SG Market (16 Dec 13)

Market Roundup: US stocks ended Fri’s session little changed after a three-day slump, posing a second weekly loss in a row on concern that th Fed could start winding down its monetary stimulus this week. The FOMC meets on Dec 17-18 and will announce any decisions on Wed. Investors in US-based funds withdrew US$6.5b from equity mutual funds last week in its biggest weekly outfow this year. To some extent, the market is showing signs of indigestion and sicounting the possibility of a taper this week. However, some market watchers believe that the central bank will err on the side of caution and try to prempt its intentions well in advance and since it has not done so, it suggests the Fed will not act till spring. The broad-based S&P 500 closed right above the 1,775 support level, showing no signs of investor panic. The S’pore market staged technical rebound from oversold levels last Fri but is expected to stay with the 2,990 support and 3,100 resistance limits ahead of the Fed meeting and Christmas holiday. Stocks to watch: *Albedo: Acquiring an additional six parcels of land totalling 520 acres belonging to Malaysian tycoon Danny Tan at a 16.6% discount to market valuation that will bring its total Iskandar landbank to 13 parcels of 1,183 acres, including Lido Waterfront, a prime waterfront commercial site. The group will now issue 39.5b shares @ $0.047 representing 95% of the enlarged share base instead of the initial 34.6b shares @ $0.0224/share to Infinite Rewards, doubling its RTO deal to $1.86b from $774m and effect a 7-into-1 share consolidation. Separately, Albedo is also negotiating to acquire a 228-acre property in Pulai, north of Iskandar's Nusajaya development from Kawasan Mestika Sdn Bhd. *Tiger Airways: Signed alliance with Scoot to further align commercial activities, enabling passengers from outside S’pore to purchase itineraries involving the services of both airlines and include joint operation, sales and marketing of parallel routes, which will offer customers increased flexibility and flight options. Separately, Tigerair has signed a three-year interline agreement with India’s budget carrier SpiceJet, allowing a seamless connection between 14 Indian cities and S’pore connecting via Hyderabad’s Rajiv Gandhi International Airport from Jan 14. *FJ Benjamin: Terminating its exclusive distributorship agreement with Sowind for Girard-Perregaux watches in North Asia and Southeast Asia upon expiry on 28 Feb 2014. The manufacturer will repurchase all of the group’s remaining inventory of watches and accessories at the landed cost, valued at ~$30m. *IEV Holdings: Secured a five-year gas sales agreement from PT Ultrajaya Milk Industry to supply >500 mmbtu of compressed natural gas to its manufacturing plant in West Java, Indonesia. At the minimum off-take and contract price, the GSA is expected to yield revenue in excess of US$8m over the period from Oct 13 to Sep 18. *Loyz Energy: Schlak #3 well in North Dakota, USA, drilled in collaboration with Fram Exploration ASA (operator) and Rex Oil & Gas (partner), will be the first well to be put on production, following an oil discovery. Stable early production is ~50-60 bpd. *Transview: Issued a profit warning of a net loss in FYOct13 due to a write-off of three parcels of land (from negative coal mining survey) in Kalimantan Timur, Indonesia and decline in fair value of an an investment below acquisition cost due to the slowdown in the Australian mining sector. *Medi-Flex: 4QFY2013 net profit rose 37% y/y to RM7.1m in line with the 33% growth in revenue to RM58m on the back of increased capacity from new and refurbished nitrile lines to meet growing nitrile demand. Separately, the EGM for shareholder approval for its delisting (initially proposed by parent, Top Glove, who owns 80%) will be held on 30 Dec 2013