Daily Morning Note – 22 Aug 2019
WEEKLY MARKET OUTLOOK WEBINAR
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Archived webinars available.
Stocks rose on Wednesday as strong quarterly results from retailers such as Target and Lowe’s lifted investor sentiment.
The Dow Jones Industrial Average closed 240.29 points higher, or 0.9%, at 26,202.73. The S&P 500 gained 0.8% to close at 2,924.43. The Nasdaq Composite jumped 0.9% to 8,020.21. The major indexes held on to their gains even after the bond market flashed a recession signal in the last hour of trading.
Noble Group Holdings (Noble Holdings) plans to rebuild its liquefied natural gas (LNG) and core energy businesses and develop rare earths as it seeks new life as a niche, Asia-focused commodity trader, sources aware of the matter said.
The founding Lim family’s voluntary conditional cash offer for steel trader Hupsteel has received valid acceptances representing 90.013 per cent in the mainboard-listed firm as at 5pm on Wednesday, Hupsteel announced in a regulatory filing that night.
SIIC Environment Holdings has incorporated a joint-venture (JV) company for potential investment, construction and operation of waste-to-energy projects in the Yangtze River Delta region, it announced on Wednesday.
KEPPEL Corporation unit Keppel Land China is entering a joint venture (JV) to acquire and develop a 3.8 hectare commercial and residential mixed-use development site in Nanjing, China, with an estimated total development cost in excess of five billion yuan (S$990 million), Keppel Corp announced on Wednesday.
CREATIVE Technology recorded a net loss attributable to equity holders of US$2.8 million for the fourth quarter ended June 30, compared with a net profit of US$25.6 million in the year-ago period, it said in a results release after market close on Wednesday.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, PSR
Xiaomi Corp Pte Ltd
Recommended Action: Technical SELL
Xiaomi’s (1810 HK) share price has broken the previous low of 8.98. We believe the stock will enter into a renewed downtrend
SPH REIT – Low gearing and stable income
Credit view, analyst – Timothy Ang
SPH REIT (SK6U.SI) is a Singapore-listed retail real estate investment trust with a real estate portfolio in Singapore and Australia. It currently owns the Paragon Mall, The Clementi Mall, The Rail Mall in Singapore and a stake in Figtree Grove Shopping Centre in Australia.
(+) Healthy credit profile
(+) Properties with high occupancy rates provide stable income
Thai Beverage PLC – Spirits and property gains to the rescue
Recommendation: NEUTRAL (Maintained), Last Done: S$0.89
Target Price: S$0.83 Analyst: Paul Chew
– Revenue was below our forecast. Net profit beat our estimates due to strong associate contribution. Frasers Property (FPL) reported significant property gains this quarter.
– Beer earnings dropped almost 40% as Sabeco volumes were down 2.5% YoY in 3Q19 due to destocking of brand relaunch.
– Higher margin brown spirits demand in Thailand recovered from last year post excise duty.
– Maintain NEUTRAL. We keep our SOTP-derived TP to S$0.83. Our earnings forecast is unchanged. We lowered revenues and incorporated the severance provisions but raised our associate earnings. Outlook for Thai Beverage earnings in FY20e will be highly dependent on the passing of agriculture support prices by the government. Excluding these measures, our expectations are for lacklustre earnings growth in FY20e.
Webinar Of The Week
Market Outlook: : (PSR) China Aviation (Singapore) Oil, China Everbright Water Limited, CNMC Goldmine Holdings Limited, Dasin Retail Trust, EC World REIT, ComfortDelGro Corp Ltd, Banyan Tree Holdings Limited, US Weekly, China Weekly, Technical Outlook
Date: 19 August 2019
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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