Daily Morning Note – 6 January 2022

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PHILLIP SUMMARY

Stocks in Asia are set to open weaker after a selloff in U.S. technology shares and Treasuries accelerated once Federal Reserve minutes signaled interest-rate hikes may be more aggressive than many had expected. Australian equities slipped at the open, while Japan futures fell. U.S. contracts dropped after the Nasdaq 100 tumbled the most since March as rising Treasury yields added to concerns over growth and profitability. The S&P 500 retreated as traders increased bets U.S. rates will increase at least three times this year. The yield on the U.S. 10-year note climbed to 1.71%, a level not seen since April. Overnight swaps markets moved to price in an 80% chance of a 25 basis-point hike at the Fed’s meeting in March. The dollar was little changed.


BREAKING NEWS

SG

Moody’s Investors Service has placed the Baa1 issuer rating of Mapletree Commercial Trust (MCT) on review for downgrade, ahead of its planned merger with Mapletree North Asia Commercial Trust (MNACT) in a S$4.2 billion deal. Concurrently, Moody’s is reviewing MNACT’s Baa3 rating for an upgrade, the credit rating agency announced on Wednesday (Jan 5) after trading hours.

Cromwell European Real Estate Investment Trust (Cromwell E-Reit) has entered into 3 separate sale and purchase agreements to acquire logistic properties in the UK and the Netherlands, for an aggregate purchase price of 57.8 million euros (S$88.4 million), its manager said on Wednesday (Jan 5).

Sembcorp Energy India, a wholly-owned subsidiary of Sembcorp Industries (Sembcorp), has signed a long-term power purchase agreement (PPA) to supply 625 megawatts of power to power distribution companies in Andhra Pradesh in India. The 12-year agreement is expected to commence in 2023, said mainboard-listed Sembcorp in a bourse filing on Wednesday (Jan 5).

Fintech company ECXX Global, an associate of Hatten Land, has been granted a recognised market operator (RMO) licence by the Monetary Authority of Singapore (MAS). The licence recognises ECXX, which Hatten Land has a 19.3 per cent equity interest in, as a RMO in respect of operating an organised market for securities and collective investment schemes relating solely to capital markets products. This took effect from Jan 1.

Marco Polo Marine announced on Wednesday (Jan 5) that it has been awarded a permit by the Indonesian authorities to conduct ship recycling activities, as its subsidiary ventures into green ship recycling.

Mainboard-listed Grand Venture Technology has acquired a manufacturing facility in Penang for RM13.5 million (S$4.4 million), with the aim of creating an integrated hub in Malaysia.

US

Datadog, Inc., the monitoring and security platform for cloud applications, today announced a global strategic partnership with Amazon Web Services, Inc. (AWS). As part of this collaboration, AWS and Datadog will work together to develop and deliver tighter product alignment in the future.

General Motors launched its all-electric Chevrolet Silverado on Wednesday, formally entering a contest for the lucrative US pickup market against fellow Detroit giant Ford as well as Tesla and other electric vehicle upstarts. Mary Barra, chief executive of the Detroit automaker, unveiled the vehicle in a virtual appearance at the Consumer Electronics Show, giving a wide-ranging keynote speech that also highlighted GM’s autonomous technology.

Federal Reserve officials last month were concerned about the Omicron impact, but believed the US economy had recovered enough from the pandemic downturn that interest rate hikes could come sooner than expected, according to minutes of the December meeting released Wednesday. The Federal Open Market Committee (FOMC) accelerated the withdrawal of the pandemic stimulus measures and released forecasts showing central bankers expect to hike interest rates – their most potent weapon against price increases – as many as three times in 2022.

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

Technical Pulse: Singapore Exchange Ltd

Recommended: Technical BUY; Analyst: Chua Wei Ren

Singapore Exchange Ltd (SGX: S68) The downtrend since August 2021 has come to an end after the consolidative price action, which has broken out of the downtrend line. Technicals further show that SGX is heading for a potential break to the upside

Buy stop: 9.55 Stop loss: 8.75 Take profit 1: 10.40 Take profit 2: 11.20

POEMS Podcast: Let the Money Talk

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Daily Morning Note – December 13, 2021

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