Archive for November, 2015

Straits Times Index (STI) dropped 25.57 points to 2,859.12 on Friday, bringing its loss for the week to 58 points or 2 per cent and for the year to 15 per cent. Turnover throughout the five days was low and focused mainly in blue chips and penny stocks. Market consolidated within the range of 2880-2940 from quit a few time but felled after braking its support of 2880 and ended at 2859.18 this week. The Market opened Gap down due to the fall in China’s Market by around 4.5% down after Chinas Industrial data fell by 4.6%. The government’s growth forecast for the full year, however, has been trimmed to “close to 2%”, compared with its earlier projection of 2-2.5%. On a seasonally adjusted, annualised basis, the economy grew 1.9% q-o-q, reversing from 2Q’s 2.6% contraction, as per the Ministry of Trade and Industry. This compares an earlier flash estimate of a 0.1% expansion. Singapore’s private residential property prices have slid 8.2% from its peak in September 2013.The decline largely stems from property cooling measures.
MARKET FORECAST FOR WEEK AHEAD
STI is expected to be bearish as it has broken its support level at 2879.The Fed meeting next month and China’s falling industrial output will lead towards a downtrend. If STI breaks its support level of 2842 it will go further down.
STI COUNTER SPECIFIC NEWS

  • QT Vascular received a stay of enforcement regarding a legal matter in the US.The firm had been ordered to pay damages of US$20.034 million ($28.2 million) in a legal case that has already been through a trial court, but has been granted a stay of enforcement during the appeals process.
  • CHINA Everbright won a deal with the People’s Government of Daxing District, Beijing, to upgrade and expand the Beijing Daxing Tiantanghe Waste Water Treatment Project.
  • China Fishery Group Ltd. failed to repay a US$31 million installment due earlier this month on a US$650 million loan.As a result, one of the lenders successfully applied for provisional liquidators, indicating that the lender is unwilling to negotiate for further extensions or waivers.
  • Developer Bonvests Holdings has agreed to acquire the property known as Lot 66 and 482-484 Murray Street, Perth, Australia from with Murray Street Pty Ltd and the property known as 486-488 Murray Street from Kingsgold Pty Ltd.The total consideration for the acquisitions is A$14.78 million ($15 million).
  • Avic International Maritime Holdings said its subsidiary Deltamarin has clinched a €2 million ($3 million) contract from Qingshan Shipyard of Sinotrans in China to design the world’s first LNG handysize bulk carriers.
  • Chinese shares plunged more than six percent Friday, after inquiries were announced into several major brokerage firms.The benchmark Shanghai Composite Index slumped 6.11 per cent, or 222.18 points, to 3,413.37. The Shenzhen Composite Index, which tracks stocks on China’s second exchange, tumbled 6.66 per cent, or 154.96 points, to 2,170.73.

GLOBAL FACTORS AND WORLD INDICES

  • Asia risks rise as Fed liftoff tests stability.A faster than expected withdrawal of monetary-policy accommodation in major advanced economies could trigger a reversal of global term premia.
  • Profits earned by Chinese industrial companies fell 4.6 per cent in October from a year earlier,declining for the fifth consecutive month. Industrial profits – which cover large enterprises with annual revenue of more than 20 million yuan (S$4.41 million) from their main operations – fell 2.0 per cent.
  • A plunge in Chinese stocks dragged Asian markets down on Friday after authorities launched a probe into several brokerages and profits at the country’s industrial giants sank far more than expected.
  • European share index fell from a three-month high, hit by a drop in the mining sector after a slump in Chinese equities which was triggered by weak data and a regulatory crackdown.
  • Hong Kong stocks slid on Friday, with the headline Hang Seng index posting its worst weekly performance in two months as a tumble in mainland stocks triggered anxiety across the region.The Hang Seng index fell 1.9 percent, to 22,068.32.
  • Chinese shares plunged more than six percent Friday, after inquiries were announced into several major brokerage firms.The benchmark Shanghai Composite Index slumped 6.11 per cent, or 222.18 points, to 3,413.37. The Shenzhen Composite Index, which tracks stocks on China’s second exchange, tumbled 6.66 per cent, or 154.96 points, to 2,170.73.
  • Japan’s core consumer prices fell for the third straight month and household spending slumped in October, underscoring the fragile nature of the economy and keeping policymakers under pressure to take further steps to jump-start growth.The core consumer price index (CPI), which excludes volatile fresh food but includes oil costs, fell 0.1% in the year to October.
  • Gold dipped towards its lowest level in nearly six years on Friday and was on track for a sixth straight weekly decline, weakened by a robust dollar and expectations of a US interest rate hike next month.
  • The dollar is trading near an eight-month high against a basket of major currencies, boosted by euro weakness and prospects of higher US rates.
  • Crude oil futures fell on Friday with losses this month standing at over 8%, hurt by disappointing Chinese economic data and worries over a supply glut.A firmer US dollar also weighed on oil, making greenback-denominated contracts more expensive for holders of other currencies.

