DAILY MORNING NOTE | 6 October 2023

Singapore shares rose on Thursday (Oct 5), reflecting US stock rallies as US Treasury yields fell. It increased 7.71 points or 0.2 per cent to 3,155.1. Across the broader market, gainers outnumbered decliners 333 to 209, as 1.1 billion securities worth S$746.3 million changed hands. Regional indices were largely up. Japan’s Nikkei 225 advanced 1.8 per cent, while the Hang Seng Index was up 0.1 per cent.

US stocks closed slightly lower on Thursday as traders braced for key employment data likely to have a bearing on the future path of interest rates. The Dow Jones Industrial Average finished the day flat at 33,119.57, reversing declines in the middle of the day. The broad-based S&P 500 closed down 0.1 per cent at 4,258.19, as did the tech-rich Nasdaq Composite Index, which fell to 13,219.83.

Top gainers & losers

Factsheets


EVENTS OF THE WEEK

Factsheets


SG

Singapore’s retail sales rose 4 per cent on year in August, climbing from the revised 1.3 per cent growth recorded in July, Department of Statistics (Singstat) data showed on Thursday (Oct 5). The month’s figure, which extended expansion for the seventh straight month, was higher than the median 0.9 per cent rise expected by private-sector economists polled by Bloomberg. On a month-on-month seasonally adjusted basis, retail sales rose 1.7 per cent, extending the revised 0.8 per cent expansion charted in July. August’s estimated total retail sales value was S$4 billion, with online sales accounting for 12.2 per cent. Excluding motor vehicles, retail sales still expanded by 3.7 per cent from the year-earlier period, marking the 18th consecutive month of expansion. It also gained sequentially – up 1.9 per cent on a seasonally-adjusted basis.

OKP Holdings has won a contract worth $11.7 million from PUB for drainage improvement works at several locations islandwide. Works related to the contract will be done by Sept 2026. “We are encouraged by the trust and confidence shown in our drainage/sewage specialisation and expertise and will focus on the smooth delivery,” says Or Toh Wat, the company’s group managing director. With this contract win, OKP now has a total orderbook of $583.7 million. OKP shares last changed hands at 21 cents, up 31.25% year to date.

ESR-Logos Real Estate Investment Trust’s (Reit) high-specifications industrial building at 7002 Ang Mo Kio Avenue 5 has secured an occupancy of about 50 per cent, upon achieving its temporary occupation permit. This follows the completion of the property’s asset-enhancement initiative, which involved its development into a multi-tenanted high-specifications building with a gross floor area of 25,000 square metres. The space is suitable for advanced manufacturing, info communications and data centre tenants, said the Reit manager on Thursday (Oct 5). Units of ESR-Logos Reit ended Thursday 3.8 per cent or S$0.01 higher, at S$0.275.

US

Oil prices fell about 2 per cent on Thursday, extending the previous session’s losses of nearly 6 per cent, as worries about fuel demand outweighed an Opec+ decision to maintain oil output cuts, keeping supply tight. Global benchmark Brent crude futures and US West Texas Intermediate ( WTI) crude futures have declined about US$10 a barrel in less than 10 days after edging close to US$100 in late September. The combined percentage drop over the last two days was the steepest since May for both crude benchmarks. Brent futures settled US$1.74, or 2.03 per cent, lower at US$84.07, while US West Texas Intermediate crude futures were US$1.91, or 2.3 per cent, lower at US$82.31.

Shares of Rivian Automotive fell sharply on Thursday, after the company surprised investors with a plan to offer $1.5 billion in convertible notes. It also provided a preliminary estimate of its third-quarter revenue that was in line with Wall Street estimates. Rivian said it expects its third-quarter revenue to come in between $1.29 billion and $1.33 billion, roughly in line with Wall Street estimates of $1.3 billion. Rivian also estimated that it had cash and equivalents of $9.1 billion as of Sep. 30, down from $10.2 billion at the end of the second quarter. Rivian plans to offer $1.5 billion worth of senior, unsecured “green” convertible notes due in 2030. Buyers will have the option to purchase up to an additional $225 million worth of notes, the company said. Shares closed down over 22% on Thursday.

The U.S. labor market held strong as September came to a close, with weekly jobless claims holding around recent lows, the Labor Department reported Thursday. Initial filings for unemployment benefits totaled a seasonally adjusted 207,000 for the week ended Sept. 30, up just 2,000 from the previous period and below the Dow Jones consensus estimate for 210,000. Continuing claims, which run a week behind, were little changed at 1.664 million, below the 1.68 million estimate from FactSet. The four-week moving average of claims, which irons out volatility, fell to 208,750, a decline of 2,500.

