Daily Morning Note – 9 March 2022

Welcome to our Daily Morning Note from our Research team!


President Joe Biden said the U.S. will ban imports of Russian fossil fuels including oil, a major escalation of global efforts to hobble Russia’s economy in retaliation for its attack on Ukraine. The U.S. move will be matched in part by the U.K., which announced a ban on Russian oil imports, though it will continue to allow natural gas and coal from the country. “The U.S. is targeting the main artery of Russia’s economy,” Biden said Tuesday in Washington. “We will not be part of subsidizing Putin’s war.” The escalation in sanctions comes as the United Nations reported that close to 500 civilians have been confirmed killed by Russian attacks across Ukraine, including dozens of children, though it added the actual number is likely much higher.

US stocks lost more ground on Tuesday after President Joe Biden imposed a ban on imports of Russian petroleum, and more major firms announced they were shutting operations in Russia. Britain also announced it was phasing out energy purchases from Russia after the invasion of Ukraine, while oil giants Shell and BP, both based in Britain, said they would stop buying Russian oil and natural gas immediately. The latest steps sent oil prices up another 4.6 per cent, with Brent futures rising to US$128.77 a barrel. The broad-based S&P 500 dropped 0.7 per cent to end at 4,170.7, while the tech-rich Nasdaq Composite lost 0.3 per cent to 12,795.55.

Top gainers & losers




Latest GLS tenders see firm land prices, keener interest from developers. The latest Government Land Sales (GLS) tenders for 2 99-year leasehold housing sites have drawn keen interest, reflecting developers’ hunger for land in the suburbs following strong sales last year. It also reflects their confidence that the segment will continue to post healthy demand from first-time homebuyers and HDB upgraders. The top bid for an executive condo (EC) housing site in Bukit Batok West Avenue 8 was S$661.67 per square foot per plot ratio (psf ppr), setting a new record price for EC development land.

Singapore new home sales sink 27% in February. NEW home sales sank in February in the absence of major new launches. Chinese New Year festivities and the declining inventory of unsold new homes also dampened sales during the month, analysts said. “Some developers were holding back their new project launches until the current wave of Omicron Covid-19 infections has subsided,” said Nicholas Mak, head of research and consultancy at ERA Singapore. PropNex Realty head of research and content Wong Siew Ying added that as at the end of Q4 2021, the unsold inventory in the rest of central region (RCR) and outside of central region (OCR) were both at record lows of 4,306 and 3,972 units respectively. Based on caveats lodged, developers sold 490 new private homes last month, a 27.2 per cent drop from January’s 673 units.

Proxy advisers give cautious nod for ARA Logos Logistics Trust (ALog Trust) unitholders to accept merger offer. Proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis have recommended that unitholders of ALog Trust vote in favour of the merger with ESR-Reit, based on the revised terms of the offer. Both ISS and Glass Lewis had in January recommended that unitholders vote against the merger on grounds that the process had been “questionable” and that the offer price was unfair to ALog Trust unitholders.

Malaysia’s Top Glove has postponed its plan to raise US$347 million via a Hong Kong listing as Russia’s invasion of Ukraine weighs on investor sentiment and heightens markets volatility, according to a person with direct knowledge of the matter. The company, which benefited from demand for disposable gloves during the Covid-19 pandemic, has a primary listing in Kuala Lumpur and a secondary listing in Singapore, and had planned the Hong Kong listing to broaden its investor base. The source could not be named as the information has not yet been made public. The rubber glove producer had initially aimed to raise US$1 billion in the Hong Kong listing, which would have been a dual primary, but has scaled down the size of the deal over the past year. Top Glove received shareholder approval in December to issue up to 793.5 million new shares which at the current price of RM1.83 would have raised about US$347 million.

S$63 million to enhance Green Mark Incentive Scheme for Existing Buildings. The Green Mark Incentive Scheme for Existing Buildings will be enhanced to the tune of S$63 million, although applicants will now need to meet higher standards to qualify, Minister for National Development Desmond Lee said at his ministry’s Committee of Supply Debate on Tuesday (Mar 8). The grants under the scheme help building owners undertake retrofits, and achieve higher standards of energy efficiency and sustainability, said Lee. These include changes such as upgrading the cooling system, installing solar panels, or redesigning spaces for natural ventilation. Under the enhanced scheme, the minimum qualifying standard will be raised to Green Mark Platinum, from the previous Green Mark Gold. For example, a project that achieves Zero Energy certification can receive up to S$1.2 million under the enhanced scheme.


US trade deficit hits new record in January as exports fall. A jump in oil and auto imports in January combined with a sharp drop in exports caused the US trade gap to widen again in January, according to official data released Tuesday. The trade deficit in the world’s largest economy increased by 9.4 per cent compared with December to a record US$89.7 billion, the Commerce Department reported. Exports fell 1.7 per cent to US$224.4 billion while imports rose to US$314.1 billion, the report said. US firms have been trying to replenish depleted inventories and bring in parts and materials that have proved hard to find due to the pandemic disruptions that have snarled global supply chains.

