SG Market (01 Oct 13)

SG Market: S’pore shares may be in for another volatile session following declines on Wall Street as the deadlocked US Congress headed for a potential government shutdown in 17 years without signs of a budget solution. Investors were also unsettled by political troubles in Europe as the Italian government teetered on the edge of collapse and China’s manufacturing rose less than estimated in Sep. Both the Senate and House of Representatives offered counter proposals, which the other side has rejected. Republicans and Democrtas remained at odds over including President Obama’s health care law in the funding bill. Even if the budget fight is resolved, lawmakers would still face the next fiscal dispute over raising the $16.7t debt ceiling. However, maket losses were moderated amid some hope that a last minute compromise might avert a shutdown. Fowwing the market drop yesterday, the STI is currently sitting just above its 50-day moving avarege at 3,166. A break below this support may take the index to the next level at 3,136 from where the STI gapped up on 13 Sep. Topside resistance lies at 3,200 psychological level. On the corporate front, Rowsley goes ex bonus warrant today. Stocks to watch for: *Noble Group: Committed to invest US$500m in X2 Resources, which is seeking producing or near producing metals and mining ventures. In return, X2 will use Noble as its preferred marketing partner and provider of supply chain management and logistics services. *TA Corp: Secured two contracts worth $77.3m comprising a $60.2m project to construct condominium development at Marine Parade Road for CapitaLand, and a $17.2m mixed landed housing project at Whitley Road for Unique Resi Estate (40% owned by KSH, 30% Heeton, 30% Zap Piling). Work is scheduled to commence by end 2013 for both projects with completion between 24-34 months. *CNMC Goldmine: Its Sokor Gold project produced 3,419.51 oz of gold dore bars in Sep 13, which is the highest record for monthly output since the start of gold production in Jul 10. The improvement was due to: 1) higher gold grade ore processed in the first leach yard, 2) commencement of production of the second leach yard, and 3) enhancements made to the leaching process, with the combined expertise of partner China National Gold Group Corp. In line with the group’s strategy of ramping up gold production, construction of a third leach yard is in progress and is expected to be completed by 4Q13. *Mirach Energy: Updated that production volume at Kampung Minyak Oil Field currently yields 126 bpd, up from 100 bpd in Aug. This follows the completion of KM-611, which was spudded on 5 Sep, and is currently producing a stabilised oil flow rate of around 36 bpd. *Swiber/Vallianz: Swiber has sold its 50% interest in Rawabi Swiber Offshore Services to 28.9% associate, Vallianz for US$1.45m. Following the acquisition, Vallianz’s consolidated order book has now expanded 27-fold to US$334m, mainly due to an ongoing contract with additional option to charter AHTS vessels to a leading oil company in the Middle East. *Otto Marine: Entered into two bareboat charter agreements to charter two work maintenance vessels to sister company Expro Synergy, in which Go Marine Ship Management, a 90% owned subsidiary has a 49% stake. *Renewable Energy: Disclosed that it has not received the outstanding subscription monies of $4.1m for 82.6m new placement shares from placee Grand Sea Int’l by the agreed deadline of 30 Sep 13. The group is considering its next course of action. *Xpress Holdings: Returned to the black with FY13 net profit of $2.7m and revenue of $23.7m for FY13, reversing a loss of $4.6m in previous year. This came on the back of better gross profit margins, higher FX gains, reduced operating expenses and lower debt provisions. *Lifebrandz: FY13 revenue dropped 13% to $25.4m, mainly due to fewer operating outlets but net profit turned positive to $0.2m from a loss of $3.3m in the previous year, through cost control and reduced expanses.