Singapore shares are primed for a volatile week despite the strong finish on Wall Street last Fri as the Greek bailout deal hangs in the balance with Greece facing a tough ultimatum set by its eurozone partners to agree to a tough take-it-or-leave-it rescue plan by Wed.
Investrs will also watch to see if China’s stock markets can stabilize after a barrage of government support measures sparked a much-needed rebound late last week, and sentiment will be tested by trade data today and 2Q GDP report on Wed.
In the week ahead, the local results season will be kick off on Tue, starting with the REITs and followed by the three banks in the last week of July.
Regional bourses are mostly up this morning in Tokyo (+0.7%), Seoul (+0.3%) and Sydney (-0.04%).
From a chart perspective, the STI is still showing no signs of reversing from its downward trend, with underlying support at 3,200 (Dec ’14 low) and MACD, Stochastics indicators exhibiting bearish patterns. Overhead resistance is capped at the 3,360 triple-top.
*CapitaLand: Wholly-owned Ascott Serviced Residence (Global) entered into a 50:50 JV with Qatar Investment Authority. The JVCo will have an aggregate equity of up to US$600m ($809m) and will focus on investments in property development, redevelopment and turnkey opportunities. This is part of the group's intention to manage up to $10b in assets under six new funds by 2020.
*Loyz Energy: Profit warning for 4QFY15 and FY15 due to a one-time, non-cash impairment of non-core investments in India and US, which the group intends to dispose of. Notwithstanding, the group expects to be able to meet its target EBITDAX of US$12m.
*DeClout: Proposed to acquire 30% vendor stake in vCargo Cloud, an e-trade services and cargo cloud solutions provider for the trade, logistics and supply chain industry. The consideration of $6.9m will be paid via an issue of up to 28.8m shares ($0.24 apiece) across four tranches, subject to new freight forwarder sign-ups to its new high-end comprehensive cloud solution and the establishment of a platform in at least two continents.
*Huationg Global: Formed 33.3/66.7 JV with Golden Empire Civil Engineering to tender for larger civil engineering works.
*YuuZoo: Taken legal action against Infocomm Asia Holdings for an outstanding debt of $6.5m, including interest, which was due in Jan ’15.
*ISEC: To cease business operations in loss-making ISEC Singapore, its eye clinic operations in Mount Elizabeth Novena Specialist Centre. The closure is expected to have a material impact on ISEC's FY15 EPS but it expects to reap cost savings of ~$1.3m in FY15 onwards.
*Metech International: Proposed 1-for-2 renounceable non-underwritten rights cum warrants issue at 0.3¢ apiece, with one free warrant immediately detachable upon Ex-date, with an exercise price of 0.4¢. Net proceed of up to $9.7m is intended for working capital (80%) and corporate activities (20%).
*Chiwayland: Proposed to dispose a 20% stake in its property developing business, Xuzhou Chiway Construction, for Rmb40m ($8.7m).
*China Environmental Resources Group: To terminate placement of 188.6m new shares (20% share capital) at HK$0.63/share, due to the recent instabilities of the financial market.
*China New Town: Entered 15-year Public-Private-Partnership cooperative investment agreement with Danyang Investment Group (DI) and Danyang Municipal Development, to engage in the development and operation of the Danyang municipal flood-discharge channel regulation and Suzhou South canal regulation project. China New Town will contribute Rmb200m for a 36.6% stake and be entitled to a 13% ROI during the two-year development phase. After which, DI has undertaken to fully purchase China New Town’s 36.6% stake at par. Subsequent operations and maintenance period shall last the remaining 13 years.
*IEV: Received settlement amount of US$2.3m from Allison Marine Contractors II LLC from loss and damage arising from a breach of contract. The amount is expected to be EPS and NTA accretive for FY15.
*LMIR Trust: Completed the acquisition of Palembang Icon, a five-level retail mall cum sports centre with a net lettable area of 35,797 sqm. The property located in Palembang, Indonesia, was financed by a combination of internal cash reserves and partial proceeds raised from a medium term note programme.
*Mapletree Logistics Trust (MLT): Completed the divestment of a Joo Seng Road property for $13.5m. Following which, MLT’s portfolio stands at 117 properties comprising 52 properties in Singapore, 22 in Japan, 8 in Hong Kong, 11 in South Korea, 14 in Malaysia, 9 in China and 1 in Vietnam, with total book value of $4.64b.
*Hoe Leong: Looking to raise up to $5m through a share placement.
*Tiger Airways: Operations recorded a 10.2% y/y fall in traffic in Jun, while capacity contracted 8.9%. Consequently, passenger load factor slipped 1.3ppt to 85%. Tigerair flew a total of 439k passengers in Jun, down 9.7% m/m.
*Yoma: To collaborate with Dulwich College International schools to handover the academic and operational management of Pun Hlaing International School, cementing Pun Hlaing Golf Estate’s status as a premier residential community in Yangon.
*Cosco Corp: To further postpone delivery of a rig for KS Energy, originally scheduled for 1Q14, till 30 Apr 2016.
*Vallianz: Clinched time charter valued at up to US$300m to supply two self-elevating platforms to its existing Middle Eastern national oil company. Both vessels are expected to be deployed from 3Q15 for a period of five years, with an option for a two-year extension.
*Spackman Entertainment: Will commence filming for "Musudan" and "Chasing" in Jul '15, with both expected to be released in Korean theatres by end-2015.