A bipartisan group of more than 140 U.S. lawmakers on Tuesday urged leaders in Congress to approve $52 billion in government subsidies for semiconductor chips production and research. The U.S. House of Representatives on Feb. 4 narrowly passed a bill aimed at increasing American competitiveness with China in part by allocating $52 billion to boost U.S. semiconductor manufacturing. The funding will “help prevent future shortages that cause GDP drag, job losses, more expensive consumer goods, and national security vulnerabilities,” said a letter signed by lawmakers, including Representative Doris Matsui and Senator Mark Warner, both Democrats, and Republican Representative Michael McCaul and Senator John Cornyn.

Google on Tuesday announced it has agreed to buy cybersecurity firm Mandiant for around $5.4 billion, one of the largest acquisitions in the tech giant’s history and a big bet that helping companies better address cyber threats can bolster its cloud computing business. “The acquisition of Mandiant will complement Google Cloud’s existing strengths in security,” Google and Mandiant said in a joint statement Tuesday. “Combined with Google Cloud’s cloud-native security offerings, the acquisition will help enterprises globally stay protected at every stage of the security lifecycle.” Microsoft was also rumored to be looking to acquire Mandiant, a firm that focuses on threat intelligence, incident response and cybersecurity testing. Mandiant has been credited with uncovering the Solar Winds hack, a devastating breach that impacted a number of federal agencies and private businesses.

Uber drivers are protesting on social media over record U.S. gasoline prices eating into their earnings just as the ride-hailing firm raised its profitability outlook, with some asking whether it was still worth getting behind the wheel. U.S. retail gasoline prices hit an all-time of $4.173 on Tuesday after Russia’s invasion of Ukraine sent the price of crude oil rocketing. The price per gallon is now around 60% higher than it was two years ago before the COVID-19 crisis. For Uber (UBER.N) and Lyft (LYFT.O), driver discontent comes as the ride-hailing pioneers seek to turn the page on the coronavirus pandemic as customers return to in greater numbers. “Our platform only works if it works for drivers, so we’ll continue to monitor gas prices and listen to drivers over the coming weeks,” Uber said in a statement.

McDonald’s and Starbucks are shutting their restaurants and cafes in Russia, and Coca-Cola is suspending its operations there in response to Russia’s invasion of Ukraine. There were 847 locations of McDonald’s in Russia at the close of last year, according to an investor document. Globally, most McDonald’s (MCD) locations are operated by franchise operators. But that’s not the case in Russia, where 84% of locations are operated by the company, according to the document. Russia’s restaurants, along with another 108 in Ukraine, all operated by McDonald’s, accounted for 9% of the company’s revenue in 2021, according to the document.

Better.com, the embattled online mortgage company, announced Tuesday that it’s taking the “difficult step of streamlining” its operations and laying off about one-third of its workforce, amounting to roughly 3,000 jobs. The company, which gained notoriety last year after its CEO fired 900 employees over Zoom just before Christmas, expanded rapidly during the pandemic when interest rates were low. However, in a letter posted on Better’s website, the company said Tuesday’s layoffs were prompted by a “dramatic drop in origination volume due to rising interest rates,” said Interim President Kevin Ryan. Unfortunately, that means we must take the difficult step of streamlining our operations further and reducing our workforce in both the US and India in a substantial way,” Ryan wrote. “This decision is driven heavily by the headwinds affecting the residential real estate market,” he added. Mortgage rates recently jumped again, rising to a level not seen since the summer of 2019. The 30-year fixed-rate mortgage averaged 3.92% in the week ending February 17, up from 3.69% the prior week, according to Freddie Mac. Rates are increasing because of high inflation and stronger than expected consumer spending.

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

POEMS Podcast: Let the Money Talk

Recent Podcasts:

Money Never Sleeps Ep 04

Ascott Residence Trust – SGX Company Insights Ep 42

Ascendas REIT – SGX Company Insights Ep 41

Visit www.stocksbnb.com to learn more!


Join our Phillip Securities Research Telegram channel for the latest update on our stock coverage!

Click the link to join: https://t.me/stocksbnb


Weekly Market Outlook: Sembcorp Industries, Comfort DelGro, HRnetGroup, SPH, Japfa Ltd, SG Weekly

Date: 7 March 2022

Click here for more on Market Outlook

Sign up for our webinars here, and be among the first to receive economy and market updates.

HK Reports – Read up on our Hong Kong reports here

Updates summarised in 3 minutes

Phillip Research in 3 minutes: #29

Keppel Corporation; Initiation

Click here for more videos on Phillip in 3 Mins

For any research-related matters, email: research@phillip.com.sg

For general enquiries, email: talktophillip@phillip.com.sg
or call 6531 1555.

Read the research report(s), available through the link(s) above, for complete information including important disclosures Important Information


The information contained in this email is provided to you for general information only and is not intended to create any binding legal relation. The information or opinions provided in this email do not constitute investment advice, a recommendation, an offer or solicitation to subscribe for, purchase or sell any investment product. 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 should obtain advice from a financial adviser before making a commitment to invest in any investment product or service. In the event that you choose not to obtain advice from a financial adviser, you should assess and consider whether the investment product or service is suitable for you before proceeding to invest.

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


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