Daily Morning Note – 21 September 2021

PHILLIP SUMMARY

Major US stock indices finished with heavy losses on Monday, as fears of a debt crisis in China and a credit default in the United States sparked a selloff. The benchmark Dow Jones Industrial Average was 1.8 per cent lower at the close at 33,970.47. The broad-based S&P 500 lost 1.7 per cent to finish at 4,357.73. The tech-rich Nasdaq Composite Index lost 2.2 per cent to 14,713.90.
The day had started ugly, with Wall Street indices opening deep in the red as traders fretted over the fate of Evergrande, one of China’s biggest developers that is awash in debt of more than US$300 billion and teetering on collapse. Their plunge continued throughout the day, with all indices losing at least two per cent, though the S&P 500 and Dow managed to reign in some of their losses. September is known for rocky trading, but the situation was made worse by the ongoing impasse in Congress over raising the US debt limit.


BREAKING NEWS

SG News

Jumbo Group announced that it has officially opened its second Jumbo Seafood outlet in Beijing at the Universal Studios’ Beijing resort in a regulatory filing on Monday evening. It is also the group’s eighth Jumbo Seafood restaurant in China and its 17th across Asia. The newly-opened outlet is located at the Universal CityWalk complex and occupies an area of approximately 1,026 square metres, with an indoor seating capacity of 229 and an outdoor seating capacity of 36. The restaurant also features two private rooms that can seat up to 22 patrons.

The ongoing shake-up in China’s real estate sector levels the playing field and could throw up interesting opportunities for foreign property players such as CapitaLand, said group chief executive of CapitaLandInvest Lee Chee Koon. On Monday, CLI made its trading debut on the Singapore Exchange as one of the world’s largest listed real estate investment managers (REIMs) after property giant CapitaLand carved up its business into two separate entities – namely, CLI and privatised property development arm, CapitaLand Development (CLD).

Singapore Kitchen Equipment announced on Monday that its chairman and independent non-executive director Tan Bee Kiew has resigned due to medical reasons. Madam Tan is also stepping down from her role as chairman of the audit committee and member of the nominating committee and remuneration committee with effect from Monday. Based on its enquiries, the company’s sponsor, CIMB Bank Berhad, Singapore Branch is satisfied that there are no other material reasons for Ms Tan’s resignation.

Property and hospitality group Roxy-Pacific Holdings has received a pre-conditional voluntary general offer from TKL & Family for all the issued ordinary shares in the company. The offeror is the bid vehicle of a consortium formed by 11 individuals, including the chairman and chief executive of Roxy-Pacific, Teo Hong Lim. The privatisation will allow shareholders to realise their investment at an attractive price and compelling premium amid low trading liquidity, as well as exit their investment as the company is facing a challenging macro and operating environment driven by the Covid-19 pandemic, Roxy-Pacific said in a bourse filing on Monday.

Insurers in Singapore have beaten banks in the quality customer experience (CX) for the first time since 2018 – the year Forrester’s survey on the topic started. The research and advisory firm on Monday said it surveyed more than 2,000 Singapore consumers across 11 brands (six insurers and five banks) to form its Singapore CX Index benchmarks. The survey found that overall CX quality in Singapore improved by three points to 63.3 from 60.3 on a 100-point scale, as every insurance brand improved their CX scores.


US News

Gold prices inched lower on Monday, pressured by a firmer dollar, while investors awaited guidance from the US Federal Reserve on when it is likely to start withdrawing its bond-buying programme. Spot gold dipped 0.1 per cent to US$1,752.66 per ounce by 12.50am GMT, while US gold futures edged up 0.1 per cent to US$1,753.80. The dollar index hit a near one-month high, denting gold’s appeal for holders of other currencies. The Fed is expected to open the door to reducing its monthly bond purchases when it meets on Sept 21-22, while tying any actual change to US job growth in September and beyond.

Oil prices fell 2 per cent on Monday as investors grew more risk-averse, which hurt stock markets and boosted the US dollar, making oil more expensive for holders of other currencies Brent crude fell US$1.42, or 1.9 per cent, to settle at US$73.92 a barrel after sinking to a session low of US$73.52. US West Texas Intermediate (WTI) declined US$1.68, or 2.3 per cent, to end at US$70.29 after falling to as low as US$69.86.

Royal Dutch Shell said on Monday it would sell its Permian Basin assets to ConocoPhillips for US$9.5 billion in cash, an exit from the largest US oilfield for the energy major shifting its focus to the renewable energy transition. For ConocoPhillips, it is the second sizable acquisition in a year in the heart of the US shale industry, as American and European producers diverge in whether to focus on hydrocarbons going forward.

Cryptocurrency prices slumped as a broad selloff sparked by worries about contagion from China Evergrande Group swept through global markets. Bitcoin dropped 5.4 per cent to US$45,025 just before 10 am in London (just before 6pm Singapore time), reaching the lowest level in a week. Other digital assets also retreated, with Bitcoin Cash and Ether all declining.

The United States’ decision to lift restrictions on incoming travellers vaccinated against Covid-19 was met with a sigh of a relief by the global airline sector, which has been dealt a body blow by the pandemic. With transatlantic flights traditionally among the most lucrative for Europe’s biggest airlines, the Monday announcement was “formidable news” for a sector that has haemorrhaged tens of billions of euros over the past 18 months, Air France-KLM chief Benjamin Smith told AFP.


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

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