DAILY MORNING NOTE | 4 January 2024

Singapore shares fell for the second consecutive day on Wednesday (Jan 3), mirroring regional losses and an overnight decline on Wall Street. Across the broader market, losers outnumbered gainers 333 to 268, after 1.2 billion securities worth S$888.6 million were traded. Shares of Seatrium ended at the bottom of the index performance table after falling 4.2 per cent to close at S$0.115. The counter was the most actively traded by volume, with some 222 million shares worth S$26 million changing hands. The local banks also ended in the red. OCBC lost 0.8 per cent, UOB slipped 1 per cent, and DBS fell 1.1 per cent. Just three STI counters closed higher on Wednesday, including UOL, which rose 0.2 per cent, and Keppel Corp which climbed 0.6 per cent. Frasers Logistics & Commercial Trust was the top index gainer, rising 0.9 per cent to S$1.15.

US stocks continued a year-opening slump on Wednesday, with all three key indices pulling back amid uncertainty over when the US central bank might start lowering interest rates. The Dow Jones Industrial Average lost 0.8 per cent to 37,430.19, and the broad-based S&P 500 retreated 0.8 percent as well to 4,704.81. The tech-focused Nasdaq Composite Index plunged a further 1.2 per cent to finish the day at 14,592.21 after a 1.6 per cent drop on Tuesday.

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SG

The founder and CEO of NYSE-listed TDCX Inc. Laurent Junique has made a non-binding proposal to take the company private. On Jan 3, TDCX announced that Junique had offered US$6.60 in cash per ordinary share in the Singapore-based company he does not already own, a nearly 37% premium to its closing price of US$4.83 on Jan 2. Junique beneficially owns some 86.1% of the company’s shares and holds approximately 98.4% of the company’s aggregate voting power.

Regional e-commerce company Lazada on Jan 3 laid off an undisclosed number of its Singapore staff. In response to queries, Lazada claims they are making proactive adjustments to transform their workforce, to better position themselves for a more agile, streamlined way of working to meet future business needs.

EnGro Corporation has disposed of its entire 40% equity interest in joint venture (JV) Tangshan Tanglong Materials for RMB40.8 million ($7.6 million). On Jan 3, the company announced that the JV, which had an issued and paid-up share capital of RMB92 million, had been liquidated by way of members’ voluntary liquidation. The book value and net tangible asset value of the JV at the time of its liquidation on Nov 30 was RMB102.0 million, consisting of pure cash, although no valuation was conducted.


US

Disney wins ValueAct, Blackwells backing in boardroom fight with Trian. Activist hedge funds ValueAct Capital and Blackwells Capital moved on Wednesday (Jan 3) to back Walt Disney as it defends itself against a board challenge from a third activist investor, Trian Fund Management. The unusual twist in the battle for Disney’s board underscores the high stakes in the company’s attempted turnaround under CEO Bob Iger. Iger led Disney from 2005 to 2020, and returned to the helm in November 2022 as investors punished the company’s stock for a US$1.5 billion quarterly loss in its streaming division and the underperformance of many of its movie franchises. Disney said on Wednesday it had reached a deal with ValueAct to advise it on strategy and support its director nominees at its annual shareholder meeting.

Gold prices held steady on Wednesday (Jan 3) as investors looked forward to minutes of the last US Federal Reserve policy meeting due later in the day for more clarity on its next moves, while a stronger US dollar kept bullion’s gains in check. The US dollar index hovered near a more than one-week peak hit in the previous session, helped by a jump in Treasury yields.

Ford Motor is increasing the price of some 2024 F-150 Lightning models, while lowering the costs of its most expensive models. The Detroit automaker confirmed Wednesday that new starting prices for the pickup will be adjusted. The price adjustments come as electric vehicle companies attempt to balance slower-than-expected consumer demand with profits. Ford has changed pricing on the Lightning as well as the all-electric Mustang Mach-E several times based on consumer demand and raw material costs.

General Motors’ 2023 U.S. vehicle sales were its best since 2019, prior to the effects of the Covid-19 pandemic and yearslong supply chain problems. The Detroit automaker on Wednesday reported sales of roughly 2.6 million vehicles in 2023, including 625,176 cars and trucks sold during the fourth quarter, roughly flat compared to a year earlier. GM’s sales are in line with expectations for overall industry sales.

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


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