Welcome to Friday evening! Here are three things about Singapore’s stock market and investing in general that you might want to look at today and over the rest of the week.

1. There are lessons about investing in all areas of life – even cancer research. Jump in here to find out just how cancer research can lead us to the king of all investing strategies.

2. What would a perfect business look like? Do you think Raffles Medical Group Ltd (SGX: R01) is one? I’ve dug into both questions recently – you can check out my thoughts here.

3. Knowing what a perfect business looks like can also be useful in pointing out lousy businesses. Here’s why I think Noble Group Limited (SGX: N21) does not possess a business of high-quality.

STI MARKET REVIEW :
SINGAPORE shares were up in the early minutes of trade on Tuesday, with the Straits Times Index up 0.04% or 1.05 points to 2,904.54 and ended 20 Points or 0.69% Higher to 2,923.49.
STI came off from its intra-day peak of 2939 and low of 2898. Singapore stocks gained at noon on Tuesday, with a mixed performance among large-caps and little in the way of a strong lead from the US or other Asian markets. Straits Times Index rose 0.69% to 2,923.50. Market breadth was however negative.
LOCAL BOURSE
Singapore stocks showed mixed sentiments as the large cap performance was at equilibrium and small cap doing good.The local data showed that singapore is facing a mild deflation at around 0.5% showing a sign of concern.
MARKET FORECAST
STI is expected to go up in next trading session if it breaks its resistance level of 2940. The market has positive sentiments as it has advancedin the current session.Investors are waiting for positive trend ,as they are eager to invest in the market
Midas Holdings won contracts for metro rail and airport rail train works in China and Malaysia.Overall it has secured four contracts of which three are for metro rail projects in China, and one for an airport train in Malaysia.

  • Keppel Corp has priced the issue of its $200 million notes due 2023.The notes, issued under the US$3 billion ($4.2 billion) multi-currency medium-term note programme, will bear interest at a fixed rate of 3.725% a year. It will be payable semi-annually in arrears and will have a tenor of eight years.

  • Noble Group Ltd,have its credit rating cut to junk by Standard & Poor’s on concerns about the company’s liquidity.The ratings company placed its BBB-rating on Noble, the lowest measure for investment-grade debt, on review with “negative implications.

GLOBAL FACTORS AND WORLD INDICES:

  • The chances of Federal Reserve raising interest rates at its next meeting in December climbed to 74 per cent.The probability the central bank will act at its Dec 15-16 session increased from less than 30 per cent as recently as mid-October, futures contracts show.
  • The US dollar rose at the start of week after a holiday-shortened week packed with economic reports expected to show improvements that could support a Federal Reserve interest rate hike next month.

  • Japanese stocks posted a modest rise in choppy trade to mark a fifth consecutive day of gains as investors waited for fresh trading cues.The Nikkei share average ended 0.2 per cent higher at 19,924.89.

  • Australian shares fell 0.95 per cent in broad-based selling as falling commodities prices weighed on the index and investors took profits.The S&P/ASX 200 index fell 50.02 points to 5,226.4 at the close of trade.

