Daily Morning Note – 29 August 2018


Register HERE for MONDAY’s 11.15am webinar.

Archived webinars available.


U.S. stocks raised to new highs on Tuesday, while Treasury yields climbed as investors assessed the latest developments from the Trump administration’s trade policies. The U.S. and Mexico agreed on Monday to overhaul NAFTA, putting pressure on Canada to agree to new terms on auto trade and dispute settlement rules to remain part of a three-nation pact. But a previously unreported side agreement between the two countries would allow the United States to impose “national security” tariffs on annual Mexican car and SUV imports of over 2.4 million vehicles. The rally in emerging markets lost momentum, with the lira tumbling after Moody’s downgraded several Turkish banks.


Micro-Mechanics (Holdings) Ltd – Consumables provide resiliency

Recommendation: BUY (Maintained), Last Done Price: S$1.83

Target Price: S$2.30, Analyst: Paul Chew

– 4Q18 revenue and PATMI were 3% and 6% below our full-year expectations.
We are trimming our FY19e earnings by 14%.

– Margins hurt by higher depreciation (as capex more than doubled in FY18)
and weaker sales in Singapore and Malaysia.

– Despite lowering our earnings, we maintain our target price at S$2.30. We
believe Micro-Mechanics has the most resilient product line and a front-end
business could surprise on the upside.

CapitaLand Mall Trust Limited – Entrenching presence in the Jurong Lake District

Recommendation: NEUTRAL (Maintained), Last Done Price: S$2.15

Target Price: S$2.05, Analyst: Tan Dehong

– CMT to acquire remaining 70% stake in Westgate for S$790mn.

– Acquisition based on agreed market value of Westgate at S$1,128mn

– Recycling of capital from Sembawang Shopping Centre sale into newer asset
as 4.3% entry yield.

– Latest committed occupancy at 98% with a 99y lease tenure from 2011.

– Maintain NEUTRAL with unchanged target price of S$2.05.


SATS Ltd – Daily timeframe – Bullish

– The bullish rejection off the 5.04 support area succeeded in closing price back
above the 20 and 60 day moving average on 28/08/18 signals the bullish
momentum has returned.

– Expect price to head higher next to test the 5.30 resistance area followed by

For more information and additional disclosures, refer to the link here.


With US-South Korean military drills back on the table and the cancelation of a top-level summit in Pyongyang, Washington is toughening its stance as it negotiates with North Korea.

The United States this week blocked the reappointment of a judge at the World Trade Organization, increasing the risk that the global body could soon find itself unable to fulfil its key role in arbitrating trade disputes.

Ghana and Britain on Tuesday signed a £20 million (S$35.5 million) trade and investment agreement to create jobs and promote economic development in the west African nation, the Ghanaian presidency said.

mm2 Asia’s 51-per cent-owned subsidiary Vividthree Holdings (VVH) has entered into a restructuring agreement with mm2 Entertainment and four individual shareholders of Vividthree Productions (VVP) for the acquisition of the entire capital of VVP for S$50,000.

Capitaland’s group chief investment officer Lee Chee Koon will helm the property giant starting Sept 15, taking over from current president group chief executive Lim Ming Yan who gave notice to retire earlier this year in June.

Singapore and Hong Kong buyers have scooped up more than 20 out of 250 units at “well over S$3,000 per square foot” at 8 St Thomas in a private preview over the weekend, developer Bukit Sembawang Estates said in a statement on Tuesday.

Source: SGX Masnet, Bloomberg, Reuters, The Business Times, Channel NewsAsia, Phillip Securities Research

Clients of Phillip Securities can keep updated with Country Strategy and Singapore Sector Reports by logging into: www.poems.com.sg > STOCKS > Research

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 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 “as 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


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