Dell Technologies on Thursday (Oct 5) reiterated that it expects revenue to grow at a compounded annual rate of 3 per cent to 4 per cent over the long term, disappointing some investors who expected AI to drive a bigger sales jump and sending its shares down 4 per cent. The company, which makes PCs and servers that are used to support technology like ChatGPT, also forecast long-term adjusted earnings per share growth of 8 per cent or more and said it would buy back another US$5 billion in stock on top of a similarly sized repurchase plan launched in 2021. The revenue outlook suggests that the boost from generative AI could take longer to materialise for the company whose shares have rallied nearly 20 per cent since a strong earnings report in August on optimism about its role in enabling the new technology.

Levi Strauss on Thursday cut its full-year sales forecast, as it missed Wall Street’s quarterly revenue expectations and was dragged down by weaker shopping trends at department stores and big-box retailers across the U.S. The company’s more cautious outlook comes just three months after it already slashed its full-year profit outlook. It said it now expects net revenues to be flat to up 1% year-over-year compared with a prior range of between 1.5% to 2.5% growth. It said it anticipates adjusted earnings per share to be on the low-end of the previously shared range of $1.10 to $1.20. Net income for the three-month period that ended Aug. 27 was $10 million, or 2 cents per share, compared with $173 million, or 43 cents per share a year earlier. On an adjusted basis, earnings per share were 28 cents. Sales were roughly in line from the $1.52 billion in revenue that the company reported in the year-ago period.

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


RESEARCH REPORTS

PSR Stocks Coverage

Factsheets

Factsheets


For more information, please visit:

https://www.stocksbnb.com/singapore-stocks-coverage/


Upcoming Webinars

Strategy & Stock Picks (SG Market)

Date & Time: 7 Oct 2023 | 10am – 12pm

Register: https://tinyurl.com/ycy2ezwu


Guest Presentation by Oceanus Group Limited

Date & Time: 10 Oct 2023 | 12pm – 1pm

Register: https://tinyurl.com/hbu9kpwu


Strategy & Stock Picks (US Market)

Date & Time: 12 Oct 2023 | 7.30pm – 9pm

Register: https://tinyurl.com/ycy2ezwu


Guest Presentation by Keppel Pacific Oak US REIT (KORE)

Date & Time: 19 Oct 2023 | 12pm – 1pm

Register: http://tinyurl.com/5n8kh8ta


POEMS Podcast:

Research Videos

Weekly Market Outlook: Sasseur REIT, ST Engineering, Technical Analysis, SG Weekly & More!
Date: 2 October 2023
Click here for more on Market Outlook.
Sign up for our webinars here, and be among the first to receive economy and market updates.

PHILLIP RESEARCH IN 3 MINS

Phillip Research in 3 minutes: #29 Keppel Corporation; Initiation
Click here for more on Phillip in 3 mins.

Follow our Socials

Facebook Social Icon Instagram Icon Twitter Social Icon Youtube Social Icon Linkedin Social Icon TikTok Social Icon Spotify Social Icon

Join our Singapore Equity Research Community on POEMS Mobile 3 App for the latest research reports, market updates, insights and more

Click to join!

Disclaimer

The information contained in this email and/or its attachment(s) is provided to you for information only and is not intended to or nor will it create/induce the creation of any binding legal relations. The information or opinions provided in this email do not constitute an investment advice, an offer or solicitation to subscribe for, purchase or sell the e investment product(s) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of this information. Investments are subject to investment risks including possible loss of the principal amount invested. The value of the product and the income from them may fall as well as rise. You may wish to seek advice from an independent financial adviser before making a commitment to purchase or investing in the investment product(s) mentioned herein. In the event that you choose not to do so, you should consider whether the investment product(s) mentioned herein is suitable for you. PhillipCapital and any of its members will not, in any event, be liable to you for any direct/indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials attached to this email. The information and/or materials provided 揳s is?without warranty of any kind, either express or implied. In particular, no warranty regarding accuracy or fitness for a purpose is given in connection with such information and materials.

Confidentiality Note

This e-mail and its attachment(s) may contain privileged or confidential information, which is intended only for the use of the recipient(s) named above. If you have received this message in error, please notify the sender immediately and delete all copies of it. If you are not the intended recipient, you must not read, use, copy, store, disseminate and/or disclose to any person this email and any of its attachment(s). PhillipCapital and its members will not accept legal responsibility for the contents of this message. Thank you for your cooperation.

Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you

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