SG Market (16 Dec 14)

With negative macro news flow all around, investors are adopting a risk-off approach. Mirroring yesterday morning, the Nikkei and Kospi are currently down 1.7% and 0.6%, respectively. Coupled with the overnight sell-off in the US market, expect the STI to open on a weak note today. From a chart perspective, the STI’s break of the psychological 3,300 level suggests that the index could move down to test the next support at 3,274 (50 day moving average). Stocks to watch: *Olam: Acquiring Archer Daniels Midland's global cocoa business for US$1.3b. Completion of the deal will propel Olam to become one of the world's top three cocoa processors. The transaction is expected to be accretive in its first full year. Management guides for segmental EBITDA growth of 86%-95%, overall group EBITDA growth of 20%-22% and bottom line growth of 25%-30% by FY18. *City Dev (CDL): Partnering Blackstone and CIMB to create a $1.5b investment platform that will invest in CDL’s properties in Sentosa Cove (Quayside Collection), comprising - W Singapore (hotel), Quayside Isle (retail) and apartments of the Residences at W Singapore. CDL will continue to manage the Quayside Collection. Upon completion, net gearing of CDL is expected to improve from 36% to 25%. Based on FY13 numbers, CDL’s NTA per share will rise by 4.3% to $8.98 post transaction. *SIA: Its Indian JV airline, Vistara received the Air Operator Permit (AOP) from India’s aviation authority to begin commercial operations. *Yoma: Received loan approval for up to US$100m from the Asian Development Bank, to improve infrastructure connectivity in Myanmar. *Yongnam: Secured two orders worth $22.8m comprising i) a specialist civil engineering contract in Hong Kong for the Central-Wan Chai Bypass Tunnel, and ii) a contract for addition and alteration works for the Trisonic Wind Tunnel in Singapore. *Ryobi Kiso: Clinched $56.3m worth of new contracts for foundation works and geoservices works for infrastructure projects and large development projects. Total contracts secured year-to-date amount to $235.5m. *Kori: Won two contracts amounting to $52.9m for strutting works related to the Marina Bay and Stevens stations and tunnels located along the Thomson Line MRT. *Sysma: Won a $13.5m contract to erect a two-storey detached dwelling house with basement at Ridout Road. *Tee Int’l: Its 50%-owned infrastructure engineering associate CMC Communications is proposing to list on Catalist Board of SGX. *Spackman Entertainment: To receive KRW2b ($2.4m) in advance ancillary distribution (post-theatrical) rights from KT Hitel for four of its future productions. *Hankore: Financial year-end changed from Jun to Dec