Daily Morning Note – 6 June 2019

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YOUR PHILLIP SUMMARY

Asian equity futures may open mixed, with Nikkei futures slightly up, while the Hang Seng may open down. U.S. stocks climbed on optimism Mexican tariffswill be avoided.

Treasuries rose as a weak private-jobs report bolstered bets the Fed will ease, outweighing solid service-industries figures. The spread between 2- and 10-year yields reached the widest since November.

The dollar rose against all G-10 currencies except the kiwi. Oil entered a bear market after U.S. supplies jumped the most in almost 30 years.


TECHNICAL PULSE

United Overseas Bank Ltd

Current Sentiment: Technical Buy



RESEARCH REPORT

Singapore Banking Monthly – Slow but sustainable growth

Recommendation: Overweight (Maintained), Analyst: Tin Min Ying

– Singapore loan growth slowed further to 1.4% YoY. Consumer loans contracted for the first time in decades, hammered by persistent weakness in housing loans.

– Domestic deposits rose 7.1% YoY, held up by fixed deposit growth of 21.6% YoY, the fastest in almost twelve years. CASA deposits continues to contract at -1.1% YoY.

– 3-month SIBOR and SOR rose 6.2bps and 8.0bps to 2.007% and 2.052% respectively.

– Maintain the Singapore Banking Sector at Overweight. While the trade war affects investor sentiments in the near term, we believe the banks’ fundamentals remain intact to withstand risks and deliver growth on a sustained basis.


BREAKING NEWS

The European Central Bank will try to give an ailing euro zone economy a boost on Thursday and may even set the stage for more action later this year as an escalating global trade war saps growth and unravels the benefits of years of ECB stimulus.

Oil prices fell on Wednesday, with West Texas Intermediate crude futures (WTI) dropping to its lowest since January after US crude inventories unexpectedly surged, adding to concerns about slowing global growth.

Asian markets rose on Wednesday, tracking rallies on Wall Street after the US Federal Reserve chief indicated greater openness to lowering interest rates and acknowledged the impact of trade tensions on growth.

Wall Street stocks rose for a second straight session on Wednesday, with solid data on the US services sector offsetting a weak private sector hiring report.

Tokyo stocks opened higher on Wednesday extending rallies on Wall Street, as the US Federal Reserve chief signalled a greater openness to cutting interest rates.

CHALLENGER Technologies said on Tuesday night that the Singapore Exchange has no objection to its delisting, subject to compliance with listing rules.

SIX more mainboard-listed companies have announced their addition to the Singapore Exchange’s watch-list with effect from June 6, due to not meeting minimum trading price (MTP) requirements.

European stock markets crept higher on Wednesday as defensive shares gained ground, but rising tensions between Italy and the European Commission over the country’s debt dampened sentiment.

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





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IMPORTANT INFORMATION

This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <www.phillipfunds.com> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  

 

Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066 www.phillipfunds.com