Daily Morning Note – 25 May 2022


Welcome to our Daily Morning Note from our Research team!


Singapore stocks extended losses on Tuesday (May 24), in line with a regional retreat. The Straits Times Index (STI) fell 0.58 per cent or 18.61 points to 3,195.04 at the closing bell. The majority of index constituents ended in the red, with DFI Retail Group at the bottom of the table. The pan-Asian retailer tumbled 2.55 per cent or US$0.07 to end at US$2.68. Jardine Matheson was the top gainer, climbing 1.58 per cent or US$0.87 to S$55.84. Most other indices in Asia also fell. Hong Kong’s Hang Seng Index closed 1.75 per cent lower, South Korea’s benchmark Kospi slumped 1.57 per cent, Japan’s Nikkei index ended down 0.94 per cent, while Kuala Lumpur Composite Index fell 0.73 per cent. Jakarta Composite Index bucked the trend, climbing 1.07 per cent.

The Nasdaq suffered another ugly round of selling on Tuesday as a briefly upbeat market ran into a wall of weak earnings and economic data. The momentum from Monday’s sunny session ended with a thud as two of the three major indices ended back in the red after investment banks UBS Group and JPMorgan Chase cut their China economic growth forecasts. Sentiment was further dented by data showing new US home sales plunging in April to their lowest level in two years. The tech-rich Nasdaq Composite Index tumbled 2.4 per cent to 11,264.45. The broad-based S&P 500 also fell, losing 0.8 per cent to 3,941.48, while the Dow Jones Industrial Average climbed 0.2 per cent to 31,928.62

Top gainers & losers




The Singapore economy expanded by 3.7 per cent year on year in the first quarter of 2022, with uplift from the manufacturing, finance and insurance, and professional services. Still, the external demand outlook “has weakened compared to 3 months ago”, the Ministry of Trade and Industry (MTI) said in a statement on Wednesday morning (May 25). The MTI has kept its full-year growth forecast of between 3 per cent and 5 per cent, but added that the print is “likely to come in at the lower half of the forecast range”. The ongoing Russian war in Ukraine and potential escalation of the conflict were identified as key downside risks for the economy, alongside deteriorations in the Covid-19 pandemic, as well as the possibility of faster-than-expected monetary policy tightening in advanced economies. As such, the ministry flagged a softer outlook for some outward-oriented sectors, such as the chemicals cluster, wholesale trade, and water transport, amid risks such as an economic slowdown in China and prolonged supply disruptions and port congestions worldwide. The latest growth in gross domestic product (GDP) growth – while easing from 6.1 per cent in the final 3 months of 2021 – is higher than earlier official flash estimates of 3.4 per cent, as manufacturing, construction and services all outperformed advance data.

Keppel Offshore & Marine’s (O&M) wholly-owned subsidiaries have signed contracts for the bareboat charter of 2 KFELS B Class rigs. In a press statement on Tuesday (May 24), Keppel Corp said the jackup rigs will be chartered to “an established drilling company” in the Middle East for deployment in the fourth quarter of 2022 for 3 years, with options for a year’s extension. Including the options for extension and modification works to prepare the rigs for on-site preparations, total revenue for the charters is expected to be up to S$120 million. The 2 rigs to be used for these charters will be from previously-terminated newbuild rig contracts with certain customers of Keppel O&M. The rigs and their bareboat charter agreements are part of the O&M unit’s legacy rigs. These latest contracts follow on the heels of another 2 bareboat charters by Keppel O&M announced by the group earlier in May.

City Developments Limited (CDL) on Tuesday (May 24) posted a 41 per cent year-on-year drop in homes sold for the 3 months ended Mar 31, the first full quarter since cooling measures were implemented in December last year. The mainboard-listed property developer and its joint-venture associates sold 188 units with a total sales value of S$477.9 million for Q1, versus 319 units with a total sales value of S$513.6 million a year ago, CDL said in a business update for its first quarter. While the cooling measures have impacted transaction volumes momentarily, the group foresees the property market to “remain resilient and housing prices to hold firm due to moderate supply and strong underlying fundamentals“. CDL’s latest launch, Piccadilly Grand, a joint venture with MCL Land, saw strong take-up when it was marketed in May. Some 315 units or 77 per cent of the Farrer Park project’s 405 apartments were sold on launch weekend at an average of S$2,150 per square foot.


