SG Market (22 Oct 13)

SG Market: US stocks ended flat on Monday as investors took a breather following last week’s heavy gains. Traders were also reluctant to place big bets ahead of the release of Sep employment data on Tue, which had been delayed from 4 Oct due to the partial government shutdown. Attention turned to the 3Q results reports, which saw some hits and misses but earnings has so far topped expectationses with analysts now forecasting profits for S&P companies to grow 4.5% in 3Q, up from earlier estimates of 1.7%. On the economic front, existing home sales fell 1.9% in Sep due to rising prices and mortgage rates. Data from the Labour Department is expected to show a 180,000 gain in nonfarm payrolls last month. With no major hindrances on the local market, we expect the STI to trade within its 50 and 200-day moving averages bounded by support at 3,150 and resistance at 3,238. Stocks to watch for: *Hutchison Port: 3Q13 results were in line with net profit of HK$539.2m (-8.4% y/y, +28.2% q/q) on revenue of HK$3.36b (+1% y/y, +10.9% q/q). Container throughput at HK ports fell 11.6% in light of weaker transshipment, intra-Asia and US/EU cargoes, while volume at its Yantian terminals in Shenzhen slid 3.5%. Revenue per TEU was higher due to favourable container mix, fewer concessions granted to some liners and lower empty box ratio. While US-bound trade appears to be improving, cargo traffic to Europe remains soft. *Frasers Centrepoint Trust: 4QFY13 DPU improved 10% y/y to 2.98¢ with distributable income of $21.7m (+2.7%), bringing FY13 DPU to 10.93¢ (+9.2%). Gross revenue rose 3% to $40.2m on higher contributions from Causeway Point and Northpoint aided by better rental rates but NPI dipped 5% on higher property expenses (+25.1%), mainly due to increased taxes and maintenance costs. Overall portfolio occupancy remained stable at 98.4% with weighted average lease to expiry of 1.56 years. NAV per unit rose 16% to $1.77, while gearing slid 2.5 ppts to 27.6% with average cost of debt at 2.73% and weighted average debt to maturity of 2.85 years. *SGX: Ties up with Shanghai Futures Exchange to develop commodity derivatives for both markets. The two will collaborate on derivatives for energy, metals, chemicals and commodity indexes. Shanghai Futures Exchange is China's biggest futures market and trades metals, steel products, oil products and natural rubber, while SGX is the dominant exchange for clearing of iron ore swaps. *Midas: Subsidiary Jilin Midas Aluminium has won Rmb167.5m worth of contracts from CNR Changchun and CNR Tangshan to supply extrusion profiles and fabricated parts for the manufacture of high speed trains. The contracts are expected to contribute positively to FY13-14 financial performance. *Civmec: Secured $210m worth of new contracts since end-July to take order book to $330m. The contracts include structural mechanical piping and civil works for Rio Tinto iron ore wet processing plant and below water table project, construction of gold processing plant for La Mancha Resources and extra offsite work on existing LNG projects. *TTJ: Clinched new contracts totaling $41m to supply, fabricate and install civil defence shelter doors for two Downtown Line 2 stations (Sixth Avenue, King Albert), as well as works on Tan Kah Kee station. Also secured structural steelworks contracts for the Tanjong Pagar Centre project currently under development by GuocoLand and Mediapolis @ one-north. This takes its order book to $151m. *OKH Global: Awarded $32.8m contract from Nam Leong Co, to design and build a four-storey warehouse with ramp up facilities at No. 7 Pioneer Sector Lane. *United Envirotech: Investing Rmb105m in a municipal wastewater treatment project in Shandong’s Qixia City. Under the concession agreement, UEL will acquire an existing 20,000 m3/day treatment plant and expand its capacity to 40,000 m3/day. Project will be completed by 3Q14, and funded by it last convertible bond issue and share placement. *China Minzhong: Controlling shareholder Indofood Sukses Makmur plans to keep the vegetable producer listed on SGX, despite public float shrinking to 4.4%. At close of its offer, Indofood has acquired 583.2m shares or 89% stake and will take steps to restore the minimum 10% public float for listing status. *KrisEnergy: Begins drilling the Ca Ngu-1 exploration well in Block 120 offshore Vietnam. The group holds a 25% interest in Block 120, which covers an area of 8,574 sq km. *Frencken Group: Terminated a RM41.6m deal involving the sale and leaseback of four land parcels in Penang totaling 46,842 sqm with three industrial buildings and ancilliary office space owing to certain conditions imposed by the Penang Development Corp that are not acceptable to the purchaser, AmanahRaya Reit. *TPV Technology: Warns of an expected loss for 3Q13 compared to a profit for the same period last year, citing continued demand weakness in its key markets and depreciation of currencies against the USD.