Daily Morning Note – 9 July 2021
Asian shares look poised to follow U.S. equities lower Friday, with the rally in Treasuries gaining pace on growing anxiety that the spread of Covid-19 variants could hamper the global economic recovery
Futures fell in Japan and Australia but edged up in Hong Kong, where a key gauge of Chinese stocks is near a bear market. U.S. contracts dipped after the S&P 500 and Nasdaq 100 retreated from records. Economically-sensitive sectors like industrials and materials led Wall Street lower
Axington Inc has inked a non-binding memorandum of understanding to acquire a 60 per cent stake in a Hong Kong Web technology company that is expected to result in a reverse takeover of the Catalist-listed cash company. In its regulatory statement to the Singapore Exchange on Thursday, Axington announced that the understanding inked on July 8 would form the broad basis of the definitive agreements to be entered into within a month with Delta Investment Holding Group for the proposed acquisition of the stake in Veivo Web Technology for S$405 million
National grid operator SP Group (SP) has started its trial of vehicle-to-grid (V2G) technology and has raised its investment in a V2G technology firm as Singapore progresses towards wider adoption of electric vehicles (EVs). The company aims to test the viability of tapping the energy stored in EVs in the trial to enhance the reliability of the grid, which will need to support more than 600,000 vehicles when Singapore phases out internal combustion engine vehicles by 2040, said SP in its media statement on Thursday
Singapore’s total shophouse transaction value hit S$836.1 million in H1 2021, up 29.9 per cent from H2 2020, backed by the pick-up in activity from Q4 2020. This total was made up of the first and second quarter’s transaction values of S$365.4 million and S$470.7 million respectively. In terms of volume, the half-year saw 118 sales, up from the 90 in H2 2020. While freehold shophouses still accounted for the bulk of transactions – 78.8 per cent – leasehold sales volume more than doubled from the previous half-year to 25 units
The number of Americans filing new claims for unemployment benefits rose slightly last week but continuing claims dropped, another indication that the labour market recovery from the Covid-19 pandemic continues to be choppy. Businesses have reopened at a rapid clip, boosted by a rollback in restrictions now that more than 155 million Americans have been fully vaccinated against the coronavirus. Still, the job market rebound has been anything but steady despite recent employment gains. Initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 373,000 for the week ended July 3, the Labor Department said on Thursday. Economists polled by Reuters had forecast 350,000 applications for the latest week
Oil prices fell more than US$1 a barrel on Wednesday in another seesaw trading session, as investors feared what this week’s collapse in Opec+ talks meant for worldwide production. Crude markets have been volatile over the last two days following the breakdown of discussions between major oil producers Saudi Arabia and United Arab Emirates (UAE). Brent crude settled at US$73.43 a barrel, falling US$1.10 or 1.5 per cent. US West Texas Intermediate settled at US$72.20 a barrel, shedding US$1.17 or 1.6 per cent. Both benchmarks rallied more than US$1 a barrel earlier in the session, similar to Tuesday’s action
Tesla debuted a significantly cheaper version of its locally built Model Y sports utility vehicle in China as deliveries for June slipped amid concern a string of negative publicity may have soured consumer sentiment toward the electric-carmaking pioneer. Wholesale shipments of China-made Teslas decreased 0.9 per cent last month to 33,155 from 33,463 in May, data from China’s Passenger Car Association showed Thursday. May’s figure was a surge of almost 30 per cent from April. The wholesale figures may not necessarily reflect the level of retail demand Tesla fields directly versus via traditional dealerships
Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, CNBC, PSR
Singapore Banking Monthly – All eyes on dividend cap review
Recommendation: Overweight (Maintained)
Analyst: Terence Chua
– Singapore loans were up 0.2% YoY in May. Business loans contracted for ninth straight month by 0.5% YoY. Consumer loans were up for tenth straight month, by 0.3% YoY, aided by housing.
– MAS is assessing whether to extend current dividend restrictions on banks. We continue to see the potential for a removal of the dividend cap.
– Maintain OVERWEIGHT. Loans remain on path of recovery on stable interest rates. Catalysts to come from a relaxation of dividend caps on banks. We believe MAS could ease the dividend cap as Singapore banks have kept sufficient capital buffers. We prefer DBS (DBS SP, ACCUMULATE, TP: S$31.40) for sector exposure on account of its wealth-management and investment banking franchises.
HK Reports – Read up on our Hong Kong reports here
Webinar Of The Week
Market Outlook: CapitaLand, Oxley Holdings, SPH, SG REITs Monthly, SG Weekly
Date: 5 July 2021
Updates summarised in 3 minutes
|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.|
|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.|