Thursday, August 20, 2015

SG Market (20 Aug 15)

Singapore shares may take another beating with the confluence of worrisome factors that include China's growth slowdown, weakening currencies in the region, pummelling commodity prices and timing uncertainty of a US rate increase.

Investors are likely to be staying out until the dust settles.

Overnight in Wall Street, the S&P 500 closed 0.83% lower, dragged by the energy sector after oil prices plunged to new lows following an increase in crude supplies.

Regional bourses are all trading lower this morning in Tokyo (-0.2%), Seoul (-0.4%) and Sydney (-1.1%).

From a chart perspective, the bearish downtrend has yet to see any respite, although technical indicators are currently at oversold region. Immediate support at 2,950 (Feb ’14 low) and overhead resistance at 3,150.

Stocks to watch:
*Religare Health Trust (RHT): Acquired a 5.1 acres freehold land for $15.7m, adjacent to its Mohali Clinical Establishment. The new area provides headroom for expansion of up to 500 additional beds, potentially bringing total beds to 844. The acquisition is debt-funded and will lift its gearing to 19.4%.

*Thakral Corp: Established an investment programme with Aberdeen Asset Management Asia in real estate projects in Australia, with a focus in Sydney, Melbourne, and Brisbane. The six-year programme will be managed by Thakral, while Aberdeen will provide financial backing via equity or mezzanine debt.

*Sunningdale Tech: To acquire mould and prototype manufacturer Skan Tooling for €750,000 (19.5% discount to NAV).

*mm2 Asia: Binding term sheet with Mega Cinemas Management to acquire three mega cineplexes in Northern Malaysia for RM22m. The proposed acquisition is in line with group's intention to move downstream.

*Soo Kee: Trading debut for jeweller Soo Kee Group. The IPO of 112.5m new shares (103.5m placement and 9m public offer) at $0.30 each was 1.1x subscribed.

*Willas-Arrary Electronics: Profit warning for 1H15 due to share of loss from associates attributed to significant debtor provisions for doubtful debts and stock provisions for slow-moving stocks.

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