Daily Morning Note – 31 January 2018


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Technical Analysis: S&P 500 Index – Monthly recession tracker
Analyst: Jeremy Ng
– None of our recession indicators are flashing red
– Broad-based equity market should continue to stair-step higher, with the 20
and 60 day moving average acting as the springboard
– Despite the recent flattening of the yield curve, the 2s10s spread still suggests
another 6 – 8 more months of further flattening before the yield curve inverts
– General equity market should continue to grow for another 6 – 8 more

Micro-Mechanics (Holdings) Ltd – Record quarter but a deceleration in momentum
Recommendation: Accumulate (Downgrade), Last Close Price: $2.39
Target Price: S$2.50, Analyst: Paul Chew
– 2Q18 revenue and PATMI were below expectation. We are reducing our
earnings forecast by 7% for FY18e.
– The weak USD partly hurt top-line momentum in the 2Q18.
– As our target price is unchanged at S$2.50 and the share price is up 18% since
our last report, we are downgrading our recommendation to ACCUMULATE.


Hang Seng Index – Daily timeframe – Bearish
– The bearish follow through on 30/01/18 brought the RSI back below the 70
overbought region suggesting the start of the mean reversion (correction).
– The 33,484 points formed on 29/01/18 could be the near-term top for now
where price enters into a period of correction.

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


CFM Holdings Ltd. expects to show an improvement of loss/record a marginal profit after tax for 1H18, mainly due to increase in revenue because of higher demand from customers for metal stamping operations and cleanroom products, lower depreciation expenses, decrease in staff costs and professional expenses.

Singapore O&G Ltd. announced the resignation of its CEO Nr Ng Koon Keng.

Sunpower Group Ltd. has won a tender worth approximately RMB30.9 million to provide Flue Gas Desulphurization (FGD) Engineering, Procurement and Construction (“EPC”) services.

Datapulse Technology Ltd. announced the resignation of CEO Mr Kee Swee Ann due to medical reasons.

QAF Ltd. reported an ammonia leak at one of the Group’s warehouse at Fishery Port Road. The warehouse is used by the Group’s subsidiary, Ben Foods (S) Pte Ltd for storage of food and beverage products.

Source: SGX Masnet, PSR

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

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