SG Market (12 Jan 15)

Singapore stocks are expected to open lower, taking cue from the negative close on Wall Street last Fri, which was weighed by an unexpected weak reading on wage growth and depressed oil prices. With Alcoa set to kick-start the US 4Q earnings season tonight, Asian investors could remain side-lined in today’s trading, preferring to await better clarity on the health of US corporates. Asian markets are mostly trading lower this morning, with both Sydney and Seoul down 0.4% and 0.3% respectively. Tokyo however tacked on 0.2%. From a chart perspective, the STI recently rebounded strongly from its 200-dma, with both ADX and MACD beginning to reverse upwards, pointing to short term upside. Near-term support is tipped at its 20-dma at 3,316, while the recent high of 3,370 would be the key resistance level. Stocks to watch: *Cosco: Profit warning for FY14 due to weak performance amid a soft oil environment. Cosco will also take a $90m write-off with regards to the Octabuoy hull and topside module, which it has been trying to resell, after the original owner ATP UK went into bankruptcy and defaulted in Jul '14. The unconventional design of the vessel compounds the difficulty of a potential sale, amid the weak oil price environment. *Ezra: Bagged a US$110m engineering and fabrication contract from Sembcorp Marine, to supply an external turret mooring system for the Libra field’s extended well test FPSO vessel. *Fragrance/Aspial/LCD Global: Fragrance Group and Aspial Corp established a 50:50 JV, to make a voluntary conditional cash offer of 33¢/share for LCD Global, subject to the cancellation or deferral of LCD's ongoing rights issue. *Federal Int’l: Profit warning for 4Q14 and FY14 due to an associate's unfavourable performance and tax liabilities, as well as additional project cost overruns and provisions for the Federal II FPSO project. *TEE Land: 2QFY15 net profit rose 46% y/y to $2.4m, while revenue soared five-fold to $15.1m due to higher progressive income recognized for Aura 83 compared to The Peak @ Cairnhill last year. Bottom-line was weighed by slimmer gross margin of 25.4%, due to higher margins recognized from development projects in the previous year, and a 76% surge in admin expenses. Interim DPS of 0.44¢ declared. BVPS at $0.335. *Keppel REIT: Reportedly reached full committed occupancy for nine of its 11 completed office towers in Singapore and Australia. Its S’pore portfolio saw an average 17% rise in rental reversions last year. Overall, the office REIT’s top 10 tenants have a weighted average lease expiry of nine years. *Edition: Non-binding MOU to form a 51:49 JV with an independent third party, to go into financial services business in China. *Lifebrandz: Received SGX's approval in-principle for its 500m new share placement at 0.36¢ apiece.