SG Market (12 Jan 16)

Downward pressure is expected to persist amid lingering concerns over the slowdown in China that continues to fuel the commodity rout.

Brent slumped 6% overnight to its 12-year low to US$31.55 per barrel on concerns over risks for a slowdown in global demand, as well as expectations that Iran will soon add to the supply glut.

Regional bourses opened mixed today in Tokyo (-1.7%), Seoul (+0.6%) and Sydney (+1%).

From a chart perspective, downside support for the STI is at 2,680 (50% Fibonacci retracement), while resistance is seen at 2,830 (20-dma).

Stocks to watch
*Sembcorp Industries: Entered MOU with Chongqing municipal government to develop renewable energy, township, property and E&C projects in the city.

*Keppel DC Reit. Industry consultant Cushman & Wakefield highlighted 47% ramp up in supply of data centres by end-2016 on sustained demand from growing tech and network-content firms. Market rents are expected to bottom out in 2017 and trend up in early-2018 when supply is fully absorbed.

*PACC Offshore/ Ezion: JV secured a contract of an undisclosed sum, to tow Shell's 1st floating LNG plant from South Korea to Western Australia. Project is due to be delivered during 2H16.

*Tigerair: Dec operating statistics saw passenger load factor lifted marginally to 86.2% (+0.1ppt y/y), amid a 1.4% decline in passenger traffic and a similar cut back in capacity.

*Cheung Woh Technologies: 3QFY16 net profit plunged 60.2% y/y to $1.6m, dragged mainly by increased FX losses and disposal loss of asset. Meanwhile, revenue edged 2.6% to $25m, driven by stronger USD/SGD which boosted the HDD segment, but partially offset by tepid demand and MYR depreciation in the precision metal stamping segment. Gross margin shrank 8.9 ppts to 22.1% from higher materials and overhead costs in China.

*Miyoshi: 1QFY16 turned into net profit of $0.4m (1QFY15: -$0.7m) mainly on group's costs savings strategy. However, revenue tumbled to $11.8m (-13.4% y/y) due to lower orders in its data storage segment.

*CapitaLand: Injected additional $3.8m capital for the development of Citadines OMR Chennai, a serviced residence in Chennai, India.

*SGX: Seeking public feedback on its proposed changes to Mainboard and Catalist Listing Rules, which include the electronic transmission of notices and documents to shareholders.

*Mapletree Commercial Trust: Entered into two five term loan facilities to borrow $190m.

*Sapphire Corp: Newly-acquired Ranken Infrastruture secured a Rmb373m ($82m) contract, to construct 1.6km of the 23.4km Taiyuan Metro-Line 2. The contract is expected to complete within 30 months.

*Cosco Corp: 51%-owned subsidiary Cosco Shipyard delivered a 111,000 DWT Tanker, Front Ocelot, to its European buyer.

*Chiwayland: Incorporated a 70:30 JV with Kunming Juhua Investment Management, to engage in investment and asset management.

*Figtree Holdings: Provided an interest-free two-year shareholder's loan of Rmb24.6m ($5.3m) to Vibrant Properties for a capital investment.

*Sinotel: Received no-objection letter from SGX regarding its voluntary delisting.