Daily Morning Note – 21 November 2018
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YOUR PHILLIP SUMMARY
Dow plunged more than 500 points, erasing gain for 2018 as a decline in Target shares pressured retailers, while some of the most popular tech shares dropped again. Tech shares also fell after The Financial Times reported Chinese authorities have alleged “massive evidence” of antitrust violations by Samsung, SK Hynix and Micron Technology. The report also said China would deepen its investigation into the three companies, which are the largest memory-chip manufacturers in the world.
Stocks in Asia mostly slipped on Tuesday. Shares of Japanese automaker Nissan fell 5.45 percent on Tuesday after its chairman, Carlos Ghosn, wasarrested a day earlier over allegations of financial misconduct.
Gold inched lower on Tuesday, pressured by a slight uptick in the dollar and held a narrow range in light trade ahead of the U.S. Thanksgiving holiday.
Oil prices plummeted as much as 7 percent on Tuesday, snapping four days of gains and renewing a sell-off that has plunged crude futures into a bear market. The renewed selling in the energy complex dovetailed with a sharp pullback in the stock market.
Singapore REITs Monthly – Monthly Tracker: November 2018
Analyst: Tara Wong
– FTSE S-REIT total return declined 4.9% YTD. Weakness across all sub-sectors –
save for hospitality over the past month – with Frasers Hospitality Trust being
the top performer (+5.6% MTD) and Keppel-KBS US REIT being the worst
performer (-17.0% MTD).
– Sector yield spread of 273bps over the benchmark 10-year SGS (10YSGS) yield
remains close to the -1 standard deviation (SD) level as at end-October.
– 3m SOR continued to rise YTD, ending at 1.73% in October.
– Remain NEUTRAL on S-REITs sector. Sub-sector preferences: Office and
Dow dives 2.2%, moves into the red for 2018. Wall Street stocks suffered a second consecutive battering on Tuesday, with weakness in the technology sector spreading to other areas, especially energy and retail. The Dow Jones Industrial Average plunged 2.2 per cent, or more than 550 points, to finish at 24,465.64, wiping out its gains for the year and then some. The broad-based S&P 500 shed 1.8 per cent to 2,641.89, while the tech-rich Nasdaq Composite Index fell 1.7 per cent to 6,908.82. After Tuesday, the Nasdaq was the only one of the three indices still clinging to a modest gain for the year, but stood at its lowest levels in more than seven months.
Offtakers seek to end water purchase contract for Hyflux JV plant in Algeria. The offtakers of its Souk Tleta desalination plant in Algeria are trying to terminate their water purchase agreement. The Souk Tleta plant supplies water to Algérienne des Eaux, the state-owned national water company of Algeria, and Sonatrach, the national oil company. The offtakers have sent a “purported notice of termination” to Almiyah Attilemcania, the project developer, and its 51 per cent shareholder Tlemcen Desalination Investment Company (TDIC). Hyflux owns 30 per cent of TDIC.
Waste treatment firm China Jinjiang Environment wins project worth some 330m yuan. It has secured a concession from a local government to construct, own and operate a waste-to-energy facility located in Leting County, Hebei Province, with the project bearing an estimated total investment cost of about 330 million yuan (S$65.5 million).
Oxley Holdings deputy CEO raises his stake to 29.78% as share price keeps falling. Low See Ching paid S$0.295 a share in a market transaction for 300,000 shares, bringing his interest in the company to 29.78 per cent from 27.77 per cent previously.
Source: CNBC, Bloomberg, Reuters, The Business Times, Phillip Securities Research
Clients of Phillip Securities can keep updated with Country Strategy and Singapore Sector Reports by logging into: www.poems.com.sg > STOCKS > Research
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