Daily Morning Note – 26 November 2021
Local stocks ended Thursday in the red as traders approached markets cautiously. Notable factors that weighed on investor sentiment were inflation levels that could exceed forecasted levels, as well as a faster tapering by the US Federal Reserve. The benchmark Straits Times Index fell 0.2 per cent or 5.63 points to wrap Thursday’s trading session at 3,221.52. The daily turnover came in at some 1.3 billion securities worth S$944.7 million. Decliners outpaced advancers 235 to 208.
Daiwa House Logistics Trust (DHLT), a real estate investment trust (REIT) that will invest in logistics and industrial real estate assets across Asia, on Thursday (Nov 25) announced that the public offer of 25 million units to Singapore investors under its initial public offering (IPO) was 9.5 times subscribed. At the close of the offering at noon on Wednesday, 7,543 valid applications for 237 million units were received for the Singapore public offer. The international placement tranche of over 219.4 million units at the offer price of S$0.80 apiece was 4.9 times subscribed.
Coffee shop and food court operator Kimly reported a 55.7 per cent growth in net profit to S$39.3 million for the full year ended Sep 30, 2021. This comes on the back of an increase in revenue across the board, up 13.2 per cent to S$238.6 million, the group said in a bourse filing on Thursday (Nov 25). The group has proposed a final dividend of 0.84 Singapore cents per share and a special dividend of 0.6 Singapore cents per share. Taking into consideration the 0.56 Singapore cents per share interim dividend paid in July 2021, the total dividend declared for FY2021 stands at 2 Singapore cents per share.
Keppel Offshore & Marine (Keppel O&M) has been awarded work worth around S$200 million for the conversion of a floating storage and regasification unit, and the integration of a floating production storage and offloading vessel, Keppel Corporation said in a statement on Thursday (Nov 25). For the first project, Keppel Shipyard, a wholly-owned subsidiary of Keppel O&M, has signed a limited notice to proceed with a global provider of LNG (liquefied natural gas) shipping services to start works to convert an LNG carrier into a floating storage and regasification unit. The scope of the deal includes engineering work starting in Q4 2021. The full notice to proceed for the remainder of the work is expected within Q1 2022, when the project reaches final investment decision. For the second project, Keppel Shipyard has received a letter of award from BW Offshore, a fully-owned subsidiary of the BW Group, for integration work on a newbuild floating production storage and offloading vessel. The contract is expected to be signed by early 2022. Keppel Shipyard will be responsible for the integration of about 35,000 tons of topside modules and a turret, with additional options available to build new structures, such as a flare tower.
The US dollar slipped on Thursday (Nov 25) but was still close to its highest since July 2020 against the euro, having strengthened due to market expectations that the US Federal Reserve will raise rates sooner than other major central banks. Minutes from the Fed’s Nov 2-3 meeting boosted the US dollar on Wednesday as they indicated the Fed had become more concerned about rising inflation. Various policymakers said they would be open to speeding up the taper of their bond-buying programme if high inflation held and move more quickly to raise interest rates. Data on Wednesday showed that US jobless claims were at a 52-year low, consumer spending increased more than expected in October and inflation was rising. But on Thursday the greenback’s upward trend – which has seen it gain around 2.7 per cent this month – paused slightly, with the dollar index down 0.1 per cent at 96.707 at 1242 GMT, compared to the 16-month high of 96.938 it reached late on Wednesday.
Oil prices dipped in thin trading on Thursday, the US Thanksgiving holiday, as investors eyed how major producers respond to the US-led emergency oil release designed to cool the market and with Opec now expecting the release to swell inventories. Brent crude futures had slipped 8 cents, or 0.1 per cent, to US$82.17 a barrel by 1.02 pm ET (1802 GMT). US West Texas Intermediate (WTI) crude futures fell 36 cents, or 0.5 per cent, to US$78.03 a barrel. OPEC expects the US release to swell a surplus in oil markets by 1.1 million barrels per day (bpd), a source from the group said. The Organization of the Petroleum Exporting Countries, Russia and allies, together called Opec+, will meet on Dec 1-2 to set policy.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, CNBC, PSR
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