates, and investors added to overall demand with all-cash offers,” Lawrence Yun, NAR’s chief economist, said in a statement Friday. “Consequently, housing prices continue to move solidly higher.” With American demand for homes still outstripping supply, the current pace of sales depends in large part on the availability of properties. January’s increase in sales came almost entirely from homes priced above US$500,000, and the recent spike in mortgage rates may temper future demand.

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

Singapore Strategy: Budget 2022 – Cascading wages and tighter labour conditions

Analyst: Paul Chew

– FY2021 overall fiscal deficit was S$5bn (0.9% GDP), below the estimated S$11bn. The difference came from stamp duty revenue (+$2.2bn), income tax (+S$1.0bn), GST (+S$0.7bn), lower expenditure (+S$3.9bn), investment returns (+S$0.8mn) offset by higher special transfers of S$3.0bn.

– Fiscal deficit in FY2022 is budgeted at S$3bn, or 0.5% of GDP.

– GST will be raised from 7% to 8% on 1 January 2023 and from 8% to 9% on 1 January 2024.

– Higher wages are expected from the implementation of progressive wage schemes, lower dependency ratio ceiling and higher qualifying salaries for foreign workers. Most impacted will be F & B retail, construction, marine and manufacturing sectors. The concern is that higher wages at the lower tier could have a cascading impact on the overall wages of a company. No mention of wealth taxes but higher tax rates imposed on residential properties and luxury cars.

POEMS Podcast: Let the Money Talk

Recent Podcasts:

Koda Limited 1H22 Results

Amazon.com Inc 4Q21 Results

FAANGM Monthly Jan 2022

Visit www.stocksbnb.com to learn more!


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

Click the link to join: https://t.me/stocksbnb


Weekly Market Outlook: Amazon, FAANGM Monthly, BRC, SGX, SG Banking, ART, StarHub, Oxley, Singapore Weekly

Date: 14 February 2022

Click here for more on Market Outlook

Sign up for our webinars here, and be among the first to receive economy and market updates.

HK Reports – Read up on our Hong Kong reports here

Updates summarised in 3 minutes

Phillip Research in 3 minutes: #29

Keppel Corporation; Initiation

Click here for more videos on Phillip in 3 Mins

For any research-related matters, email: research@phillip.com.sg

For general enquiries, email: talktophillip@phillip.com.sg
or call 6531 1555.

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 is provided to you for general information only and is not intended to create any binding legal relation. The information or opinions provided in this email do not constitute investment advice, a recommendation, an offer or solicitation to subscribe for, purchase or sell any investment product. 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 should obtain advice from a financial adviser before making a commitment to invest in any investment product or service. In the event that you choose not to obtain advice from a financial adviser, you should assess and consider whether the investment product or service is suitable for you before proceeding to invest.

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