SG Market (21 Jun 13)

SG Market: S’pore shares are poised to gap down after Wall Street plunged more than 2% in the heaviest trading of the year as investors were rattled by fears the Fed is preparing to wind down its monetary stimulus and on disappointing China data. The Volatility Index or VIX surged 23% to 20.49 to exceed 20 for the first time this year. Supporting the early withdrawal of quantitative easing, existing home sales climbed 4.2% in May, more than forecast and a measure of manufacturing activity in mid-Atlantic region surged to a two-year high in Jun. Meanwhile, interest rates continued to spike with the 10-year bond yield rising 6 bps to 2.42%. Both the blue-chip Dow and broad-based S&P 500 have broken below their 50-day moving averages, suggesting a mid-term correction is underway. Weighing on the negative sentiment was data from China that showed manufacturing shrank in Jun, while the overnight inter-bank rate soared to 25%, indicating a credit crunch. Investors are pulling money from emerging markets at the fastest pace in two years. According to EPFR Global, more than US$19b left funds investing in developing markets in the three weeks to 12 Jun, the most since 2011. From a longer term perspective, the monthly STI uptrend has broken down with the next major support at around the 3,000 level. Overhead resistance is at 3,195, represented by the 200-day moving average. Stocks to watch for: *CapitaLand: Puts top bid of $366m ($908 psf land cost) for 99-year leasehold site at Coronation Road in the prime Bulit Timah area. The tender attracted 12 bidders with second highest bid of $313m coming from East Organisation. The group plans to build landed housing comprising semi-Ds and bungalows on the 403,000 sf site, to be ready for launch ~2Q14. *Ryobi Kiso: Secured additional contracts worth $37.3m comprising foundation and geoservices works for a range of rail and property projects in Western Australia and Singapore. This brings the total contracts bagged since 1 Jan to $55.4m. *Mencast: Its energy division has won two long term contracts from an oil major. The two environmental remediation contracts were for the setting up and maintenance of a sludge dewatering press system from Apr 13 to Mar 16 and rental of vacuum trucks and supersuckers from Mar 13 to Mar 18. *GuocoLand: Disposing a 30-storey block of service apartments together with 145 car park lots for Rmb588.2m. The service apartments total GFA of 31,067 sqm. The sale is expected to be completed by 1Q14. *Lee Metal: Granted options by NH Enterprises to acquire two industrial properties in Tuas for $15.3m and an industrial property in Jalan Bukit Merah for $2m, subject to approval of JTC and SLA respectively. *Foreland Fibretech: Warns of a significant drop in revenue and a loss for 2Q13 but reassures that the relocation of the existing production facilities from the current factory site to a new production facility, which commenced in Dec 12, has been completed in June 2013. The group will announce its 2Q13 results on or before 14 Aug 13. *APTT: JPMorgan, the stabilising manager for its IPO, has purchased a total of 71.8m units and ceased price stabilization as of 20 Jun. The total number of units which had been over-allotted during the IPO has been fully covered by the purchases made under the price stabilizing action. *Goodland: Transfer from Catalist to Mainboard wef 25 Jun, 9am