Daily Morning Note – 7 September 2021

Dear valued client,

Asian stocks look set to climb Tuesday, bolstered by a rally in Japan and expectations that central bank support for the reopening from the pandemic will be pared very gradually.

Futures for Japan were up about 1% after the Topix index’s 31-year high. Contracts also rose for Australia and Hong Kong. European shares rallied, helping a gauge of global equities to a fresh all-time high. S&P 500 and Nasdaq 100 futures advanced ahead of a resumption in U.S. markets after a holiday.

Oil extended losses amid Saudi Arabia’s price cut for Asian buyers and demand threats from the outbreak of the delta virus variant. Bitcoin topped $52,000, with El Salvador planning further purchases after buying 200 coins ahead of adopting the cryptocurrency as legal tender on Tuesday.


SG News

Dwaipayan Sadhu, Standard Chartered (StanChart) Singapore’s head of consumer, private and business banking head, has been appointed CEO of StanChart’s digital bank venture with NTUC’s enterprise arm. Mr Sadhu, a StanChart veteran, has more than two decades of industry experience spanning wealth management, payments, deposits, consumer lending, and digital banking. He is currently double-hatting for both roles and will transition to the digital bank CEO later this year, said StanChart. This comes as StanChart announced on Monday that it will be launching a digital-only bank in Singapore with NTUC Enterprise, joining the four other digital banks here that were awarded licences last year.

UOB‘s wholly-owned subsidiaries, UOB China and UOB Indonesia, have secured licences to be appointed cross-currency dealers (ACCDs) for the yuan and rupiah, UOB on Monday said in a statement. With the ACCD licences, UOB China and UOB Indonesia can open offshore accounts in rupiah and yuan, respectively, and offer cross-currency exchange, financing, swaps and forwards in the currency pair to its corporate and institutional clients in the two markets. UOB clients in Indonesia and China will also have direct access to onshore yuan-rupiah foreign exchange (FX) rates and liquidity to hedge their trade transactions and investments, while UOB China can also offer two-way quotes on the yuan against the rupiah in the interbank FX markets. The licences form part of the local currency settlement framework between the People’s Bank of China and Bank Indonesia to facilitate greater bilateral trade and investment flows between the two countries.

Starhill Global Reit‘s manager has priced S$125 million notes with a fixed interest rate of 2.23 per cent per annum due 2028, to be issued under its S$2 billion multi-currency debt issuance programme. The interest for the Series 003 notes will be payable semi-annually in arrear, and have a tenor of seven years. The notes may be redeemed at the option of the issuer in whole or in part on any interest payment date prior to the maturity date on Sept 13, 2028 at the make-whole amount together with interest accrued. CIMB Bank Berhad, Singapore Branch and DBS Bank have been appointed as joint lead managers and bookrunners of the Series 003 Notes and will offer the notes primarily in Singapore.

US News

Goldman Sachs plans to float the assets of its Petershill Partners unit, hoping to cash in on a private equity boom with an IPO valuing the investment vehicle at more than US$5 billion. Petershill, which takes minority stakes in alternative assets managers including private equity, venture capital and hedge funds, will be a standalone company operated by the Goldman Sachs Asset Management team, it said on Monday. The deal will consist of a sale of around US$750 million of new shares as well as existing ones to give Petershill a free float of at least 25 per cent and make it eligible to be included in FTSE indices. Goldman Sachs declined to give an estimated market value for the unit, but a source close to the deal said analysts put it at in excess of US$5 billion. The listing is slated to take place around a month from now, the source said.

The dollar erased all losses sustained after last week’s poor US jobs report and extended gains versus its rivals on Monday as concerns about slowing global growth boosted its safe-haven appeal in a big week for central banks. The dollar index, which measures the currency against six rivals, edged 0.2 per cent higher to 92.31. It had dipped to 91.941 for the first time since Aug 4 on Friday, when a closely watched US labour report showed the world’s largest economy created the fewest jobs in seven months in August. While the weak jobs report doused expectations that the Fed might strike a hawkish note at a meeting later this month, analysts said the data is yet another reminder of global growth losing steam after a bounce earlier this year, a significant headwind for cyclical currencies like the euro and the Aussie.

Oil prices fell on Monday after Saudi Arabia’s sharp cuts to crude contract prices for Asia revived concerns over the demand outlook. Brent crude futures fell 39 cents to settle at US$72.22 a barrel. US West Texas Intermediate crude were last down 40 cents at US$68.89 a barrel. State oil group Saudi Aramco notified customers in a statement on Sunday that it will cut October official selling prices (OSPs) for all crude grades sold to Asia, its biggest buying region, by at least US$1 a barrel. The price cuts were larger than expected, based on a Reuters poll of Asian refiners.

BMW has boosted orders for battery cells to keep pace with accelerating demand for electric cars that made up for more than 11 per cent of deliveries during the half of the year. The German carmaker now has contracts for more than €20 billion (S$31.86 billion) worth of batteries, up from €12 billion previously, chief executive officer Oliver Zipse said in an interview. The cells are destined for i4 sedans, iX sport utility vehicles and other models BMW is producing through 2024. The company plans to start switching to a new generation of batteries the following year.

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

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