Daily Morning Note – 31 March 2021

PHILLIP SUMMARY

Most Asian stocks look set to gain on the last trading day of the quarter as investors look to more U.S. stimulus, while wary of upward pressure on bond yields. Rates on the U.S. 10-year benchmark touched a 14-month high. Futures rose in Australia and Hong Kong, and dipped in Japan. The dollar strengthened for a second day and gold slipped below $1,700 per ounce to multi-month lows. Oil halted a two-day rally before the April 1 meeting of OPEC and its allies.


BREAKING NEWS

SG

Soilbuild Business Space Reit’s (Soilbuild Reit) trust scheme of arrangement has been sanctioned by the court on March 30, the Reit’s manager said in a Singapore Exchange filing on Tuesday night. As the trust scheme court order has been granted, trading in Soilbuild Reit units has been suspended for the purposes of determining the entitlements of unitholders, as at the record date of March 30. In Soilbuild Reit’s indicative timeline, the disposal of its Australian assets – in conjunction with the trust scheme – is expected to be completed on March 31. The adjusted scheme consideration is expected to be paid to unitholders on April 12, and Soilbuild Reit units are expected to be delisted on April 14.

Sembcorp Industries unit Sembcorp Development will be involved in the development of a new industrial park in Vietnam’s Quang Tri province, Sembcorp Industries said in a Singapore Exchange filing on Tuesday night. The investment licence for the Quang Tri Industrial Park project has been issued to a consortium that includes Vietnam Singapore Industrial Park Joint Venture Co, a joint venture between Sembcorp Development and long-standing partner Becamex IDC Corporation.

Neo Group founder, chairman and chief executive officer Neo Kah Kiat intends to take the Catalist-listed food caterer private via a voluntary conditional cash offer at S$0.60 per share, the firm announced on Tuesday after market close. The offeror, Forestt Investment, was incorporated for the purpose of the offer, with its directors being Mr Neo and Neo Group executive director Liew Oi Peng.

Singapore Press Holdings (SPH) had on Tuesday posted a 26.1 per cent increase in net profit to S$97.9 million for the half year ended Feb 28, due to improvements in its non-media business segments as the economy recovers gradually. Operating profit rose 16.6 per cent to S$119.8 million despite a 11.5 per cent dip in operating revenue to S$417.1 million. SINGAPORE Press Holdings is undergoing a strategic review “to consider options for its various businesses”, the firm announced on Tuesday after market close. SPH said it will make further announcements as appropriate, and advised shareholders to exercise caution when dealing in its shares.

Catalist-listed GKE Corp has been granted a farm licence for its wholly-owned subsidiary GKE Agritech to grow and sell agricultural produce commercially in Singapore. In a press statement on Tuesday, the integrated warehousing and logistics solutions provider said it received approval from the Singapore Food Agency for its farm licence application on March 27.

Top Glove, the world’s biggest rubber glove manufacturer, was again rapped by the US Customs and Border Protection (CBP) on March 29 after it discovered forced labour practices in the company’s production of disposable gloves. Under CBP’s direction, disposable gloves manufactured in Malaysia by Top Glove arriving at all ports of entry in the US were seized.

US

Lululemon on Tuesday reported revenue and profit for the fiscal fourth quarter that topped analysts’ estimates, boosted by the athletic apparel maker’s online business, and double-digit sales growth in both its women’s and men’s divisions. Lululemon reported net income of $329.8 million, or $2.52 per share, compared with net income of $298 million, or $2.28 per share, a year earlier. Excluding one-time items, the company earned $2.58 per share, better than the $2.49 expected by analysts.

Macy’s CEO Jeff Gennette told CNBC on Tuesday the uptick in U.S. Covid-19 vaccinations is already having a positive effect on the company’s top line. Gennette said business from loyal Macy’s customers is already up by 10% from the company’s fiscal fourth quarter, which ended in late January. Macy’s is just two months its current fiscal quarter.

Billionaire restaurateur and casino operator Tilman Fertitta told CNBC on Tuesday he’s been caught off guard by the strength of his businesses in March. His comments on “Power Lunch” offer further insight into consumer confidence in the U.S. economy as states roll back pandemic-era restrictions and more Americans are vaccinated against Covid. “Our numbers in March are surprising to us in all 40 states that we do business in,” said Fertitta, chairman and CEO of Houston-based Landry’s, whose restaurants include Joe’s Crab Shack and Morton’s The Steakhouse. Fertitta also owns the Golden Nugget brand of casinos and hotels.

Trading in the new space exploration ETF from Ark Invest began on Tuesday, as Cathie Wood’s firm looks to tap the growing space industry. “Space is already an invisible backbone to our economy and we think that’s only going to become more so as [satellite] constellations launch,” Ark Invest analyst Sam Korus told CNBC’s Morgan Brennan on “Power Lunch.” Shares of ARKX slipped about 1% in its first day of trading, with the stock closing at $20.30 a share.

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

TECHNICAL REPORTS

Ascendas REIT

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Ascendas REIT (SGX: A17U) has been on a prolong correction since August 2020. Based on the recent technical, the stock is poised to break further on the upside.

Japfa Ltd

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Japfa Ltd (SGX: UD2) upside is set to continue based on the recent technical.

>> Read more Technical reports

HK Reports – Read up on our Hong Kong reports here

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