DAILY MORNING NOTE | 30 January 2024

Trades Initiated in the past week

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Singapore stocks ended lower on Monday (Jan 29), bucking gains in the region. Singapore stocks fell 0.6 per cent or 19.22 points to 3,140.31. Across the broader market, losers outnumbered gainers 279 to 270, after 1.4 billion securities worth S$961.7 million changed hands. The Hang Seng Index gained 0.8 per cent, the Nikkei 225 was up 0.8 per cent, the Kospi Composite Index rose 0.9 per cent, and the FTSE Bursa Malaysia KLCI Index climbed 0.6 per cent.

The Dow and S&P 500 notched fresh records on Monday (Jan 29), with the buoyant session kicking off a heavy news week that includes tech titan earnings and a Federal Reserve interest rate decision. The Dow Jones Industrial Average rose 0.6 per cent to finish at 38,333.45, a third straight all-time high, while the broad-based S&P 500 returned to record territory with a 0.8 per cent gain to 4,927.93. The tech-rich Nasdaq Composite index climbed 1.1 per cent to 15,628.04.

Top gainers & losers

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Events Of The Week

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SG

Precision engineering company UMS Holdings raised S$51.6 million from a placement of 40 million new shares at S$1.29 per share. The shares were priced at a 6.9 per cent discount to the volume-weighted average price of S$1.3862 for trades done on Jan 25. The placement, with no underwriting, was 2.55 times covered, with participation from global and regional institutional investors as well as accredited investors. The placement proceeds will be used for future capital expenditure, working capital, potential investments, joint-ventures and acquisitions, UMS said on Monday (Jan 29). Following the placement, its share base will be enlarged by 5.97 per cent to just over 710.5 million shares.

Capitaland India Trust on Monday (Jan 29) reported a 21 per cent lower distribution per unit (DPU) for FY2023 of S$0.0645, compared to S$0.0819 in FY2022. DPU for the second half of FY2023 also fell 21 per cent to S$0.0309 from S$0.0391 in FY2022, said the trust in a bourse filing. Distributable income slipped 10 per cent in H2 FY2023 to S$45.7 million from S$50.6 million in H2 FY2022. FY2023 distributable income was down 10 per cent to S$94.6 million from S$105.7 million. The drop in distributable income was due to higher finance costs and current income tax. The enlarged unit base following the preferential offering as well as the appreciation of the Singapore dollar against the Indian rupee led to the fall in DPU.

Starhill Global Real Estate Investment Trust’s (Reit) distribution per unit (DPU) fell 2.2 per cent to S$0.0178 in the first half of FY2024 ended Dec 31, 2023, from S$0.0182 a year earlier, its manager said on Monday (Jan 29). The fall in DPU was in tandem with the fall in income available for distribution, which fell 3.8 per cent to S$41.9 million in H1 FY2024 from S$43.6 million in H1 FY2023. This was driven by higher net finance costs and a one-off leasing commission fee for a master lease renewal with Toshin, the speciality store manager of Takashimaya at Ngee Ann City.

Mapletree Logistics Trust has entered into a purchase agreement with an unrelated third party to divest its 73 Tuas South Avenue 1 property for S$16.8 million, it announced on Monday (Jan 29). JTC Corporation has granted in-principle approval for the transaction subject to compliance to stipulated conditions by the parties. The sale price is 10.5 per cent above the latest valuation of S$15.2 million as at Jan 1 2024. The property is a 22-year-old four-storey cargo lift warehouse with an approximate net lettable area of 10,967 square metres.

Oue Reit’s distribution per unit stayed flat year on year at S$0.0104 for its second half ended Dec 31, 2023, its manager reported on Monday (Jan 29). This was even as the revenue of the real estate investment trust (Reit) rose 16.4 per cent on the year to S$146.3 million, from S$125.7 million previously. Net property income for the half year grew 15.9 per cent on the year to S$119.7 million, from S$103.3 million.


US

Amazon and robot vacuum maker iRobot said Monday (Jan 29) they would end their plans to merge in the face of opposition from EU antitrust regulators. iRobot announced a significant restructuring plan to reduce costs and said it would cut about 31 per cent of its workforce, or 350 jobs. The company also said founder Colin Angle has stepped down as its CEO. Angle said given the current challenges, he and the board “mutually decided that iRobot will be better served by a new leader with turnaround experience.” Amazon said its proposed US$1.4 billion acquisition of iRobot had no path to regulatory approval in the European Union.

Oil prices fell more than a US dollar a barrel on Monday (Jan 29) as China’s ailing property sector sparked demand worries, causing traders to reassess the supply risk premium from escalating tensions in the Middle East. Brent crude futures fell US$1.15, or 1.4 per cent, to settle at US$82.40 a barrel, while US West Texas Intermediate crude futures dropped by US$1.23, or 1.6 per cent, at US$76.78 per barrel. Both contracts settled lower for the first time in four sessions as attention shifted to demand concerns in China, where a real estate crisis deepened with a Hong Kong court ordering the liquidation of property giant China Evergrande Group.

Shares of Whirlpool Corp fell 5% in after-hours trading Monday after the company’s revenue guidance for 2024 missed Wall Street’s estimates. For Q4, Whirlpool reported earnings per share (EPS) of $3.85, topping the consensus projection of $3.54. Revenue came in at $5.09 billion, while analysts looked for $4.98 billion. The home appliance manufacturer generated $2.88 billion in North America net sales, up 1.3% year-over-year, but missing the expected $2.96 billion. Looking ahead, Whirlpool expects 2024 revenue of $16.9 billion, notably below the consensus estimates of $17.68 billion. Full-year EPS is anticipated to be in the range of $13 to $15, also missing Wall Street’s expectations of $15.34.

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


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