SG Market (18 May 16)

SG Market: Market could pull back from yesterday's technical bounce after strong US economic data erased Mon’s Wall Street advance and renewed investor concerns about Fed rate hikes.

Regional bourses opened mainly in negative territory in Tokyo (flat), Seoul (-0.9%) and Sydney (-0.9%).

From a chart perspective, STI likely to close the bottomside gap at 2,740 in near term, with resistance at 2,805.

Stocks to watch:
*Noble: Fitch cut Noble’s long term debt rating to BB+ (junk) from BBB- to reflect its shift in debt structure towards shorter term financing, which will result in a weakening maturity profile.

*First Resources: Apr FFB harvest tumbled 18.4% to 172,219 tonnes, on lower yield of 1.1 tonnes/ha (Apr '15: 1.5 tonnes/ha). CPO production also slid 21.6% to 40,918 tonnes, although extraction rate was slightly higher at 23.1% (+0.2ppt).

*SIA Engineering: Signs two-year contract with Tigerair Australia to undertake heavy maintenance services, with an option to renew for an additional year.

*China Everbright Water: Secured Qingdao wastewater treatment upgrading project (Maidao Plant), with total investment of Rmb208m.

*Yanlord: Entered JV with bigwigs China Ping An Insurance, Tianjin Realty Development and Beijing Capital to acquire a land parcel in Tianjin for Rmb2.37b. The 351,338 sqm gfa site will be developed into a mixed used development.

*Q&M: Terminated the proposed acquisition of Orchard Scotts Dental and De Pacific Dental Group, after terms of the agreement have not been met.

*mm2 Asia: Signed term sheet with US producer BoulderLight Pictures, to co-produce mm2's first US film "Good Match".

*IPS Securex: Received two purchase orders for the supply of Hyperspike acoustic hailing devices for US$2.9m.

*Union Steel: Proposed acquisition of loss-making O&M engineering services provider Transvictory Holdings for $15m, or 1x P/B. Pro forma FY15 loss per share is estimated to widen to 23.9¢ from 21.4¢.

*Secura: Appointed as non-exclusive authorised reseller of CyberArk's cyber security products within Singapore for one year. The contract will be renewed automatically on an annual basis unless terminated by the parties.

*Lereno Bio-Chem: Terminated proposed acquisition of 60% stake in HTwo Education after conditions cannot be met.

*Hyflux: Retail offering of up to $300m perpetual securities at 6% p.a. in the first four years, with an option to increase to $500m. Distribution rate will be reset every four years. Part of the proceeds will be used to repay $100m outstanding notes issued under its $1.5b multicurrency debt programme as well as $175m of its perpetual securities, while the rest will go towards general corporate purposes, including repayment or refinancing of existing borrowings.