DAILY MORNING NOTE | 8 September 2023

STOCKS in the Singapore market closed on a surprisingly positive note despite widespread losses in key markets in the region on Thursday (Sep 7). Singapore stock advanced 0.1 per cent or 3.71 points to 3,226.59. Diversified conglomerate Jardine Matheson was among the top gainers of the day. The counter closed up 0.4 per cent or US$0.21 at US$47.92.

WALL Street stocks finished mostly lower on Thursday on worries about higher interest rate policy as Apple shares tumbled again on worries over China. The Dow Jones Industrial Average finished up 0.2 per cent at 34,500.73. The broad-based S&P 500 declined 0.3 per cent to 4,451.14, while the tech-rich Nasdaq Composite Index dropped 0.9 per cent to 13,748.83.

SG

FoodPanda on Thursday (Sep 7) inked a partnership with DFI Retail Group – which runs the Cold Storage, CS Fresh and Giant supermarkets – to provide grocery delivery services in Singapore, promising delivery times of under an hour and no price mark-up.

Singapore’s investment firm Temasek led a US$140 million funding round in India’s Ola Electric at a valuation of US$5.4 billion, two sources with the direct knowledge said, the latest funding for the e-scooter maker before its initial public offering.The investment round has been closed and Ola will be receiving the funds within a week’s time, though there will be another round of fund raising before it files papers for an up to US$1 billion IPO planned for late 2023, said the first source.

The anti-malware security feature on the OCBC Digital app has prevented scammers from making away with more than S$2 million since its launch on Aug 5. OCBC said in a press release on Thursday (Sep 7) that within a month, more than 30 customers reported malware in sideloaded apps – apps from sources outside official app stores – that compromised their Android mobile phones.

Yongnam Engineering & Construction, a wholly-owned unit of steel fabricator Yongnam Holdings, has received a letter of demand from the attorney of Malayan Banking Berhad. The letter of demand is for a total of RM15.9 million (S$4.6 million) in relation to outstanding payments due under three loan facilities. In a filing to the Singapore bourse on Thursday (Sep 7), suspended stock Yongnam’s judicial managers said the letter of demand was dated Aug 24, and was received by the company’s unit on Sep 5.

US

Founders behind defunct self-driving startup backed by Ford and Volkswagen launched a new autonomous trucking firm, Stack AV, on Thursday (Sep 7) with investment from Japan’s SoftBank Group. SoftBank declined to disclose its investment, but a Bloomberg News report said it will provide more than US$1 billion, citing an economic development official in Pittsburgh where the startup will be based.

Ford Motor said on Thursday (Sep 7) it raised the pay of 8,000 US hourly workers represented by the United Auto Workers (UAW) union just a week before its union contract expires. The raises, negotiated in the 2019 contract with the UAW, lift the pay of the workers by US$4.33 an hour, or US$9,000 a year, the automaker said in a statement. The move accelerates how quickly the workers reach the top pay rate of about US$32 an hour, reducing the time from eight years to as fast as four years, Ford said.

Google is facing a new lawsuit in Britain, which accuses the US tech giant of stifling competition in the search -engine market and causing prices to rise across the UK economy, a statement said on Thursday (Sep 7). The claim, filed with the UK Competition Appeal Tribunal, is seeking around £7 billion (S$11.9 billion) in damages on behalf of effectively every consumer in the country.

Apple shares tumbled on Thursday (Sep 7), on track to wipe out US$212 billion of market value in just two days, as China plans to expand a ban on the use of iPhones to government-backed agencies and state companies. Shares of the Cupertino, California-based company fell as much as 5.1 per cent, bringing its two-day slump to 7.1 per cent. Apple is the biggest component in major US equity indexes, adding to a broader selloff sparked in part by a litany of woes in China.

Philips said on Thursday (Sep 7) it has reached a settlement to resolve one category of legal claims against it following a major recall of the Dutch medical equipment maker’s sleep apnea and respiratory devices.The company said it has struck a deal to settle US class action “economic loss” claims. Philips will make an initial payment of US$479 million to a fund to cover payments claimants covered by the settlement, which will vary depending on the type of device they had.

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

RESEARCH REPORTS

Singapore Banking Monthly – Rates stable and CASA stable

Recommendation: Overweight (Maintained)

Analyst: Glenn Thum

– August’s 3M-SORA was up 1bps MoM to 3.69% and 3M-HIBOR was down 12bps MoM to 4.98%.
– Singapore domestic loans dipped 6.15% YoY in July, below our estimates. The loan decline has slightly increased from the previous month. The CASA balance was flat at 18.9% (Jun23: 18.9%).
– Maintain OVERWEIGHT. We remain positive on banks. Bank dividend yields are attractive at 5.7% with upside surprise in dividends due to excess capital ratios and push towards higher ROEs. SGX is another major beneficiary of higher interest rates (SGX SP, BUY, TP S$11.71).

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