DAILY MORNING NOTE | 31 January 2024

Trades Initiated in the past week


Singapore shares ended higher on Tuesday (Jan 30), mirroring overnight gains over in the US market. Singapore stocks were up 0.3 per cent or 9.73 points to 3,150.04. Across the broader market, losers outnumbered gainers 333 to 251, after 1.6 billion securities worth S$1.1 billion changed hands. The Hang Seng Index fell 2.3 per cent, the Kospi Composite Index lost 0.1 per cent, and the FTSE Bursa Malaysia KLCI ended 0.2 per cent lower. Meanwhile, the Nikkei 225 gained 0.1 per cent.

US stocks finished mixed on Tuesday (Jan 30) ahead of the Federal Reserve’s interest rate decision, where traders and analysts will be looking for clues on when the central bank could start cutting rates. The Fed is almost certain to keep its key lending rate on hold Wednesday for a fourth straight meeting, as it continues its fight to return inflation to its long-run goal of 2 per cent. On Wall Street, the Dow Jones Industrial Average rose 0.4 per cent to finish the day at 38,467.31. The broad-based S&P 500 slipped 0.1 per cent to 4,924.97, and the tech-rich Nasdaq Composite fell 0.8 per cent to 15,509.90.

Top gainers & losers


Events Of The Week



Keppel Pacific Oak US Reit’s portfolio valuation as at Dec 31, 2023, fell 6.8 per cent to US$1.3 billion, from US1.4 billion previously, based on the latest independent valuation. This comes as the real estate investment trust’s (Reit) manager announced that its financial results for the second half and full year ended Dec 31, 2023, will be released at a later date. Its results were originally set to be released on Jan 31. The manager said in a separate bourse filing on Tuesday (Jan 30) that four of the Reit’s 13 properties – The Plaza Buildings, Westmoor Centre, Bellevue Technology Centre and Iron Point – contributed to approximately 84 per cent of the portfolio’s valuation decline.

Frasers Logistics & Commercial Trust (FLCT) leased 128,000 sq m of space across its portfolio in the first quarter ended Dec 31, with a portfolio occupancy rate of 95.8 per cent. The leased space includes the 62,000 sq m lease at the newly completed Ellesmere Port in North West England in the UK, FLCT said in a business update on Tuesday (Jan 30). For Q1, FLCT recorded positive rental reversions of 11.6 per cent on an incoming versus outgoing basis, and 18.2 per cent on an average versus average basis. The “positive leasing momentum” has reduced FY2024 expiries from 8.7 per cent as at Sep 30, 2023, to 7 per cent as at Dec 31, it added.

Singtel is not exploring transactions that involve the enterprise business of its Australian unit Optus, it said in response to a report by the Australian Financial Review (AFR). “No transaction relating to the Optus enterprise business is currently being contemplated,” Singtel said in a bourse filing late on Tuesday (Jan 30) evening. Earlier in the day, the AFR published a report titled Singtel weighs options for Optus; eyes on enterprise division. The article said, citing sources, that Optus executives have considered divestments over the past two years to help Singtel take some money off the table, and that one option is divesting Optus’ enterprise and business division.


Oil prices rose on Tuesday (Jan 30) as a higher global economic growth forecast and escalating tensions in the Middle East offset concerns around Chinese demand. March Brent crude futures, which expire on Wednesday, rose 47 US cents to settle at US$82.87 a barrel. The more active April contract settled up 67 US cents at US$82.50. US West Texas Intermediate crude settled up US$1.04, or 1.35 per cent, at US$77.82.

Microsoft shares moved 2% lower in extended trading on Tuesday after the software maker issued fiscal second-quarter results that outdid analysts’ estimates. Microsoft’s revenue increased 17.6% year over year in the year, which ended on Dec. 31, according to a statement. Net income, at $21.87 billion, or $2.93 per share, increased from $16.43 billion, or $2.20 per share. The company’s Intelligent Cloud segment produced $25.88 billion in revenue, up 20% and above the $25.29 billion consensus among analysts surveyed by StreetAccount. Within that segment, revenue from Azure and other cloud services grew 30%. Analysts polled by CNBC had expected 27.7% growth, and the StreetAccount consensus was 27.5%. The metric for the previous quarter was 29%.

Alphabet shares slid more than 6% in extended trading on Tuesday after the company reported ad revenue that missed analysts’ estimates. Alphabet reported its fastest quarter for revenue growth since early 2022, with sales climbing 13% from $76.05 billion a year earlier, the company said in a statement. However, ad revenue of $65.52 billion trailed analyst estimates of $65.94 billion, according to StreetAccount. YouTube, which has been helping to drive accelerated growth, came in just shy of expectations. Google Cloud remains a growth engine, with 26% expansion in the fourth quarter compared to a year ago. Net income jumped 52% in the fourth quarter to $20.7 billion, or $1.64 per share, from $13.6 billion, or $1.05 per share, a year earlier.

Chipmaker Advanced Micro Devices forecast first-quarter revenue below Wall Street estimates on Tuesday, but projected strong sales for its artificial intelligence (AI) processors. Revenue for the fourth quarter came in at $6.17 billion versus the consensus estimate of $6.12 billion. The data center segment revenue, which includes its AI server chips, grew 38% from a year ago to $2.3 billion. Net income in the fourth quarter was $667 million, or $0.41 per share, versus $21 million, or $0.01 per share a year ago. For the first quarter, AMD said it expects about $5.4 billion in sales, plus or minus $300 million, while analysts were looking for revenue of $5.73 billion. AMD added that it expected some of its major businesses, including PC chips, to decline sequentially during the quarter. It said that its data center revenue would be flat as server CPU declines would be offset by AI GPU sales. AMD forecast $3.5 billion worth of AI chip sales in 2024, above its prior forecast of $2 billion.

Payments firm PayPal Holdings is planning to cut about 2,500 jobs, or 9 per cent of its global workforce, this year, a letter from CEO Alex Chriss, seen by Reuters, showed on Tuesday (Jan 30). In the letter to staff, newly appointed CEO Chriss said the decision was made to “right-size” the company through both direct cuts and the elimination of open roles throughout the year. The staff that will be affected are expected to be notified by the end of the week.

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


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