SG Market (05 Jul 13)

SG Market: S’pore shares may get a slight lift from the rally in European stocks as the ECB held its key rates steady at a policy meeting and ECB President Mario Draghi pledged to keep the monetrary floodgates open for an extended period in light of eurozone risks. Greece is also reportedly close to a deal with its EU/IMF creditors on cutting state jobs, which will pave the way for the next bailout drawdown, while Portugal’s political crisis appears to be calming down. But investors are likely to remain cautious as the US markets return to action on Fri when all eyes will be on the nonfarm payroll report due to be released. Economists expect the US economy to add 165,000 jobs in Jun, down from 175,000 the previous month. Upside resistance for the STI remains at 3,200 (represented by the 200-day moving average), while underlying support is at 3,090. Stocks to watch for: *Yangzijiang: Secured new shipbuilding contracts for 15 vessels (mainly bulk carriers) worth total usd414m, with delivery scheduled 2015 to 2016. In 1H13, it clinched a total of 27 shipbuilding contracts worth US$1.01b and now has 51 options worth US$2.64b, of which 22 are for containerships worth US$1.56b and 29 for multi-purpose bulk carriers worth US$1.08b. Group also acquired the balance 49% stake in Jiangsu Yangzi Changbo Shipbuilding Com making it a 100% owned subsidiary. *UE: Plans to sell its mixed-use development UE BizHub East at Changi Business Park for $518m to Viva Industrial Trust Management, which will inject the asset into an industrial REIT. UE will net $86.7m gain from the divestment and will continue to manage the business park (413,500 sf), retail spaces (91,500 sf) and operate the 251-room Park Avenue Changi hotel for a five-year term. If the sale goes through, UE will be granted the right to subscribe for 5% of the proposed Viva Industrial Business Trust in its planned listing. *AusGroup: Awarded a three-year plus three-month extension calcinier overhaul and maintenance contract with Alcoa Australia, estimated to be worth A$36m. Following this latest contract, the group’s order book now stands at A$252m. *Cordlife: Indian unit, Sciences India, attained accreditation from AABB, a not-for-profit body representing individuals and institutions involved in field of transfusion medicine and cellular therapies. Accreditation is for activities relating to processing, storage and distribution of cord blood. *Yanlord Land: Sold 94.3% or 336 or the 356 apartment units during the weekend launch of its Yandlord Yangtze Riverbay Town (Phase 3) in Nanjing, China at an average price of Rmb2,529 psf. The total contracted pre-sales amounted to ~Rmb1.21b.