SG Market (10 Jun 14)

US Market: US shares extended their record run amid a small cap rally and string of M&A activity. The DIJA rose 19 pts to 16,943 (+0.1%), while the S&P 500 edged up 2 pts to 1,951 (+0.1%) and the Nasdaq advanced 15 pts to 4,336 (+0.3%). Valuations are stretched but still within the upper limits of the historical range. Industrial stocks (+0.6%) and small caps (+0.9%) led the gainers, while utility firms (-0.7%) declined. In deal news, Tyson Foods slid 6.5% after beating rival Pilgrim’s Pride (-6.7%) with a binding bid of US$63/share for Hillshire Brands (+5.3%), while Idenix Pharmaceuticals soared 229% after Merck (+0.2%) offered to buy the Hepatitis C drugmaker for US$3.9b. Separately, Analog Devices jumped 5% after agreeing to buy radio chipmaker Hittite Microwave (+29%) for US$2b. Amongst other stocks in focus, Apple gained 1.5% as investors remained upbeat on the tech giant following its 7-for-1 stock split, while discount chain Family Dollar jumped 13.4% after billionaire investor Carl Icahn disclosed that he had accumulated more than a 9% stake in the discount chain. Rival retailer Dollar General surged 7.4%. With regional markets in Tokyo (+0.3%), Seoul (+0.5%) and Sydney (+0.6%) heading higher this morning, the STI is tipped to push towards its immediate resistance at 3,320 with the next hurdle at 3,355. Downside support now lies at 3,285, near its 20-day moving average. Stocks to watch: *GLP: Signs build-to-suit agreement with Deppon Logistics for a 25,000 sqm distribution centre at GLP Park Jinjiang in Xiamen, China. Deppon is one of GLP’s biggest customers, leasing 17 facilities across China. *Ley Choon: Secured six contracts worth $20.4m from PUB for the supply and laying of water pipes/mains at various locations in S’pore from 2014-16. The latest contracts will lift its new orders for the water/sewer segment to $58.7m and order book to $201.4m. *Tritech: Awarded $7m contract by the LTA to provide and operate a tunneling and excavation monitoring system over five years from Jun ’14 to Jun ’21. *AusGroup: Awarded contract for the supply of scaffolding material to the Chevron-operated Gorgon project in Western Australia. *Sheng Siong: Granted option to purchase a three-storey HDB commercial property at Tampines Central for $65m or $1,558 psf. The 99-year leasehold property has a gfa of 3,876 sqm and comes with existing tenancies that expire between 2014 and 2018. Part of it will be converted to a new 910 sqm store by 1Q15 and progressively enlarged as the rest of the tenancies expire. *LCD Global: Mandatory conditional cash offer by controlling shareholders Raymond and David Lum received valid acceptances amounting to 3.7% of share capital, raising their stake to 35.8%; closing date of $0.17 share offer extended to 23 Jun from 9 Jun. *Delong: Updated that discussions with various parties relating to a possible transaction are still ongoing but there is no certainity that a deal will materialise. *Interra Resources: 60% jointly controlled entity, Goldpetrol has completed development in CHK 1186 in Chauk oil field in Myanmar. *UMS: CEO Andy Luong disposed 3m shares at an average price of $0.674 on 6 Jun via the open market, shaving his stake from 22.9% to 22%.