Daily Morning Note – 27 May 2021
PHILLIP SUMMARY
US equities eked out modest gains on Wednesday after a lackluster session that saw positive corporate news dueling with lingering concerns over the global recovery and US inflation. Amazon announced a deal to acquire MGM studios, and major retailers reported an earnings surge fueled by cash-flush American consumers. The Dow Jones Industrial Average ended essentially flat at 34,323.05. The broad-based S&P 500 edged up 0.2 percent to close at 4,195.99, while the tech-rich Nasdaq Composite Index advanced 0.6 percent at 13,738.
BREAKING NEWS
SG News
Monetary Authority of Singapore (MAS) is joining the Mojaloop Foundation as a sponsor-level member – making it the first central bank to do so – to advance financial inclusion in emerging economies. This will be done via digital currency-based settlement systems and foundational digital infrastructure, MAS and the Mojaloop Foundation said in a joint release on Wednesday. The collaboration is also expected to deliver opportunities for fintech players in Singapore and the broader Asia-Pacific.
A-Sonic Aerospace is proposing a bonus issue of up to some 14.62 million warrants on the basis of one warrant for every four existing shares, which would see it raising gross proceeds of up to S$1.17 million. Each warrant will entitle the warrant holder to subscribe for one new share in the company at an exercise price of S$0.08, which is a discount of 88 percent to the last transacted price of S$0.665 per share on the Singapore Exchange (SGX) on May 25, the day before the announcement was made.
A unit of China Haida, CHD Engineering and Trading, has entered into a joint venture (JV) agreement with K-United Builder (KUB) to collaborate to supply and install aluminum products for projects in Singapore and Malaysia. The first project is for a commercial building in Johor, Malaysia with a contract value of S$1.68 million. Work will start on Aug 2 this year and is slated for completion on Dec 1, 2022. The scope of work is to supply aluminum cladding and roof work for a commercial building which is being erected in Iskandar Puteri, Johor.
Ntegrator International has entered into a conditional placement agreement to issue some 187.86 million new shares in the company as part of a proposed placement exercise to raise about S$2.06 million. At S$0.01094 per share, the subscription price is a discount of 9.96 percent to the weighted average price of S$0.01215 for trades done on the Singapore Exchange (SGX) on May 21, which was the last day on which the company’s shares were traded prior to the signing of the agreement.
US News
Exxon Mobil’s management will face a big challenge over its climate change policies at an annual shareholder meeting on Wednesday as activists contest the election of one-third of the company’s board. Analysts who follow the company said they could not recall an election in which board candidates nominated by Exxon had lost. A defeat for even one of its nominees would be a rebuke to Darren W Woods, Exxon’s chairman and chief executive.
China’s Xiaomi said on Wednesday a US court has removed the company’s designation as a Communist Chinese Military Company (CCMC) and lifted all restrictions on US persons buying or holding its stock. “The US District Court for the District of Columbia issued a final order vacating the US Department of Defense’s designation of the company as a CCMC,” the smartphone maker said in a filing to the Hong Kong bourse. It said the order was made on Tuesday.
Gold prices held firm near a 4-1/2-month high on Wednesday as a drop in US Treasury yields and a weaker dollar supported the safe-haven metal. Spot gold was steady at US$1,899.11 per ounce by 12.41am GMT, after hitting its highest since Jan 8 at US$1,899.11 on Tuesday. US gold futures edged 0.1 percent higher to US$1,899.60 per ounce.
Oil prices settled higher on Wednesday as a drop in US crude stockpiles reinforced expectations of improving demand ahead of the peak summer driving season, offsetting worries that a possible return of Iranian supply would cause a glut. Brent settled up 16 cents, or 0.3 percent, to US$68.87 a barrel and US West Texas Intermediate (WTI) crude settled up 14 cents, or 0.2 percent, at US$66.21 a barrel.
Wall Street bank chiefs will tout the role their institutions have played in getting the pandemic-hit US economy back on track when they appear before Congress this week, but are likely to face tough questions on hot-button social and economic issues.
Goldman Sachs Group received approval from Chinese regulators to set up a wealth management joint venture in the world’s second-largest economy to go after an asset pool it estimated will surpass US$70 trillion by the end of this decade. Goldman Sachs Asset Management will hold 51 percent in the venture, while the wealth arm of Industrial & Commercial Bank of China (ICBC), the world’s largest bank by assets, will own the remainder, the firms said on Tuesday.
Amazon Inc said on Wednesday it is buying MGM, the fabled US movie studio home to the James Bond franchise, for US$8.45 billion, giving it a huge library of films and TV shows and ramping up competition with streaming rivals led by Netflix and Disney+.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, CNBC, PSR
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