SG Market (02 Jan 15)

S’pore shares are likely to take a breather at current levels in the absence of key catalyts. From a chart perspective, tecninicals indicators are stretching into overbought territory. Downside support for the STI could be found at 3,360 (resistance turned support) followed by 3,315 (20-dma), with upside capped at 3,388. Stocks to watch *Economy: Singapore GDP expanded 1.5% y/y in 4Q14, lower than estimates of 1.8%, weighed by a weaker manufacturing sector (-2%) due to the slowing growth in China and an uneven global recovery. This brought overall growth in 2014 to 2.8%. *Keppel Corp: Secured a second vessel contract worth US$705m from Golar LNG to convert a Moss LNG carrier into a floating liquefaction vessel. *United Engineers: OCBC and Great Eastern Holdings have extended the exclusivity agreement with TCC Top Enterprise to 30 Jan 2015, in relation to a possible sale of their combined stakes in United Engineers. *Soilbuild: Won $128m worth of contracts from HDB for the construction of six blocks of flats at the Sembawang Neighbourhood and Park over a 36-month period. *STATS ChipPAC: Planning to relocate its Shanghai manufacturing site to a new site due to long term zoning, development and construction plans for the West Hongqiao area. *Japfa: Entered into strategic five-year milk supply agreement with Inner Mongolia Yili Industrial Group, China’s second-largest dairy producer by revenue. Japfa will supply 500 tons of raw milk per day to Yili from 2015 to 2019. *Second Chance: 1QFY15 net profit plunged 55.8% to $1.7m, while revenue slid 4% to $8.8m, dragged by the apparel business (-16.4% to $2.25m) due to the closure of six outlets and lower rental income from its properties (-2.9% to $2.33m). Bottom line was also weighed by a $1.5m unrealized loss on financial assets held for trading purposes. BVPS at $0.3873. *Spackman Entertainment: Acquired 51.4% stake in UAA Korea, after exercising convertible notes worth US$2m ($2.6m). UAA is a Korean talent management company, anchored by artists such as Song Hye-kyo, Gang Dong-won, and Yoo Ah-in. *Enviro-Hub: Ceased the option, upon expiry, on its proposed sale and lease-back of retail building, PoMo, at 1 Selegie Road. *Abterra: Non-binding MOU on a proposed acquisition of a commercial site in Beijing, China, which has four buildings with total gfa of 10,735.38 sm. The acquisition is in line with the group's strategy to divest into the property business. *China Minzhong: Both CEO and CFO, Lin Guo Rong and Siek Wei Ting, are considering a management buy-out of 347m shares (~52.94% stake), from parent, PT Indofood Sukses Makmur, at $1.20/share (39.5% premium to last close) via vehicle CMZ BVI (held by CFO Siek Wei Ting on trust for Lin).