Daily Morning Note – 6 July 2021

PHILLIP SUMMARY

Asian stocks look set for a mixed open Tuesday as traders weigh a jump in crude oil amid an OPEC+ crisis that derailed a deal to boost output. A gauge of the dollar was steady.

Equity futures rose in Japan and Australia but dipped in Hong Kong. U.S. stocks and Treasury markets were closed Monday for the Independence Day holiday, keeping trading subdued. European shares edged higher and U.S contracts fluctuated in early Asian trading.


BREAKING NEWS

SG News

Ascendas India Trust (a-iTrust) is investing 12 billion rupees (S$216.6 million) to develop and operate the first of two buildings planned for its inaugural data centre campus in Navi Mumbai, India. In a press statement on Monday, the trustee-manager said the upcoming data centre will be one of the largest data centre campuses in Airoli. The campus will host customers such as global technology giants, cloud service providers and large domestic enterprise clients, it added.

Vertex Holdings is planning to raise funds for dealmaking by listing a special purpose acquisition company in Singapore, which could be the country’s first such deal, according to people familiar with the matter. The venture capital holdings company owned by Temasek Holdings is working with advisers on the potential SPAC initial public offering, said the people, asking to be named as the process is private. Details of the blank-check company including size and timeline haven’t been finalized, pending listing guidelines by Singapore exchange, the people said.

Following the completion of the acquisition of dissenting shareholders’ stakes by the offeror AEM Singapore on July 5, CEI will be delisted on July 6. Contract manufacturer CEI was acquired by a wholly-owned firm of electronics services provider AEM Holdings at S$1.15 per share, with an option for shareholders to go for all cash or cash with new AEM shares. As the compulsory acquisition of the stakes owned by the minority who did not accept the offer has been completed, CEI in a regulatory filing on Monday to the Singapore Exchange announced its delisting from the mainboard at 9 am on Tuesday.


US News

US tech giants Facebook, Alphabet’s Google and Twitter have privately warned the Hong Kong government that they could stop offering their services in the city if authorities proceed with planned changes to data-protection laws, the Wall Street Journal reported on Monday, citing a letter. The laws could make the tech companies liable for the malicious sharing of individuals’ information online, the newspaper added.

Opec+ abandoned its meeting without a deal, tipping the cartel into crisis and leaving the oil market facing tight supplies and rising prices. Several days of tense talks failed to resolve a bitter dispute between Saudi Arabia and the United Arab Emirates, delegates said, asking not to be named because the information wasn’t public. The group didn’t agree a date for its next meeting, according to a statement from Opec Secretary-General Mohammad Barkindo. The most immediate effect of the breakdown in talks is that Opec+ won’t increase production for August, depriving the global economy of vital extra supplies as demand recovers rapidly from the coronavirus pandemic.

A rebound in global gas demand to 2024 following a record fall last year is poised to knock the world off track for a climate goal of achieving net zero emissions by 2050, the International Energy Agency (IEA) said on Monday. More than 190 countries have signed the Paris agreement designed to limit global warming to 1.5 degrees Celsius, which will require a huge reduction in the use of fossil fuels such as coal and gas.


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

TECHNICAL PULSE

Ascendas REIT

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Ascendas REIT (SGX: A17U) is still on a downtrend. With the descending triangle in action, the threat of breaking below the support zone at $2.83 remains a threat. However, recent technicals indicate that the REIT is likely to break above the upper boundary trendline of the descending triangle.

Buy stop: 3.00 Stop loss: 2.85 Take profit 1: 3.15 Take profit 2: 3.25

Ifast Corp Ltd

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Ifast Corp Ltd (SGX: AIY) strong upside is set to continue after a small correction from 31st May to 28th June 2021 based on the recent technical and price actions.

Buy stop: 8.40 Stop loss: 7.35 Take profit 1: 9.80 Take profit 2: 10.25

Mapletree Logistic Trust

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Mapletree Logistic Trust (SGX: M44U) upside is making a return after recent technical indicate potential further upside.

Buy spot: 2.07 Stop loss: 1.95 Take profit 1: 2.20 Take profit 2: 2.31

>> Read more technical reports

HK Reports – Read up on our Hong Kong reports here

RESEARCH REPORTS

Phillip 3Q21 Singapore Strategy – Vax and Relax

Analyst: Paul Chew

– STI was back to its old penchant. The 1.1% contraction in 2Q21 led to its underperformance against major asset classes.

– We do not expect the hyperinflation of the 1970s as economic conditions are vastly different this time.

– Strategy is to position for an aggressive relaxation of group activities and eventual border re-opening.

>> Read more research reports

Webinar Of The Week

Market Outlook: CapitaLand, Oxley Holdings, SPH, SG REITs Monthly, SG Weekly

Date: 5 July 2021

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Read the research report(s), available through the link(s) above, for complete information including important disclosures Important Information





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