SG Market (31 Mar 17)

The market could creep higher, taking cue from Wall Street’s overnight bounce on a US 4Q GDP growth upgrade and oil prices rising above US$50/bbl.

Regional bourses opened mixed, with Tokyo (+0.5%) firmer, and Seoul (-0.04%) and Sydney (-0.1%) weaker. Technically, immediate resistance for STI is still pegged at 3,200 with downside support at 3,140.

Stocks to watch:
*SGX: Reportedly held exploratory talks with overseas exchanges, including Nasdaq and CME Group on potential collaborations, a partial stake sale, or even a full merger. This comes at a time when cross-border deals between operators are drawing intense scrutiny from regulators. Separately, SGX has lodged complaints with Chinese authorities against China Fibretech CEO Wu Xin-hua for making suspicious and inflated cash transfers to customer claims without obtaining board approval.

*GLP: Provided an update on its strategic review that it remains in discussions with several parties that have submitted M&A proposals and started due diligence. However, it emphasized that all the terms of the proposals (including price) received are non-binding and there is no certainty that any definite transaction will materialise. The stock currently trades at 1.1x P/B.

*CWG: Acquired 60% stake in Suzhou Xinglun Tourism Co for Rmb197.2m, which owns the iconic Suzhou Ferris Wheel Theme Park and two plots of land with total gfa of 75,797 sqm, on which it plans to build an integrated residential-cum-retail development. The residential plot (60,797 sqm) will be developed into 202 serviced apartments and 96 luxury condos in 2019, while the retail portion (15,000 sqm) will be completed by 2021.

*Sunpower: Secured two contracts worth Rmb90.3m to supply six heat exchangers to Hengli Petrochemical (Dalian) Refining and Chemical (Rmb58m), deliverable in FY18 and a fluidized bed reactor to Jiangxi LDK Silicon Technology (Rmb32.3m), deliverable in FY17.

*Geo Energy: Negotiated with Sunrise Wealth Success to reduce the US$18m consideration for the proposed acquisition of 100% stake in Parisma Jaya Abadi coal mine (PJA) in Indonesia. Separately, two other proposed acquisitions, Blessing Capital and Cahaya Lembusuana, have lapsed due to expiry of long-stop date.

*Ezra: Received notices of demand for an aggregate US$35.3m from Seabird Penguin Offshore for its bareboat charters of vessels Lewek Toucan and Lewek Pelican. The charter contracts were terminated earlier this month following various events of defaults and breaches of agreements. Ezra has 10 business days to remit an initial sum of US$7.4m.

*ST Engineering: President-designate of ST Kinetics Lee Shiang Long will assume role as president of the subsidiary wef 1 Apr.

*Frasers Centrepoint: Proposing to issue a second tranche of $52m 4.15% fixed rate notes due 2027 under its $5b multicurrency debt issuance programme. The notes will be issued on 6 Apr and will consolidate with the $398m first tranche notes issued on 23 Feb under the same terms.

*Keppel REIT: Issuing $75m 3.275% notes due 2024 under its $1b multicurrency debt programme. The notes are expected to be issued on 6 Apr '17.