DAILY MORNING NOTE | 24 January 2024

Chinese Big 4 banks poised for a rebound

Analyst: Zane Aw

– The Chinese Big 4 banks have reached their respective support levels following a pullback and are poised for a rebound

– China Construction Bank and Industrial and Commercial Bank of China are likely to retest their respective downtrend channel resistances after pulling back to their channel supports coupled with double and triple bottom formations

– Bank of China is expected to resume its current uptrend from its uptrend channel support while Agricultural Bank of China is likely to rebound from its range support with further upside potential from a bullish cup and handle formation

Trades Initiated in the past week

Factsheets


Singapore stocks ended in the red on Tuesday (Jan 23), continuing their losing streak for the second day in a row. Their performance bucked the trend of regional bourses which mostly ended in the black. The index fell 0.4 per cent or 13.87 points to close at 3,135.25. Across the broader market, decliners outnumbered advancers 293 to 264 after 1.5 billion securities worth S$1.1 billion changed hands.

US stocks ended the day mixed on Tuesday (Jan 23), as corporate earnings results weighed on some companies and sent others surging. The Dow Jones Industrial Average fell rose 0.3 per cent to 37,905.45, snapping a three-day winning streak that pushed it to record highs on Monday. The broad-based S&P 500 closed up 0.3 per cent at 4,864.60, and the tech-heavy Nasdaq Composite Index gained 0.4 per cent to close the day at 15,425.94.

Top gainers & losers

Factsheets


Events Of The Week

Factsheets


SG

Headline inflation last year was 4.8 per cent year on year, against MAS and MTI’s forecast of “around 5 per cent”. Similarly, 2023 full-year core inflation – which excludes accommodation and private transport – at 4.2 per cent was close to the official forecast of “around 4 per cent”. Headline inflation in 2022 averaged 6.1 per cent, while core inflation was 4.1 per cent.

Sabana Industrial Real Estate Investment Trust posted a distribution per unit (DPU) of S$0.0115 for the half-year ended Dec 31, 2023, down 21.2 per cent from the year-ago period. The sharp decline came as 10 per cent of total income available for distribution in FY2023 was retained for “prudent capital management”, in view of additional costs that would be incurred during the internalisation of the Reit manager, according to a bourse filing on Tuesday (Jan 23).

Keppel has taken out sustainability-linked revolving credit facilities with DBS and UOB of S$500 million each, with tenures of up to three years, to be used to enhance the company’s sustainability performance. The asset manager said on Tuesday (Jan 23) that the loans come with “preferential interest margins which are tied to Keppel’s achievement of certain sustainability performance targets (SPTs), and would be stepped-up if Keppel does not achieve those SPTs”.

Metech International has received letters of demand from legal firm Setia Law for costs incurred over its dispute with another company, X Diamond Capital, and other parties, it disclosed in a bourse filing on Tuesday (Jan 23). On Jan 18, Metech received letters from Setia Law demanding payment of S$88,932.06 from the company, and S$138,380.66 from its subsidiary, Asian Eco Technology (AET). Payment is due within seven days of the date of the letters.


US

General Electric expects profit in its aerospace business to climb in 2024, highlighting the potential earnings power of the world’s largest jet-engine maker as it prepares to become a standalone business. GE Aerospace should produce as much as US$6.5 billion in operating profit this year, even as it takes on about US$600 million in costs as it becomes an independent company, GE said on Tuesday (Jan 23) in a statement announcing fourth-quarter results. That compares to about US$6.1 billion in operating profit generated by the jet-engine division in 2023.

Procter & Gamble cut its annual profit forecast on Tuesday (Jan 23) as the boost from earlier price hikes fades in the US and after writing down the value of its Gillette business in December. The company estimated it would record up to US$2.5 billion in charges over two fiscal years due to the Gillette business write down and restructuring of certain markets. Sales of its high-end SK-II skin-care brand fell 34% in the greater China region during its latest quarter — and it blamed an unlikely culprit.

Netflix reported fourth-quarter net income of $937.8 million, or $2.11 per share, versus $55.3 million, or 12 cents per share, in the prior-year period. The company posted revenue of $8.83 billion for the quarter, up from $7.85 billion in the year-ago quarter. As Netflix focuses on improving profits, the company increased its 2024 full-year operating margin forecast to 24%, up from a range of 22% to 23%. It cited the weakening of the U.S. dollar and a stronger-than-forecast fourth-quarter performance.

3M forecasted earnings adjusted for one-time items of $9.35 a share to $9.75 a share for 2024, compared with the consensus estimate of $9.82 a share. As for the fourth quarter, revenue was less than expected, falling less 1% from a year earlier to $7.69 billion, compared with the consensus estimate of $7.72 billion.

Johnson & Johnson on Tuesday reported fourth-quarter earnings and revenue that narrowly edged out Wall Street’s expectations as sales in the company’s pharmaceutical and medical devices businesses surged. J&J also provided full-year guidance for 2024, forecasting sales of $87.8 billion to $88.6 billion and adjusted earnings of $10.55 to $10.75 per share.

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


RESEARCH REPORTS

PSR Stocks Coverage

Factsheets

Factsheets


For more information, please visit:

https://www.stocksbnb.com/singapore-stocks-coverage/


Upcoming Webinars

Corporate Insights by Sheffield Green Ltd

Date & Time: 24 January 2024 | 12pm – 1pm

Register: http://tinyurl.com/b997c3jf


Corporate Insights by Ohmyhome [NEW]

Date & Time: 25 January 2024 | 12pm – 1pm

Register: http://tinyurl.com/bdhpd33e


Corporate Insights by AIMS APAS REIT

Date & Time: 1 February 2024 | 12pm – 1pm

Register: http://tinyurl.com/jbvphczb


Corporate Insights by Keppel DC REIT

Date & Time: 1 February 2024 | 3pm – 4pm

Register: http://tinyurl.com/mr2ypw7n


Corporate Insights by MoneyHero Group

Date & Time: 6 February 2024 | 12pm – 1pm

Register: http://tinyurl.com/32yjvzpf


Corporate Insights by Emperador Inc. [NEW]

Date & Time: 7 February 2024 | 12pm – 1pm

Register: http://tinyurl.com/5anfpasu


Corporate Insights by Resources Global Development Limited [NEW]

Date & Time: 8 February 2024 | 12pm – 1pm

Register: http://tinyurl.com/5n7yejd3


POEMS Podcast:

Research Videos

Weekly Market Outlook: US Banks, FAANGM, Tech Analysis, SG Weekly, SG REITs Monthly & More!
Date: 22 January 2024
Click here for more on Market Outlook.
Sign up for our webinars here, and be among the first to receive economy and market updates.

PHILLIP RESEARCH IN 3 MINS

Phillip Research in 3 minutes: #29 Keppel Corporation; Initiation
Click here for more on Phillip in 3 mins.

Follow our Socials

Facebook Social Icon Instagram Icon Twitter Social Icon Youtube Social Icon Linkedin Social Icon TikTok Social Icon Spotify Social Icon

Join our Singapore Equity Research Community on POEMS Mobile 3 App for the latest research reports, market updates, insights and more

Click to join!

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.

Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you

IMPORTANT INFORMATION

This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <www.phillipfunds.com> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  

 

Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066 www.phillipfunds.com