  • Oil prices climbed in Asia ahead of a key meeting of the Opec and US commercial crude inventories are to gauge demand in the world’s biggest oil consuming nation.

  • Gold held a second day of declines as investors continue to expect an increase in U.S. borrowing costs by the end of the year, cutting the appeal of bullion which doesn’t pay interest.

  • Europe’s main stock markets fell at the start of trading , extending the previous losses, as investors seek shelter from tumbling commodity prices and a strong dollar.

  • China is on track to reach its economic growth target of about 7% this year, and the economy is going through adjustments to maintain reasonable medium- to long-term growth.

  • China stocks recouped early losses to end marginally higher as a late-afternoon surge in small-caps offset weakness in resource companies.The CSI300 index of the largest listed companies in Shanghai and Shenzhen ended little changed at 3,753.89 points, while the Shanghai Composite Index gained 0.2 per cent to 3,616.11.

  • Australia’s Treasury lowered its estimate of the economy’s potential growth rate, or speed limit, reflecting weaker population growth.The economy’s potential rate will be about 2.75 per cent over the next few years, down from 3 per cent estimated at the time of the budget.

STI MARKET REVIEW :
SINGAPORE stocks opened flat on Monday morning, with the Straits Times Index(STI) up 0.03 per cent, or 0.97 point, to 2,918.88 and ended lower to 10.1 points or 0.35% to 2907.80.
STI came off from its intra day peak 2925.16 of and low of 2904.80.
LOCAL BOURSE
Singapore equities initially climbed up but the market ended on a low as a result of sluggish growth of asian economy. The market was on lower side due to the increase in risks in real estate investment trusts in 2016 because of weak economic fundamentals weighing on demand, while new supply is added into most sectors.Singapore REITs is expected to come back stronger to do more acquisitions in 2016.
MARKET FORECAST
STI is expected to consolidate in next trading session. Investors are still waiting for positive trend , but market is not showing positive trend. If it breaks the level of 3018 then the market is expected to go up.As fed is likely to increase its rate and also the slowing economic growth of asia will lead towards the sidewards or downwards movement of the market for now.
STI COUNTER SPECIFIC NEWS

  • Citic Envirotech Ltd (CEL) has secured a Public-Private Partnership project in Liaoyang City, Liaoning Province, China worth $122 million.The project involves an investment into four wastewater treatment plants and its associated pipe network in Liaoyang City.

  • Singapore container shipping firm Neptune Orient Lines has entered into exclusive talks for acquisition with France’s CMA CGM SA, the world’s third-largest shipper by capacity.

  • KS Energy Group announced that a joint venture between PT Atlantic Oilfield services and PT Java Star Rig has won a contract for KS Java Star jack-up drilling rig worth US$2.8 million ($4 million).

GLOBAL FACTORS AND WORLD INDICES:

  • China stocks ended lower, with the telecoms sector leading declines and as investors remained cautious ahead of a fresh batch of listings.The largest listed companies fell 0.6 percent, while the Shanghai Composite Index lost 0.5 per cent.
  • Oil extended its decline as Venezuela predicted prices may drop as low as the mid-US$20s a barrel unless the Organization of Petroleum Exporting Countries (Opec) takes action to stabilize the market.
  • The yuan fell to a three-month low as the central bank weakened the currency’s reference rate amid a dollar advance and on concern China will allow a decline to help its economy.
  • The euro weakened toward a seven-month low after futures traders added to bearish bets and European Central Bank encouraged speculation.
  • Malaysia’s ringgit led losses in Asia on speculation as rally was overdone given that oil prices remain depressed and China’s economy is still slowing.The ringgit climbed 2.1 per cent in the five days through ,rising along with other regional currencies after the Federal Reserve indicated it will increase interest rates gradually.
  • Growing confidence that the US will raise interest rates next month boosted the dollar in Asia.US stocks capped their best week this year as investors digested growing signs the Federal Reserve thinks the world’s top economy is srong enough to handle a rate rise next month.
  • Iron ore price will drop below U$40 a metric ton before year-end, and trade in the US$30s in 2016 as demand in China sputters.
  • Europe’s main stock markets fell at the start of trading, with London’s benchmark FTSE 100 index down 0.7 per cent to 6,293.27 points, awaiting regional data.
  • Hong Kong shares fell, taking cues from weak mainland markets and as investors braced for a likely rise in US interest rates next month.The Hang Seng index fell 0.4 per cent, to 22,665.90, while the China Enterprises Index lost 0.7 per cent, to 10,229.43 points.
  • SINGAPORE inflation eased at -0.8 per cent, mainly due to the lower costs of oil-related and retail items.This meant core inflation, which excludes the costs of accommodation and private road transport, moderated as well to 0.3 per cent – lower than the previous month’s 0.6 per cent.

