Daily Morning Note – 31 March 2020
WEEKLY MARKET OUTLOOK WEBINAR
PHILLIP SUMMARY
Asian stocks looked set to rise after a rally in their U.S. counterparts, as investors saw glimmers of optimism in efforts to deliver rapid testing for the new coronavirus. The dollar climbed. Futures pointed higher in Japan, Australia and Hong Kong on the last trading day of the quarter. S&P 500 futures were little changed after the index climbed for the fourth time in five days with health-care shares among the biggest gainers.
Crude clawed back some losses after falling more than 5%. The 10-year Treasury yield rose, while gold dipped. Global equities are on track to round out their worst quarter since the last three months of 2008 as investors grapple with the economic impact of the coronavirus spread.
BREAKING NEWS
ComfortDelgro Taxi announced on Monday it was extending its daily rental relief until September to hirers affected by the COVID-19 outbreak. Hirers currently receive a total of S$46.50 per taxi per day in rental relief, which comprises S$36.50 from the the company and S$10 from the Government’s Special Relief Fund.
Five Singapore and two Japanese companies on Monday signed a memorandum of understanding (MOU) to develop ways to use hydrogen as a low-carbon energy source in the city-state. The seven companies are: PSA Corporation, Jurong Port, City Gas, Sembcorp Industries, Singapore LNG Corporation, Chiyoda Corporation and its main shareholder, Mitsubishi Corporation.
Visa Inc said on Monday its transaction volumes had been hit as the coronavirus pandemic wreaks havoc on consumer spending, leading it to forecast mid-single digit percentage revenue growth for the second quarter. “As countries have imposed social distancing, shelter-in-place or total lock-down orders, domestic spending, most notably in travel, restaurants, entertainment and fuel, has sharply declined week on week,” the said in a statement. The company said transaction volumes fell in the second half of March and there has been a rapid deterioration in cross-border travel-related spending.
South Korea’s factory output contracted at its sharpest pace in more than 11 years in February, official data showed on Tuesday (March 31), adding to evidence of a sharp economic blow from the coronavirus pandemic. Industrial output shrank by a seasonally adjusted 3.8 per cent in February from a month earlier, worse than a 1.8 per cent fall tipped in a Reuters survey and the biggest drop since a 10.5 per cent plunge in December 2008. It shrank 1.3 per cent in January. On a year-on-year basis, the factory output jumped 11.4 per cent, far better than a 2.6 per cent fall in January. The virus impact is expected to weigh further as the number of infections spiked across the world in March.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, PSR
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Market Outlook: (PSR) City Development Limited, CapitaLand Limited, Dasin, EC World, REITS & Banking Monthly, SG Weekly & Technicals
Date: 16 March 2020
Phillip Research in 3 minutes: #19 – Singapore Banking Sector Update
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