US new home sales plunged 16.6 per cent in April, even as prices continued to climb, according to government data released on Tuesday (May 24). Sales of new single-family homes fell to an annual rate of 591,000, seasonally adjusted, with declines seen nationwide, the Commerce Department reported. The result was far worse than analysts had projected, and compounded by the downward revision to the sales figures for March. Last month’s sales pace was a 26.9 per cent drop compared to April 2021, the report said. However, even amid the rise in borrowing costs that is cooling demand from homebuyers, prices continued to rise in April, reaching a median of US$450,600 from US$435,000 in the prior month. Home sales have been booming throughout the Covid-19 pandemic helped by the popularity of working from home and increased household savings, which prompted many families to move out of congested urban areas and purchase larger houses.

Snap cut its revenue and profit forecasts below the low end of its previous guidance, sending shares plunging as much as 31 per cent and pushing other social media stocks down. The company will also slow hiring, filling 500 roles before the end of the year, chief executive officer Evan Spiegel said in a note to staff. Snap benefited from a surge in usage of its Snapchat app during the pandemic when people were looking for entertainment and connection from their homes. Now, as people return to offices and schools, the company is reeling from the same combination of economic pressures that are also facing its competitors. “The macroeconomic environment has deteriorated further and faster than anticipated,” Snap said in a filing. “As a result, we believe it is likely that we will report revenue and adjusted Ebitda below the low end of our Q2 2022 guidance range.” The company’s second-quarter forecast, for 20 to 25 per cent year-over-year revenue growth, was already below analysts’ estimates. The warning immediately hit other companies reliant on advertising, including Meta Platforms, Twitter, Alphabet and Pinterest.

Tesla shares struggled Tuesday (May 24) as the electric-vehicle maker’s production woes in China refuse to go away, leading another analyst to slash his 12-month price target on the once high-flying stock. “With about 13,000 units of production per week and higher than average margins, any production loss at Shanghai is bound to have a significant impact on margins and earnings,” said Daiwa analyst Jairam Nathan, who cut his price target to US$800 from US$1,150. Until recently, Tesla was considered the ultimate growth stock, rising 50 per cent last year and closing at US$1,145 on Apr 4, when CEO Elon Musk announced his 9.2 per cent stake in Twitter. Since then, Musk has been engaged in a highly public attempt to buy the social media platform. And Tesla’s stock has been in a freefall, sinking to US$620.57 at its lowest on Tuesday and wiping out almost half its market capitalisation after touching a record high in November. Since Musk revealed his Twitter stake, Tesla shares have plunged 42 per cent compared with a 13 per cent decline in the S&P 500 Index and a 26 per cent drop in the S&P 500 consumer discretionary sector. It’s the seventh-worst performing stock in the S&P 500 over that time and the third-biggest drag in terms of index points.

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

POEMS Podcast: Let the Money Talk


Recent Podcasts:

Money Never Sleeps – Ep 9

SGX Company Insights Ep 51 – Keppel DC REIT

SGX Company Insights Ep 50 – Keppel Corporation and Sembcorp Marine


Visit www.stocksbnb.com to view our research reports!



Join our Phillip Securities Research Telegram channel for the latest update on our stock coverage!

Click the link to join: https://t.me/stocksbnb

HK Reports – Read up on our Hong Kong reports here



Weekly Market Outlook: Sea Ltd, CLI, MUST, Prime US REIT, BRC Asia, LHN, UMS Holdings & More…

Date: 23 May 2022

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 minutes: #29 – Keppel Corporation; Initiation

Click here for more videos on Phillip in 3 Mins

For any research-related matters, email: research@phillip.com.sg

For general enquiries, email: talktophillip@phillip.com.sg
or call 6531 1555.

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


The information contained in this email is provided to you for general information only and is not intended to create any binding legal relation. The information or opinions provided in this email do not constitute investment advice, a recommendation, an offer or solicitation to subscribe for, purchase or sell any investment product. 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 should obtain advice from a financial adviser before making a commitment to invest in any investment product or service. In the event that you choose not to obtain advice from a financial adviser, you should assess and consider whether the investment product or service is suitable for you before proceeding to invest.

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.



    POEMS 3 App



    Call Back



    Chat with us

Contact us to Open an Account

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


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