SG Market (08 Jan 14)

Market Roundup: US stocks notched its first gains of the year, snapping a three-day losing streak on a solid Nov trade data and gains by healthcare stocks, ahead of Fri’s jobs report and start of 4Q earnings season this week. The US trade deficit narrowed more than projected in Nov to a four-year low of US$34.3b as oil imports fell and exports climbed to a record, signaling a stronger economy and adds upside risk to 4Q GDP growth forecast. Shares got a boost from the Senate approval of Janet Yellen to succeed ben Bernanke as the next Fed chairman on Feb 1, along with encouraging comments from Fed officials. Boston Fed chief Eric Rosenberg suggested that the central bank should only wind down its bond-buying programme gradually. Separately, San Francisco Fed President John Williams reckons the Fed will likely end its bond purchases this year amid newfound momentum in the economy. Firm overseas markets also provided a lift as European stocks pushed higher after the euro-zone inflation fell below the ECB target in Dec, putting pressure on the central bank to respond with further stimulus measures Accelerating earnings growth will pave the way for the market to extend its bull run this year. According to Bloomberg estimates, earnings for S&P 500 companies are expected to rise 9.7% on average this year, about twice that of 2013. With sparse corporate news and the market still working off its overbought levels, the STI is still expected to range-trade between 3,100 support and 3,160 resistance points with penny stocks still taking the limelight. Memstar may draw some interest after well-followed stock investor Alan Wang disclosed a 5.4% stake in the water membrane firm. Stocks to watch: *Memstar: Astute stockmarket investor, Alan Wang of Asdew Acquisitions has emerged a substantial shareholder after acquiring 11.9m shares @ $0.10 on 6 Jan, taking his stake past the 5% mark from 4.9% to 5.35% (142m shares). *TEE Land: Acquired the popular Long House Food Centre along Upper Thomson Road for $45.2m, which translates to $888 psf ppr based on a gross plot ratio of 3x. The property developer intends to re-develop the 1,575.6 sqm freehold site into a four-storey commercial cum residential development. *Koh Brothers/Heeton: A JV between Koh Bros unit Changi Properties and Heeton Homes has put in the top bid of $198.9m for a 99-year Jurong West Executive Condominium site in a hotly contested tender. The price works out to $382 psf ppr with a breakeven cost of ~$750 psf. Some 485 units are expected to be built on the 17,285 sqm site. *Chasen: Adds $10.6m worth of new contracts, including a $7.4m cross-border relocation of a TFT LCD manufacturing plant for a Korean company to Guangzhou, China. Separately, the group also set up a facilitised refurbishment and testing centre to service a Japanese OEM in the refurbishment of wafer fab machine tools. *Sound Global: Ahead of its voluntary delisting from SGX, the last trading day in the shares will be 10 Jan 2014.