STI MARKET REVIEW :
SINGAPORE shares opened higher on Thursday.The benchmark Straits Times Index rose 26.91 points or 0.93 per cent to 2,912.99. following Wall Street’s gain on expectations the Federal Reserve would be confident enough about the US economy to raise rates in December. STI closed33.8 points or 1.17% higher and came off from its intra-day peak of 2932.78 and low of 2906.86.STI Chart
LOCAL BOURSE
Singapore equities climbed in line with gains seen in most other Asian bourses.The US Federal Reserve has also signalled a potential interest rate hike in December following which the market had mixed sentiments towards gaining.
MARKET FORECAST
STI is expected to consolidate in next trading session. Investors are still waiting for positive trend , but market is not showing positive trend. If STI break 2940 then it may take positive side.
STI COUNTER SPECIFIC NEWS

  • Sembcorp Marine announced last evening that it has won a contract from a unit of Modec Inc. to build a floating storage and offloading vessel.It reported earlier that one of its customers has announced the cancellation of a US$214 million ($304 million) contract for a drilling rig.
  • Linc Energy revealed that it has entered into a confidentiality, due diligence and exclusivity agreement with an Australian company in relation to its shale oil assets.The counter party has commenced due diligence in accordance with the agreement but no formal negotiations regarding the sale of the SAPEX assets have been held at this time.
  • Viva Industrial Trust announced plans to raise a total of $110 million through a private placement and preferential offering of its units.It will sell 101.1 million new stapled securities to its existing holders at $0.715 each in a ratio of one new unit for every seven held. The preferential offer is expected to raise $72.3 million.
  • First Reit is about to acquire stake in Indonesian hospital and mall for S$70m.

GLOBAL FACTORS AND WORLD INDICES:

  • Federal Reserve officials continued to flag December as a likely time for interest rates to rise after seven years near zero, with two expressing confidence they will be able to pull off a rate hike smoothly despite fears of an abrupt market reaction
  • Wall Street stocks marched higher, greeting US Federal Reserve meeting on minutes that suggested a likely interest rate increase in December.
  • US dollar dipped against the euro after the minutes of the Federal Reserve’s October policy meeting reinforced expectations of an interest rate hike next month.Most participants of the Federal Open Market Committee anticipated the US economy would be strong enough in December to weather the first rate hike in over nine years.
  • Asian stocks and emerging market currencies rallied after minutes from the Federal Reserve showed growing confidence in the US economy, ramping up the chances of a December interest rate hike.
  • Commodity markets are in worse shape than in 2009, and is trading with more risks.Oil, copper and coal are trading around their lowest levels since the global financial crisis.
  • Oil prices rose in Asian trade on Thursday as Europe struck back against the Islamic State (IS) group after the Paris attacks and after a mild rise in US stockpiles.US economy also lifted confidence, with most markets in Asia advancing following a rally on Wall Street.
  • Gold may become a three-figure commodity once again after holding above US$1,000 an ounce ($1,420 an ounce) for the past six years.Bullion may slide below the level in the first half of 2016 after the Federal Reserve raises rate and the dollar gains.
  • China stocks ended higher with a sharp rebound in small-caps offsetting the drag from property shares and investor caution ahead of a flurry of new listings.The blue-chip CSI300 index rose 1.6 per cent, to 3,774.97, while the Shanghai Composite Index gained 1.4 per cent, to 3,617.06 points.
  • Tokyo stocks rose 1.07 per cent as investors weighed the Bank of Japan’s decision to keep its monetary easing programme unchanged, pushing up the yen against the dollar.The Nikkei 225 at the Tokyo Stock Exchange rose 210.63 points to 19,859.81.
  • Shares in Hong Kong climbed more than one per cent in opening trade after minutes from the Federal Reserve’s October policy meeting showed board members had greater confidence in the US economy.The benchmark Hang Seng Index rose 1.06 per cent, or 234.31 points, to 22,422.57.

