Daily Morning Note – 22 July 2020

PHILLIP SUMMARY

Oil prices rose about US$1 a barrel on Tuesday, hitting the highest level in more than four months with a boost from a European Union stimulus deal and hopeful news about coronavirus vaccine trials.

Brent crude futures settled at US$44.32 barrel, rising US$1.04, or 2.4 per cent. West Texas Intermediate (WTI) settled at US$41.96 a barrel, gaining US$1.15, or 2.8 per cent.

Prices pared gains in post-settlement trade after the American Petroleum Institute, an industry group, reported US crude inventories grew last week by 7.5 million barrels compared with expectations for a draw of 2.1 million barrels.

Oil was buoyed by an agreement among European Union leaders on a 750 billion-euro (S$1.2 trillion) fund to prop up coronavirus-hit economies.

BREAKING NEWS

Thomson Medical Group said on Tuesday that Thomson Kids Pte Ltd (TKPL), incorporated by the group’s indirect wholly-owned subsidiary Thomson Medical Pte Ltd, will focus on children’s developmental health and well-being.

London-based Nithia Capital Resources Advisors is seeking to acquire troubled Singapore commodity trader Agritrade International (AIPL) and its shares in its Hong Kong-listed subsidiary, according to a source familiar with the matter.

Singapore shares rose on Tuesday, reversing Monday’s lacklustre performance amid renewed hopes for a virus vaccine and the European Union stimulus deal.

European shares closed above four-month highs on Tuesday, with Germany’s blue-chip DAX erasing almost all its losses for the year, after EU leaders agreed on a landmark stimulus package to revive the bloc’s economies from a coronavirus-induced slump. The pan-European Stoxx 600 jumped as much as 1.3 per cent before ending 0.3 per cent higher at its highest since early March, as did an index of euro zone blue-chip stocks which rose 0.5 per cent.

New agreement between Singapore Exchange Regulation (SGX RegCo) and Nasdaq will facilitate the regulatory exchange of information on issuers that are dual-listed on both exchanges. This includes a streamlined framework for issuers seeking a secondary listing on SGX.

Shares of banks and petroleum-linked companies rocketed higher on Tuesday, lifting the Dow even as the Nasdaq retreated from its record in the prior session. Dow members Exxon Mobil and Chevron jumped 7.1 per cent and 5.1 per cent respectively as oil prices climbed to their highest level in four months following agreement of a massive European stimulus plan.

Somber President Donald Trump warned on Tuesday that the coronavirus crisis in the United States is likely to “get worse before it gets better.” “Some areas of our country are doing very well,”

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

RESEARCH REPORTS

Keppel DC REIT – Premium for a future-ready asset classs

Recommendation: NEUTRAL (Maintained), Last Done: S$2.75

Target Price: : S$2.57, Analyst: Natalie Ong

– 1H20 DPU of 4.375cents was in line, forming 49% of FY20e DPU estimates

– Portfolio metrics healthy – long WALE of 7.4 years, portfolio occupancy at 96.1% and AEIs to drive revenue growth.

– Reiterate NEUTRAL with a higher target price of $2.57 (previously $2.31). We raised our terminal growth rate assumption from 1.5% to 2.0% to better reflect KDC acquisition-driven 5-year DPU CAGR of 2.7%. While we like KDC for its strong portfolio metrics and future-ready asset class, we think that upside is limited given the strong rally in prices and yields at c.3%, are not compelling.

>> Read more research reports

HK Reports – Read up on our Hong Kong reports here

RESEARCH VIDEOS

Webinar Of The Week

Market Outlook: Market Outlook: SG Banking Monthly, SG Bonds Weekly and SG Strategy 3Q20 (with stock picks)

Date: 06 July 2020

For more on Market Outlook

Phillip Research in 3 minutes: #23- Yoma Strategic Holdings; Initiation

For more videos on Phillip in 3 Mins

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





Disclaimer
The information contained in this email and/or its attachment(s) is provided to you for information only and is not intended to or nor will it create/induce the creation of any binding legal relations. The information or opinions provided in this email do not constitute an investment advice, an offer or solicitation to subscribe for, purchase or sell the e investment product(s) mentioned herein. 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 may wish to seek advice from an independent financial adviser before making a commitment to purchase or investing in the investment product(s) mentioned herein. In the event that you choose not to do so, you should consider whether the investment product(s) mentioned herein is suitable for you. PhillipCapital and any of its members will not, in any event, be liable to you for any direct/indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials attached to this email. The information and/or materials provided 揳s is?without warranty of any kind, either express or implied. In particular, no warranty regarding accuracy or fitness for a purpose is given in connection with such information and materials.
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.