Friday, April 1, 2016

SG Market (01 Apr 16)

SG Market: Investors are likely to stay by the sidelines ahead of key economic data from China and US today.

Regional bourses opened weaker in Tokyo (-1%), Seoul (-0.5%) and Sydney (-1.6%).

From a chart perspective, topside resistance for STI remains at 2,900 with underlying support at 2,820.

Stocks to watch:
*Banks: Rating agency Moody's downgraded the outlook for the three local banks from stable to negative, on the back of increased challenges in the operating environment in 2016. MKE is also negative on the sector- DBS (Sell, TP: $12.68), OCBC (Sell, TP: $7.20) and UOB (Hold, TP: $16.96).

*Consumer: Consultant McKinsey expects consumption to grow at 3% CAGR from 2015 to 2030, with 50% of the growth coming from consumers >60 years of age.

*Noble: Forms new coal procurement JV with Japanese utility company Shikoku Electric Power. It will be directly involved with coal producing companies in Australia and have access to Shikoku's long term equity, marketing and supply agreements.

*POSH: Renewed its Petrobras contract for semisubmersible accommodation vessel POSH Xanadu for another year. MKE estimates the new dayrate is likely to be 30% below the previous US$175k/day. House maintains Buy with TP of $0.42.

*CNMC Goldmine: Independent valuer has revised up the estimated gold resources at its Sokor project in Kelantan by 22% to 618,000oz as at end-2015, and found increased silver (+15%), lead (+67%) and zinc (+51%) resources at Manson's Lodge, one of four areas in the field.

*Frasers Centrepoint: Australian townhouse development Park Gallery in Brisbane's Marina precinct was sold out in less than four months, with sales of $28.7m.

*SATS: Signs JV agreement with Oman Air for cargo handling at Muscat International Airport. SATS will invest OMR6.4m ($22.5m) or 17.5x P/B for a 33% stake in the JVC, which owns Oman Air's cargo handling business and related assets.

*Ezra: Chiyoda completes its investment in Ezra’s subsea services business, EMAS AMC, forming a 50:50 JV EMAS CHIYODA Subsea.

*Singtel: Signs MOU with SubPartners and Telstra to build an 4,500km submarine cable connecting Perth and Singapore. Construction is expected to commence by end-Jul '16 and scheduled for completion in 2018.

*Engro Corp: Incorporated a 40:60 JV Xin-shan Ang-de (Zibo) Materials in Shandong, China, to produce and distribute high performance concrete.

*Resources Prima: Enters agreements with its waste mining contractor PT Cipta Kridatama (CK) to reduce mining rate by 11% to US$2.00 per bcm, and for a debt repayment extension for sums owed to CK from Dec '16 to Dec '18.

*Jubilee Industries: Disposing a property in Johor, Malaysia, for RM5.1m ($1.7m), 13.6% under its market valuation and 1% below book value. Proceeds are intended for general working capital or business opportunities.

*Darco Water: Signs MOU with Aquaporin Asia to jointly pilot low-energy Zero Liquid Discharge systems for industrial wastewater treatment based on the Aquaporin Inside Forward Osmosis Technology.

*CapitaLand Commercial Trust: Issued HK$585m fixed rate notes due Mar 2021.

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