Daily Morning Note – 7 May 2021
PHILLIP SUMMARY
Asian stocks looked set for a muted start amid a warning from the Federal Reserve on stretched valuations and gains in U.S. shares on positive economic data. The dollar retreated. Futures pointed to modest gains in Japan and Australia, though Hong Kong contracts slipped. S&P 500 futures were little changed after rallies in U.S. benchmarks overnight, which included a fresh record for the Dow Jones Industrial Average. China’s shares traded in New York briefly extended losses after Bloomberg News reported the Biden administration is likely to preserve limits on U.S. investments in certain companies from the Asian nation. Treasuries held steady, with the 10-year yield hovering well below recent highs at 1.57%.
BREAKING NEWS
SG News
Catalist-listed protective gear maker Medtecs International Corp more than tripled its first-quarter earnings year on year, as demand for its output “remains elevated”. Net profit rose to US$13.2 million for the three months to March 31, up from US$3.67 million in the year-ago period, according to unaudited results out on Thursday. Revenue rose 5.9 per cent on year, to US$42.2 million, amid the raging Covid-19 pandemic.
Mainboard-listed property player Far East Orchard sank into the red in the first quarter, as the Covid-19 pandemic battered its hospitality business. Net losses came to S$700,000 for the three months to March 31, reversing earnings of S$900,000 in the year-ago period, the group said in a business update on Thursday. Its revenue sank by 29 per cent year on year, to S$27.6 million, which Far East Orchard blamed in part on lockdowns in Australia and low tourist arrivals in Singapore.
Singapore Press Holdings (SPH) said on Thursday that it intends to transfer its media business to a not-for-profit entity, which will be a newly formed public company limited by guarantee. SPH, which publishes The Business Times, said such a not-for-profit model may be unfamiliar in Singapore, but noted that many news organisations overseas are operating under such funding structures.
Mainboard-listed postal service provider Singapore Post (SingPost) reported an e-commerce-dominated top line, with 65 per cent derived from the business. The increase in e-commerce revenue has outstripped the decline in contribution from letters and printed papers, it said, adding that e-commerce accounted for 34 per cent of its domestic post and parcel revenue for the financial year to March, up from 21 per cent in the previous year.
US News
Peloton said Thursday its fiscal third-quarter sales grew 141%, as recent investments in its supply chain allowed it to improve the pace of deliveries. However, even as the company made progress in easing delivery bottlenecks — brought on by its popularity as a way to exercise at home during the coronavirus pandemic — it faced another challenge: The need to recall all of its treadmills after one child died and dozens were injured in accidents involving the Tread+ machine.
Papa John’s first-quarter earnings topped expectations as the pizza chain held on to the momentum it saw during the coronavirus pandemic, even as the country reopens for business. The stock was down 2.7% in Thursday’s premarket after the earnings announcement.
Coach owner Tapestry said Thursday that its fiscal third-quarter sales in North America returned to pre-pandemic levels, as demand for luxury goods rebounds from 2020 lows. Chief Executive Joanne Crevoiserat said the latest results “significantly outpaced expectations,” boosted by Tapestry’s online business and heightened demand for its purses, shoes and other accessories in Asia.
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, PSR
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