The benchmark Straits Times Index STI opened 8.78 points or 0.3 per cent lower at 2,908on Wednesday. STI came off from its intra-day peak of 2909.45 and low of 2884.03. STI closed lower to 30 points or 1% at 2890.68
LOCAL BOURSE
Singapore shares opened lower as investor sentiments were dimmed by the 16-year low in commodity prices.The investors have mixed sentiments as they are awaiting the detailed report of GDP which will be released Wednesday next week.
MARKET FORECAST
Asian stock markets are expecting to fall amid fears that the terror attacks in Paris would hurt Europe’s economic recovery. STI has taken a support of 2885 we are expecting it will go more down if it break support. Technical indicator also not supporting the STI market.
NEWS

  • Shares in Neptune Orient Lines (NOL), buoyed by news of a potential acquisition by CMA-CGM or AP Moeller-Maersk,gained 18% since it reported a 3Q loss of US$96 million.
  • Sembcorp Marine is down 2.2% at $2.20 after a customer cancels a US$214 million ($305 million) contract to build a drilling rig.
  • Wilmar is trading down 1.0% as it is stuck in a trading range until it can improve its return on equity any further.Wilmar’s management emphasised achievements in scale, distribution, vertical integration and potential to capture a share of the branded staple food market in Asia, but remains skeptical.

GLOBAL FACTORS AND WORLD INDICES:

  • Signs of possible inflation gains in the United States helped boost the dollar to its highest level against the euro since April.The dollar rose to US$1.0644 per euro, and was slightly higher against the yen but fell against British pound.
  • US stock indexes opened higher as better-than-expected earnings from Wal-Mart and Home Depot allayed fears of a retail slowdown after last week’s sharp selloff in the sector.
  • Singapore Exchange Ltd will open a dark pool for bonds entery for the institutional fixed-income for the first time next year.SGX is seeing a business opportunity in offering a platform for fixed income as regulatory changes prompt global investment banks to scale back in this segment.
  • Major European shares emerged, while US stocks held their gains from the prior session as investors continued to show resilience after Friday’s deadly terror attacks in Paris.The majority of stocks globally remain unfazed by last week’s terrorist attacks in Paris.
  • Tokyo’s benchmark stock index closed flat as investors await the outcome of a two-day central bank meeting for fresh trading cues.The Nikkei 225 at the Tokyo Stock Exchange edged up 0.09 per cent, or 18.55 points, to 19,649.18.
  • China stocks fell roughly 1 per cent as a surge in property shares in the wake of encouraging home price data was offset by slides in many other sectors as investors took profits.The market has rebounded more than 25 per cent from the low hit during the summer rout, but selling pressure is increasing as China will soon resume initial public offerings and many investors remain worried about the economy’s health.
  • Oil prices rebounded in Asia but buying sentiment remained sluggish owing to supply glut woes and a strong dollar.Traders are waiting for the release of report on commercial stockpiles in the world’s top oil consumer which is expected to show an increase and further confirm the oversupply.
  • Gold was down another $3 in the Asian session,showing that the speculators are fearless. Traders are counting down the days to the Federal Reserve meeting in December which is impacting global prices of gold as gold gains during global political stress has been moving just the opposite.
  • Hong Kong stocks slipped, taking cues from weak mainland markets which remained fragile, amid lingering anxiety over terrorism in the wake of Friday’s deadly attacks in Paris, falls in global commodity prices, and the prospect of United States interest rates rising soon.
  • Commodities like oil, copper and coal are trading around lowest levels since the global financial crisis putting growing economies in concern.