Daily Morning Note – 24 July 2020

PHILLIP SUMMARY

Stocks in Asia were poised to follow U.S. equities lower after an unexpected rise in jobless claims rekindled concern the economic recovery has stalled. Treasuries rose.

Futures slid in Hong Kong and Australia. Contracts on the S&P 500 Index edged higher after the gauge earlier slipped from a four-month high, led by losses in technology firms and companies that make non-essential consumer goods. The Nasdaq 100 Index dropped to a two-week low and turned negative for the week, erasing Monday’s rally. Intel Corp. slumped in after-hours trading after warning about a production delay.

BREAKING NEWS

MAPLETREE Commercial Trust (MCT) on Thursday reported a 10.7 per cent year-on-year decline in net property income to S$78.9 million for the first quarter, attributing it largely to rental rebates given to retail tenants at its core VivoCity property during the Covid-19 pandemic. Gross revenue for the quarter ended June 30 was down 10.5 per cent on the year to S$100.4 million, while property operating expenses were 9.7 per cent lower on the year to S$21.5 million.

OUE Commercial Real Estate Investment Trust (C-Reit) on Thursday posted a distribution per unit (DPU) of one Singapore cent for the half-year ended June 30, 40.5 per cent lower than a year ago. It said it had retained S$13.8 million of distribution to “preserve financial flexibility” amid the Covid-19 pandemic. Revenue for the second quarter had risen 23.9 per cent on the year to S$64.3 million, resulting in a 32.4 per cent year-on-year (y-o-y) increase in H1 revenue to S$142 million. Net property income for Q2 increased 23.7 per cent on the year to S$50.4 million, due to the contribution from the merger with OUE Hospitality Trust last year, although this was partially offset by rental rebates to tenants.

SUNTEC Real Estate Investment Trust (Suntec Reit)’s distribution per unit (DPU) fell by 31.3 per cent to 3.293 Singapore cents for the six months ended June 30, from 4.795 cents a year ago. This comprises a DPU of 1.76 cents for the three months ended March 31 and a DPU of 1.533 cents for the three months ended June 30, the real estate investment trust’s (Reit) manager said in a regulatory filing on Thursday. Gross revenue was down 16.1 per cent to S$149.4 million for the half year, from S$178.1 million a year ago.

FIRST Sponsor Group on Thursday posted a 49.4 per cent rise in net profit to S$58.1 million for the six months ended June 30, from S$38.9 million a year ago. The property group achieved a higher overall gross margin of 80.7 per cent in H1, compared to 69.2 per cent a year ago. It said this was due mainly to a change in sales mix, as the higher-yielding property financing business contributed a larger share of the total revenue in the current period.

ELITE Commercial Reit on Thursday posted a distribution per unit (DPU) of 1.95 pence for the period from Feb 6 to June 30, 2020, 1 per cent higher than its initial public offering (IPO) forecast of 1.93 pence. The real estate investment trust (Reit) was listed on the Singapore bourse on Feb 6 this year, opening at 70.5 pence, 3.7 per cent higher than its IPO price of 68 pence. Revenue for the period came in at £9.32 million (S$16.4 million), 0.3 per cent higher than its forecast of £9.28 million. Net property income stood at £9.1 million, 0.2 per cent above its IPO forecast of about £9 million.

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

TECHNICAL PULSE

Singapore Exchange Ltd

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Singapore Exchange Ltd (SGX: S68) decline has been met with resistance after prices failed to break below $8.00 psychological support despite our sell call on 2nd July. Prices managed to stay above $8.25. Based on the technicals, prices are set to rally once again.

>> Read more technical reports

RESEARCH REPORTS

CapitaLand Mall Trust – Uphill from here

Recommendation: BUY (Maintained), Last Done: S$2.03

Target Price: S$2.33, Analyst: Natalie Ong

– 1H20 DPU of 2.96cents was -49% YoY and included one-third ($23.2mn) of the distributable income retained in 1Q20.

– The worst is over, baring a second wave of the virus. Footfall has recovered to 53% of January levels. 1H20 tenant sales fell -15.4% YoY, better than expected, while portfolio occupancy remained high at 97.7%, clocking +0.1% rental reversions for 2Q20.

– Maintain BUY with an unchanged TP of $2.33. We are keeping our estimates unchanged as we have previously incorporated c.$80mn of out-of-pocket (OOP) rental rebates, above the $76.5mn OOP rebates guidance for 1H20.

>> 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: #24 – Hyphens Pharma International Ltd; 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.

 

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