SG Market (05 Sep 13)

SG Market: S’pore shares are unlikely to make any headway in the absence of major catalysts even as US stocks closed higher on strong batch of economic and corporate news. The Fed’s Biege Book survey showed the economy grew at a modest to moderate pace led by consumer spending and manufacturing in most of the 12 regions in US with improving job creation, which could reinforce the central bank’s decision to pullback its monetary stimulus this month. Investors were cheered by Aug double-digit auto sales, its best in almost six years, from GM, Toyota, Ford and Chrysler. But the market remained on edge as a US Senate panel authorised a limited use of force against Syria. Oil prices slipped 1.4% to US$107.02/barrel, while gold dropped 1.5% to back under US$1,400/oz and yields on the 10-year Treasury moved up to 2.89%. Investors will be chewing on BoJ policy statement, BoE bank rate and two US labour releases today with the key nonfarm payrolls report due Fri. The STI is still trapped in a downtrend, having failed to break above the important resistance at 3,065 with downside support at 2,990. Stocks to watch for: *Yangzijiang: Four shipbuilding options worth US$110.4m, comprising two 1,100-TEU containerships and two 82,000 dwt bulk carriers have been converted into effective orders with scheduled deliveries in 2015. Year-to-date, the group has secured 35 shipbuilding contracts amounting to US$1.22b with another 51 options valued at US$2.87b, of which 22 are containerships worth US$1.79b and 29 bulk carriers worth US$1.08b. *Global Logistic Properties: Commenced redevelopment of GLP Zama into a 130,000 sqm multi-tenant logistics facility in Greater Tokyo. Project is expected to be completed in Jul 2015 at an estimated development cost of ¥20.9m (US$210m). GLP Zama is the 6th project under GLP Japan Development Venture, a 50/50 JV between GLP and Canada Pension Plan Investment Board. To-date, the venture has total investment commitments of ¥79.6b (US$802m). *Hiap Hoe: Makes second overseas acquisition with purchase of a mixed use commercial property in Melbourne Australia for A$43.8m. The freehold property has approved planning permits for the development of a 46-storey tower with a retail ground level, 3,187 sqm of office suites, 627 apartments and 740 car park lots. The acquisition will be funded by a combination of internal resources and debt. *Synear: Received shareholder approval to delist from SGX despite independent advisor Ernst & Young finding the exit offer `not fair’ because of the sharp discount to book value but `reasonable’ when taking into account the poor liquidity of the stock. The exit offer of $0.186 per share will last for another two weeks.