Daily Morning Note – 29 May 2020

PHILLIP SUMMARY

Asian stocks looked set for a mixed open Friday after a rally in U.S. equities fizzled on fresh U.S.-China tensions. The dollar retreated. Futures were little changed in Japan, slipped in Australia and edged higher in Hong Kong. The S&P 500 gave up a gain of more than 1% on the announcement, with investors speculating the action could destabilize the global economy, although the precise agenda was unclear. Treasuries were steady and crude oil gained. European stocks ended higher amid optimism over economies reopening and an EU fiscal stimulus plan.

BREAKING NEWS

Singapore conglomerate Keppel Corp has unveiled a 10-year roadmap that sharpens the lens on four key segments from offshore & marine to property and grow the units as an integrated business with an eye on M&A plus divestments of selected assets. Under Vision 2030, which took a year in the making and was completed last month, the diversified firm has redefined its businesses into energy and environment, urban development, connectivity and asset management.

Telcos are facing slow payments or alternative arrangements. The telcos have indicated that they are taking a long-term view and trying to keep loyal customers – a strategy that industry watchers approve of. Singtel flagged slower payments from customers in its results briefing on Thursday. Rival StarHub said it has introduced “alternative payment plans for select customers” keeping an eye on the situation and “continue providing an appropriate level of assistance to severely-affected businesses and consumers”, a spokesperson told The Business Times. Keppel-owned M1, meanwhile, has rolled out an automatic bill rebate for mobile users living in one- and two-room public housing. It has also extended payment deadlines and introduced instalment payment plans.

Monies that were originally intended for Eagle Hospitality Trust’s (EHT) maiden distribution to unitholders will now be re-directed to fund critical expenses of the US-based hotel trust and its underlying portfolio. This is in the light of the “continuing failure” by the trust sponsor and master lessee, Urban Commons, to discharge its obligations under the Master Lease Agreements (MLAs), EHT said in a filing to the Singapore Exchange on Wednesday night.

Singapore’S top court ruled in favour of a claim by Noble Group Ltd’s former CEO Ricardo Leiman to millions of unpaid shares, overturning an earlier ruling while upholding that he wasn’t entitled to his bonus. The Court of Appeal allowed the appeal in “large part”, and ordered an assessment of damages after ruling that Noble deprived Mr Leiman of entitlements including the right to exercise share options, according to a copy of the judgment seen by Bloomberg. The court said he wasn’t in breach of contractual non-competition and confidentiality obligations, also overruling an earlier decision.

The Securities Investors Association (Singapore), or SIAS has called on Hyflux to immediately clarify key aspects of Utico’s revised rescue deal, which the investor watchdog dubbed a “bombshell” for holders of Hyflux’s Perpetual securities and Preference shares (PnPs). In a statement on Thursday, SIAS chief executive David Gerald noted that Utico’s latest offer to the PnPs is that their holders will receive shares comprising 5 per cent of Utico and 12.5 per cent of Hyflux as payment, but with no cash component. This offer is valid only until June 4.

Bukit Sembawang posted a S$14.2 million loss for the fourth quarter ended March – 23 per cent deeper in the red than a year ago due to steeper operating costs, the property developer announced in a bourse filing on Thursday. For the full year, it posted a 25 per cent drop in net profit to S$76.1 million, while revenue inched up 3 per cent to S$369.7 million. Bukit Sembawang has proposed a special dividend payout of seven cents per share, less than half of last year’s 18 cents per share special dividend. It also proposed a final dividend of four cents per share, unchanged from a year ago.

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

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