Monday, June 13, 2016

SG Market (13 June 16)

SG Market: Investors are likely to take profit and hold off fresh positions in anticipation of a packed week of central bank meetings, US/China economic data and MSCI decision on China A-share inclusion.

Regional bourses opened in the red in Tokyo (-2.1%) and Seoul (-1.4%). Sydney market is closed for Queen's Birthday.

From a chart perspective, STI could find next support at 2,790, with topside capped by previous support turned resistance at 2,830.

Stocks to watch:
*Strategy: MSCI will decide tomorrow on the potential inclusion of Chinese-listed shares in its emerging markets index. If implemented, this could have an impact on current MSCI country weightings as funds re-adjust their allocation to accommodate the massive China market.

*Frasers Logistics & Industrial Trust: IPO priced at $0.89/unit, indicating a distribution yield of 6.8%/7.3% in FY16/17 for its portfolio of 51 Australian industrial properties worth $1.6b, and attracted 6x oversubscription for its placement tranche. Public offer between 9pm on 10 Jun and 12pm on 16 Jun; trading debut expected on 21 Jun.

*Ezra: Divesting 10% stake in 50% owned JV EMAS Chiyoda Subsea to new strategic partner Nippon Yusen Kabushiki Kaisha (NYK) for US$14.4m (1.2x P/B) to fortify its presence in the Japanese and international markets. Post sale, Ezra, Chiyoda and NYK will hold 40%, 35% and 25% in the JVCo.

*Noble Group: Appointed Morgan Stanley and HSBC to advise on the sale of its prized energy business, with deal completion targeted in 2H16.

*Genting SP: Retrenching 400 staff out of 12,000-strong workforce to right-size its headcount to meet business needs, citing regional slowdown and slower higher roller traffic.

*Tiong Seng: Awarded $98.3m worth of contracts from PUB for the supply and installation of steel potable water pipelines.

*OKP: Secured $54.7m LTA projects for road resurfacing works, boosting construction order book to $376.8m.

*Q&M: Announced the proposed spin-off of its operating dental hospitals and clinics and a dental equipment distribution company on the Catalist board.

*City Dev: Subsidiary City e-Solutions extended the exclusivity period for a potential takeover offer for another 45 days to 26 Jul.

*Spackman Entertainment: Recent production "Life Risking Romance" will be screened at the 19th Shanghai International Film Festival, and is expected to be released in Korea and China in 2H16.

*Xpress: Proposed to acquire 70% of e-commerce developer Amplify Me for $1m (5.4x P/B; 47.6x P/E) via cash ($0.5m) and new shares issue at $0.75 each.

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