SG Market ( 10 Mar 14)

US Shares hit at a new record high with the S&P500 closing at 1,878, buoyed by positive jobs data which showed that US employers added 175,000 jobs to their payroll in Feb versus estimates of 149,000 jobs. Trading remained volatile coupled with lower than average volume as investors kept close tabs on the ongoing crisis in Ukraine, and after some analysts cautioned of a build-up in overbought technical indicators. Financial stocks continued to outperform, with the S&P Financials index closing at a five-year high, as positive sentiment continues to mount on US banks capital levels ahead of stress tests. Despite the positive US display, markets could see a knee jerk reaction today after data from China showed that exports slid the most since 2009, down 18.1% y/y versus estimates for a 7.5% increase. Separately, China’s inflation rate fell to 2% from 2.5% in Jan’14, stoking concerns of deflation. Regional markets opened lower this morning, with the ASX down 0.8%, Nikkei down 0.3% and Kospi down 0.8% as at 8.40 am. Latching on the regional markets performance, the STI is expected to open lower with downside support seen at 3,092 (50d simple moving average). Stocks to watch *OCBC: Private Bank, Bank of Singapore (BOS) is aiming for an asset under management (AUM) growth of 15% in FY14, after having spent FY13 restructuring and strengthening its back office operations. With current AUM at US$46b, BOS’s AUM could hit US$80b by 2017 if it maintains its current growth trajectory. BOS highlighted that an area of focus going forward would be greater China, where its parent OCBC is currently in negotiations to buy over Hong Kong’s Wing Hang Bank. *Amtek Engineering: In an interview by Bloomberg, Amtek aims to double its sales to $2b over the next five years via acquisitions, guiding for automotive products to fuel that growth. Amtek expects auto companies to contribute at least 40% of the group’s total revenue over the next two to three years, from the current 18%. *Lorenzo International: SGX has granted its approval-in-principle for the listing and quotation of up to 43.3m new shares in the capital of the company via a proposed placement. *China Developers: S&P warns that its ratings on China developers could face downward pressure as their debt increase outpace property sales, highlighting the growing risks of Chinese developers to overseas debt which has been rekindled by the recent bouts of volatility in the Rmb. *FTSE ST Small Cap Index: 9 stocks will be included in the FTSE ST Small Cap Index. The nine stocks are Del Monte, Lin Energy, Pacific Radiance, OUE Commercial REIT, Soilbuild Business Space REIT, CEnturion, OKH Global, Zhongmin Baihui and Riverstone. The additions will come into effect on 24th Mar'14. 15 other stocks will however be excluded from the index, of which current constituents Rowsley, OUE Hospitality Trust and Asian Pay TV Trust will join the FTSE Mid-Cap Index, replacing Mandarin Oriental, Fortune REIT and Hotel Properties.