Daily Morning Note – 25 November 2021
The Straits Times Index (STI) was little changed on Wednesday (Nov 24), ending 0.01 per cent or 0.38 point lower at 3,227.15. Advancers outnumbered decliners 243 to 210, with 1.64 billion shares worth S$1.03 billion changing hands. Across Asia, most markets also closed lower, amid investor concerns that the US Federal Reserve might speed up policy tightening to cope with broadening inflationary risks.
Wall Street stocks finished mostly higher on Wednesday following a heavy load of mostly solid economic data while some leading retail firms plunged on disappointing results. The deluge of economic releases ahead of Thursday’s Thanksgiving holiday showed jobless claims hitting their lowest level since 1969, while consumer income and spending both rose more than expected. The broad-based S&P 500 gained 0.2 per cent to 4,701.46, just a few points shy of an all-time record. The tech-rich Nasdaq Composite Index gained 0.4 per cent to 15,845.22, while the Dow Jones Industrial Average lost less than 0.1 per cent at 35,804.38.
Watch-listed SMI Vantage is acquiring 3,000 crypto mining machines from NBTC Limited, a wholly-owned subsidiary of China-headquartered tech firm The9, in a deal amounting to 3.3 million yuan, or S$705,000 (according to the agreed exchange rate of S$1.00 to 4.68 yuan). The purchase order was issued via SMI Vantage’s wholly-owned subsidiary SMI CS on Wednesday (Nov 24), and comes a week after SMI Vantage and Nasdaq-listed The9 signed a pact to explore developing a non-fungible token (NFT) publishing business. Under the order, the purchase consideration may be satisfied either by payment to NBTC in cash, or through the issuance of 7.83 million of SMI Vantage’s new ordinary shares to The9, at the issue price of S$0.09 per share, credited as fully paid-up, amounting in aggregate to the value of the purchase consideration, subject to shareholders’ approval. The issue price of S$0.09 represents a 10 per cent discount to the volume weighted average price of S$0.10 per share for the last 30 full market days on which they were traded on the mainboard.
Property player LHN has applied to the Stock Exchange of Hong Kong to spin off and separately list the shares of LHN Logistics on the Catalist board of the Singapore Exchange, the company said in a bourse filing on Wednesday (Nov 24). A concurrent application was also made to the Singapore Exchange Securities Trading. Apart from the logistics business, which comes under LHN Logistics, the group houses 2 other business segments, centred on space optimisation and facilities management. All 3 segments are separate and distinct.
The Monetary Authority of Singapore (MAS) has called the two-day service disruption at DBS a “serious” one and expects the bank to conduct a thorough investigation to identify the root causes. “MAS expects all financial institutions to have systems and processes to ensure the consistent availability of financial services to their customers,” said Marcus Lim, MAS assistant managing director (banking and insurance), in a statement on Wednesday (Nov 24) evening. “This is a serious disruption and MAS expects DBS to conduct a thorough investigation to identify the root causes and implement the necessary remedial measures.” The regulator will consider “appropriate supervisory actions” following the investigation. MAS said it was informed by the bank on Tuesday (Nov 23) that a problem with its access control servers has resulted in DBS/POSB customers experiencing difficulties accessing its digital banking services. While the disruption was initially resolved by 2 am on Wednesday, the issue recurred at around 10 am with over 700 outage reports made, data from Downdetector showed.
The number of Americans filing new claims for unemployment benefits fell to their lowest level since 1969 last week, pointing to sustained strength in the economy as a year marked by shortages and an unending pandemic winds down. Initial claims for state unemployment benefits tumbled 71,000 to a seasonally adjusted 199,000 for the week ended Nov 20, the Labor Department said on Wednesday. That was the lowest level since mid-November 1969. Economists polled by Reuters had forecast 260,000 applications for the latest week. Claims have been declining since October, though the pace has slowed in recent weeks as applications approach the pre-pandemic average of about 220,000. The report was published early because of the Thanksgiving holiday on Thursday.
US personal spending rose in October from a month earlier by the most since March, while a closely watched inflation measure posted the largest annual increase in three decades. Purchases of goods and services, unadjusted for changes in prices, increased 1.3 per cent following a 0.6 per cent gain in September, Commerce Department figures showed Wednesday. After adjusting for higher inflation, spending rose a healthy 0.7 per cent. The personal consumption expenditures price gauge, which the Federal Reserve uses for its inflation target, rose 0.6 per cent from a month earlier and 5 per cent from October 2020. The figures come as some Fed officials are advocating for a faster tapering of the central bank’s asset-purchase programme than initially planned. The US economy’s main growth engine – American consumers – continues to power ahead. Still, the robust demand, especially for merchandise, is further straining supply chains and helping to drive consumer price gains to the highest in decades. The median estimate in a Bloomberg survey of economists as for a 1 per cent monthly advance in personal spending. The PCE price index was expected to rise 5.1 per cent from a year earlier.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, CNBC, PSR
Technical Pulse: China Suntien Green Energy Corp ltd
Recommended: Technical buy; Analyst: Chua Wei Ren
China Suntien Green Energy (HKEX: 956) (A) (B) (C) corrective wave has come to an end after technicals indicate a bullish rebound is brewing
Buy spot: 5.78 Stop loss: 4.50 Take profit 1: 7.00 Take profit: 8.50
Technical Pulse: Genscript Biotech Corp
Recommended: Technical BUY; Analyst: Chua wei Ren
Genscript Biotech Corp (HKEX: 1548) Technicals are showing a bullish return after a brief period of consolidative range from July to October 2021
Buy stop: 37.70 Stop loss: 34.00 Take profit 1: 40.70 Take profit: 46.50
Technical Pulse: Power Asset Holdings ltd
Recommended: Technical BUY; Analyst: Chua Wei Ren
Power Asset Holdings Ltd (HKEX: 6) has finally seen the light at the end of the tunnel after a long downtrend between July and October 2021
Buy stop: 48.00 Stop loss: 46.00 Take profit 1: 50.50 Take profit: 52.30
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Weekly Market Outlook: Keppel Corp, UMS Holdings, UG Healthcare, Hyphens Pharma, Q&M Dental Group…
Date: 22 November 2021
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Phillip Research in 3 minutes: #29 Keppel Corporation; Initiation
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