Daily Morning Note – 21 November 2020

PHILLIP SUMMARY

Stocks looked set for a cautious start to the week as traders monitored developments on progress toward a vaccine. The pound ticked up. S&P 500 futures opened with little fanfare and Australian shares edged higher in early Monday trading as global equities remain within a whisker of the record high set earlier this month. Vaccinations against Covid-19 in the U.S. will “hopefully” start in less than three weeks, according to the head of the federal government’s program to accelerate a vaccine. Japan is shut for a holiday and Treasuries won’t trade until the London open.

BREAKING NEWS

INVESTORS will have easier access to Hong Kong-listed technology stocks next month, as OCBC works towards the listing of a tech-focused exchange-traded fund on the Singapore Exchange. The Lion-OCBC Securities Hang Seng TECH ETF will track the Hang Seng TECH Index, which is made up of the top 30 technology companies listed in Hong Kong by market capitalisation.

China will show “zero tolerance” for misconduct following a recent string of bond defaults, a meeting of the Financial Stability and Development Committee chaired by Vice-Premier Liu He said. Fraudulent issuance, disclosure of false information, malicious transfer of assets and misappropriation of issuance funds will be strictly investigated, said the meeting, according to an account posted on a government website.

General Electric and a Vietnamese company signed a memorandum of understanding to develop an LNG (liquified natural gas) power plant near Ho Chi Minh City. The signing between GE and EVN Genco3 took place during an event with President Donald Trump’s National Security Adviser Robert O’Brien in Hanoi on Saturday. Mr O’Brien, in Vietnam for a three-day visit which includes meetings with government officials and a speech to international relations students, said the companies will develop a plant that will provide 3,600 megawatts of power.

On Nov 18, Medtecs International Corporation executive director and CEO William Yang Weiyuan acquired one million shares of the listed company for a consideration of S$921,998 at an average price of 92.20 cents per share. According to the filing, Mr Yang was not previously holding Medtecs shares. The share price of Medtecs has soared from 3.7 cents at the end 2019 to 92.00 cents as of Nov 19.

CATALIST-LISTED Jiutian Chemical Group recently became the world’s second-largest dimethylformamide (DMF) producer, after a competitor exited the business. The economics of its chemicals production business have also improved, and the company expects this situation may continue for some time.

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

TECHNICAL REPORTS

NetEase Inc

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

NetEase Inc (US: NTES) corrective downside may soon be coming to an end based on the technical and wave analysis.

Sea Limited

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Sea Limited (US: SE) upside is still on play despite some minor correction since our report dated 28th October 2020. Recent technical indicate a return of the upside once more

>> Read more Technical reports

RESEARCH REPORTS

Singapore REITs Monthly – Looking beyond near-term weakness

Recommendation: OVERWEIGHT (Maintained), Analyst: Natalie Ong

– FTSE S-REIT Index underperformed the STI and Real Estate Developer Index. Hospitality segment was the best performer, up 16.0%, lifted by news of vaccine progress. Industrial segment fared the worst, down 2.2%.

– Sector yield spread of 338bps over the benchmark 10-year SGS (10YSGS) was -0.1SD.

– Remain OVERWEIGHT on SREITs with catalysts expected from acquisitions fuelled by the conducive interest rate environment. Sub-sector preferences are hospitality (upgraded), office and industrial. Top picks are Manulife US REIT (MUST SP, Buy, TP: US$0.92), Frasers Centrepoint Trust (FCT SP, Accumulate, TP: S$2.79) and Ascendas REIT (AREIT SP, BUY, S$3.61).

SG Bonds Weekly – Week 48

Credit Analyst: Timothy Ang

– Activity in the Asia primary debt market was largely muted as the market digests the impact of Trump’s ban on investments in securities related to the Chinese military.

– Newly formed holding company Aviva Singlife Holdings Pte Ltd has priced S$550 million of 10.25-year callable subordinated notes at 3.375 per cent.

– The People’s Republic of China sold its first negative-yielding government bond this week in a three-tranche euro-denominated issuance that that was dominated by yield hungry European investors.

>> Read more research reports

HK Reports – Read up on our Hong Kong reports here

RESEARCH VIDEOS

Webinar Of The Week

Market Outlook: (PSR) StarHub, Banks & REIT Results, Banking Monthly, Credit Commentary, SG Weekly & more

Date: 09 November 2020

For more on Market Outlook

Updates summarised in 3 minutes

Phillip Research in 3 minutes: #26 – iX Biopharma Ltd; Initiation

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Read the research report(s), available through the link(s) above, for complete information including important disclosures Important Information





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