Sentiment for Singapore stocks is likely to remain fragile following the slump on Wall Street as a mudled nonfarm payrolls report gave little clarity on Fed’s interest rate timing. Investors will also be on tenterhooks as the volatile China market re-opens after a two-day trading halt.
Regional bourses are trading lower this morning in Tokyo (-1.4%), Seoul (-0.6%) and Sydney (-1.3%).
From a chart perspective, the STI is tucked firmly in a mid-term downtrend with the next support at 2,750 and topside resistance at 2,950.
Stocks to watch:
*Property: According to Knight Frank's Global House Price Index, S’pore private home price registered the 2nd-largest drop in Asia in 2Q, behind only China, with non-landed residential prices down 3.2% y/y and 0.8% q/q, as prospective buyers remained cautious against the backdrop of existing cooling measures and in anticipation of further price correction. The firm expects overall private non-landed home price to decline by 3-4% on a yearly basis by 4Q15.
*SGX: Total securities turnover for Aug came in at $28.1b (+34% y/y; +16% m/m), with daily average traded value of $1.5b (+49% y/y; +35% m/m). Bond listing raised $7.4b with 23 new bonds listed, while there were two new Catalist listings which raised $40m. Derivatives volume was at 17m contracts (+82 y/y; -21% m/m) while commodities derivatives volume came in at 535,438 contracts (+285% y/y; -22% m/m).
*Keppel REIT: To acquire three remaining prime retail street-fronting units at 50%-owned 8 Exhibition Street in Melbourne, Australia, for A$8.6m ($8.6m). The retail units are currently 100% leased to two popular and established F&B outlets for 10 years with fixed annual rental escalations, with options for another 30 years. The DPU accretive acquisition is expected to be completed in 4Q15.
*Ezra: Announced that EMAS AMC has finalised a contract with BHP Billiton for an offshore fabrication and installation project in Trinidad and Tobago. The project is expected to be executed in mid-2016, utilising the its vessel, the Lewek Express. Recently, it invested EMAS AMC as a business into a JV with Chiyoda Corp.
*YuuZoo: Secured access to $30m in capital funds from GEM Global Yield Fund over three years. The maximum drawdown and issuance of shares will not exceed 19.9% of its shares on issue. It has also issued 55m warrants to GEM Global with a one warrant for one new share right at an initial exercise price of $0.70 (currently trades at $0.134).
*Yoma: Terminating a JV with Volcafe. The JV was intended to spearhead the company’s expansion into the planting and production of Robusta coffee beans in its Maw Tin Estate, Myanmar. Notwithstanding this, Yoma intends to continue with the project.
*Yongnam: Agreed to buy 3 pieces of adjacent freehold industrial land at Ulu Choh in Johor from Vee Sen Property for RM38.4m ($10.3m). Vee Sen is 45% owned by YNH's founder Tan Tin Nam.
*Ramba: MOU with a strategic investor to farm-out a 25% working interest in the Lemang production sharing contract, which 80.4%-owned subsidiary PT Hexindo Gemilang Jaya holds. The aggregate consideration for the proposed deal is up to US$128.3m, consisting upfront cash of US$18.8m and remaining in tranches upon achieving milestones. An agreement is expected to be entered on or before 25 Sep.
*Asian Micro: Recycling and precision cleaning services provider proposed to diversify into property, in light of pricing pressure and rising operational costs.
*A-Sonic Aerospace: Divesting all of its 710,377 shares or close to 50% in Worldwide GSA to WFC Investment for $6.3m, deriving an estimated gain of $3.2m, as part of its plan to offload non-core business.
*MMP Resources: Received a Writ of Summons and Statement of Claim from lawyers of Quintestellar Re Capital, claiming that it is entitled to the repayment of $4,7m under a loan. The company intends to defend the legal action.
*Hoe Leong: Has been sued by Chimbusco Pan Nation over a marine fuel oil sales contract for US$335,858.
*Transcorp: Obtained approval in-principle to transfer to the Catalist Board from the Mainboard.
*IPCO: Intends to transfer its listing from the main board of the SGX to the Catalist Board.
*NauticAWT: Expects to report a net loss for 1H15 due to IPO fees as well as losses suffered by recently acquired (Nov ‘14) group of subsidiaries.