Daily Morning Note – 4 May 2021


Asian stocks look set to open modestly higher after a muted session on Wall Street, where technology giants weighed on the market. The dollar dropped with Treasury yields. Futures pointed higher in Australia and Hong Kong. Trading will be limited with Japan and China among markets closed for holidays. Benchmark 10-year Treasury yields dropped back to around 1.6% as Federal Reserve Chair Jerome Powell said the economic recovery remains patchy. Commodities advanced, with silver leading gains in precious metals. Copper and oil climbed more than 1% amid broad rallies in energy and material stocks.


SG News

Singapore’s manufacturers remained optimistic in April, with the latest Purchasing Managers’ Index (PMI) reading on Monday staying in expansionary territory for the 10th straight month. April’s PMI reading rose 0.1 to 50.9, the highest reading since December 2018, on the index compiled by the Singapore Institute of Purchasing and Materials Management (SIPMM). A reading of above 50 indicates expansion, and one below that, contraction.

National carrier Singapore Airlines (SIA) has raised S$2 billion from sale-and-leaseback transactions for 11 aircraft comprising seven Airbus A350-900s and four Boeing 787-10s. Four different parties arranged the transactions, SIA said in a bourse filing on Monday. They are Aergo Capital, Altavair, EastMerchant/Crianza Aviation and Muzinich and Co.

Mainboard-listed Sembcorp Marine (Sembmarine) said on Monday in an interim business update that it expects losses to continue for FY2021. The offshore and marine company continues to face supply chain constraints due to Covid-19, and a shortage of skilled workers as foreign workers who left Singapore over the past year have been unable to return due to ongoing border controls in countries such as India and Bangladesh.

The long-stop dates for a mobile payments joint venture (JV) in Myanmar and the proposed acquisition of controlling interest in of Digital Money Myanmar Limited from Telenor Group have not been extended. The previous date stated was April 30, 2021. Yoma Strategic said that both entities expect to continue seeking regulatory approvals to further the two transactions mentioned.

Mainboard-listed AEM Holdings’ first-quarter earnings plunged year on year, which the group attributed to a high revenue base in a business update on Monday. Net profit fell by 63.1 per cent to S$13.34 million for the three months to March 31, while revenue was down 45.4 per cent to S$80.23 million, with AEM noting that its latest results followed a “record-breaking Q1 2020”.

Private equity firm Novo Tellus’ partial offer to acquire a 51-per-cent stake in IT life-cycle services and data-centre equipment provider Procurri at S$0.365 per share has lapsed.

US News

Estée Lauder Companies shares slid 0.6% in premarket trading Monday, after the cosmetics and beauty company posted stronger-than-expected profit for its fiscal third quarter but sales that missed estimates. The company posted net income of $456 million, or $1.24 a share, in the quarter to March 31, after a loss of $6 million, or 2 cents a share, in the year earlier period.

Avis Budget Group Inc. late Monday reported another quarterly loss and sales that dropped 22%, but the results were better than expected and the stock fell about 1% in the extended session. Avis said it lost $170 million, or $2.43 a share, in the quarter, compared with a loss of $158 million, or $2.16 a share, in the year-ago quarter. Adjusted for one-time items, Avis lost 46 cents a share.

The chief executive of the biggest U.S. chip-maker, Intel Corp, said the company is going to curb its focus on buying back its own stock. A global shortage of semiconductor chips, critical in cars, laptops and other major consumer products, has put a spotlight on Intel, the only major U.S. chip manufacturer.

Bombardier Inc said on Monday it expects business jet revenues to rise by 18% to $1.3 billion in the first quarter, compared with a year earlier. The maker of Global aircraft will report results on Thursday.

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

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