SG Market (23 Dec 13)

Market Roundup: US stocks scored new record highs capping its best weekly close in months as unexpected strong data on economic growth raise optimisim about the recovery.. Traders drew an early lift from an upward revision in US 3Q GDP growth to 4.1%, its fastest pace in two years, from a prior estimate of 3.6% due to stronger consumer spending and business investment than previously reported. Until recently, investors had viewed positive data as negative because it may prompt the Fed to trim its stilus but now that the central bank has announced its intention to pare its monthly bond purchases by US$10b, there is no real risk of further tapering any time soon. The markets pared their gains towards the close because of quadruple witching, which marked the quarterly expiration of stock/index options and futures as well as quaretly index rebalancing. The S’pore market finally breathed some life on Fri and is expected to trend higher going into the new year, propped by the traditional Capricorn effect as fund managers re-adjust their portfolios. A break of resistance at 3,100 could send the benchmark STI towards the next objective at 3,163, while support seems safe at 2,990. Stocks to watch: *SIA: Agreed on a US$62.8m settlement to resolve the US Air Cargo Class Action brought against its cargo unit, without admitting any wrongdoing or liability. Accordingly, the group will make a $78.5m provision in its financial accounts for FY14. *SIA/Tiger: SIA has acquired an additional 7.3% stake (72.3m shares) in Tiger Airways from Temasek Holdings bringing its holdings to 40%. The purchase consideration of $49m was transacted at $0.6678/share or 34% premium to Tiger's last close of $0.505/share and a 33% premium to its NTA as at Sep. Upon completion, Temasek's stake will be reduced to 48.5% from 55.8%. *CapitaMalls Asia: Formed 49/51 JV with Changi Airport Group to jointly re-develop the 3.5ha car park site fronting S’pore Changi Airport Terminal 1 into a mixed use development Terminal 1. The $1.47b Project Jewel is expected to have a GFA of 134,000 sqm offering airport facilities (17,000 sqm), leisure attractions (22,000 sqm), hotel (5,000 sqm), retail space (90,000 sqm) and 2,500 car park lots. Construction will begin in 2H14 with targeted opening by end 2018. *Swissco: Secured three contracts worth $15.2m, comprising a three-year charter for an offshore supply vessel to be deployed in Mid-East and two accommodation vessels on short term charter in South-east Asia. *Sino Construction: Received a LOI for the award of a RM40m main contract from Kota Kinabalu City Hall to build a proposed mixed commercial development cum bus terminal with built-up space of 410,436 sf in Kota Kinabalu, Sabah, Malaysia. *Cambridge Industrial: Proposed to acquire the industrial property at 11 Chang Charn Road, S’pore for $32m. The property, which has remaining land tenure of 43 years, comprises a six-storey purpose-built warehouse cum light industrial building with GFA of 9,062 sqm. The vendor, Shriro Property will take a partial leaseback while the remaining subsisting sub-leases will be assigned to Cambridge on completion. *ARA: Acquiring Macquarie Real Estate Korea, a real estate management company based in Seoul that manages two privately held Korean REITs (K-REIT) with combined AUM of ~US$554.1m. ARA will also acquire a 10% stake in one of the K-REITs, co-investing alongside one of Korea’s largest pension funds, which is also the sole investor in the second K-REIT. *Yoma: Extended the long-stop date for its proposed acquisition of a landmark development in Yangon to 30 Jun 2014 from 31 Dec 2013 due to ongoing talks with government authorities over the terms of its master lease. Meantime, the group is finalising details with partners The Hongkong and Shanghai Hotels and Mitsubishi Corp on the design and planning of the project and financiers IFC and Asian Development Bank on a debt and equity financing package. *Noble: Acquired a 21.2% stake in ASX-listed coal miner Cockatoo Coal for A$43.3m, making it an associate company. *Courage Marine: Acquired a 72,000 dwt panamax vessel (MV Hsin Ho) from Taiwanese shipping firm Ta-Ho Maritime Corp for US$8.6m. The vessel, expected for delivery in Jan 2014, is part of the group's fleet renewal programme. *Tritech: Announced intentions to switch its proposed spin-off and listing of its limestone business to the Catalist Board on SGX instead of SEHK after taking into consideration the regulatory requirements of both exchanges. However, the listing process is still in preliminary stages and no approval have been obtained from SGX. *Blumont: Disclosed that its proposed subscription for US$100m convertible bonds in Discovery Metals has lapsed after precedent conditions have not been met and the term sheet has been terminated. *Religare Health Trust: Entered into forward currency hedging contracts based on management estimates of incoming rupee cashflow for FY14 in order to meet its projected distributions. *Guocoleisure: Has resolved to delist from the NZX mainboard wef 27 Jun 2014. Following the delisting date, Guocoleisure shares may be traded only on SGX, where it maintains its primary listing.