consideration – Positive for SREITs & emerging
markets exposure as US 10-yr yield and Dollar dips
BREAKING NEWS – Former Treasury Secretary Lawrence
Summers withdrew his name from consideration to be
chairman of the FED. Summers is considered the ‘most
hawkish’ compared to the other 2, Janet Yellen and
Donald Kohn. Financial markets are currently reacting. The
USD is pullback with the Dollar Index dipped 0.315 of a
point to 81.13. US 10-year yield is also pulling back to
2.8846% (-0.025).
News of Summers’ withdrawal eases some of the current
concerns for equities with regards to how quickly QE will
be tapered and short rates will rise down the road. Asia
markets are currently firmly higher as are US futures. Yield
plays such as S-REITs should rebound (refer to Traders
Spectrum titled “Bond Yield going ↓ → SREITs going ↑
” for our picks. Likewise emerging market stocks (e.g.
Indo names) should also rebound as their currencies
rebound against the USD.
Overseas Education announced that the SLA has on 13
September 2013 levied an additional land premium of
S$9.1m on the new campus due to intensified land use.
This is on top of a S$28m land premium payable for the
site announced in June 2013. This additional levy would
bring total development costs of the new campus to
c.S$270m, which is within our estimated budget of
S$280m. Hence, no change to forecast and S$1.01 TP for
OEL.
Datapulse Technology is proposing a capital reduction
exercise. The CD and DVD services firm also announced
that its non-executive chairman and director, Ng Khim
Guan, had stepped down from both posts with effect
from last Thursday. The proposed capital reduction will
see the firm's shareholders receiving a cash distribution of
3.5 cents per share. According to Datapulse, there will be
no share cancellation or change in the number of shares
held by shareholders. Each shareholder will have the same
number of shares before and immediately after the capital
reduction. The board is of the view that the capital of the
US Indices Last Close Pts Chg % Chg
Dow Jones �� 15,376.1 75.4 0.5
S&P �� 1,688.0 4.6 0.3
NASDAQ �� 3,722.2 6.2 0.2
Regional Indices
ST Index �� 3,120.3 (0.
(0.0)
ST Small Cap �� 550.7 (2.0) (0.4)
Hang Seng �� 22,915.3 (38.4) (0.2)
HSCEI �� 10,538.9 (98.6) (0.9)
HSCCI �� 4,418.3 (0.0) (0.0)
KLCI �� 1,770.8 (1.6) (0.1)
SET �� 1,401.1 3.2 0.2
JCI �� 4,375.5 18.9 0.4
PCOMP �� 6,133.2 (62.4) (1.0)
KOSPI �� 1,994.3 (9.7) (0.5)
TWSE �� 8,142.5 (25.7) (0.3)
Nikkei �� 14,404.7 17.4 0.1
STI
Total Market cap (US$bn) 577
Total Daily Vol (m shrs) 6,225
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
13 Sep
Target Price
($)
ST Engineering Buy 4.110 4.80
ComfortDelgro Buy 1.885 2.19
OCBC Bank Buy 10.090 12.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
13 Sep
Target Price
($)
Ezion Holdings Buy 2.310 3.20
Goodpack Buy 1.650 2.00
Nam Cheong Buy 0.275 0.36
CSE Global Buy 0.900 1.07
Venture Corporation Buy 7.480 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
company is in excess of its immediate requirements and
the proposed capital reduction will allow the group to
achieve a more efficient capital structure.
CSC Holdings has grown the total value of its foundation
contracts in Singapore and the region to $200m since its
latest financial year began in April, after clinching two
more deals. It has been awarded two foundation
contracts: one for the future Terminal 4 at Changi
Airport, and the other for the redevelopment of two
buildings along Robinson Road.
Mermaid Maritime has been awarded an initial of two
years contract, with a one year option, to provide
offshore Inspection, Repair and Maintenance (IRM)
services to a major Indonesian based upstream oil and gas
operator. The estimated contract value for the initial term
is USD 55m.
Federal International is acquiring a land drilling rig for
US$10.4m, to be satisfied by cash of US$7.7m and the
balance of US$2.7m through the issue of new shares at
an issue price of S$0.10 per share.
Singaporean Ho Kwok Wai, a consultant, has entered into
a deal to acquire 90.4m shares, or a stake of 73.86%, in
mainboard-listed Singapore Windsor Holdings at 18 cents
a share, triggering a general offer for the remaining
interest at the same price. The consideration values
Singapore Windsor at $22m.
Retail sales in July fell a sharper-than-expected 7.8%
compared with a year earlier, as sales of motor vehicles
were hit by the implementation of the total debt servicing
ratio (TDSR) framework at the end of June. The data was
below market expectation of a decline of 1.5% and
June’s 4% drop. Stripping out vehicle sales - which
plunged 42.7% y-o-y and 19.7% m-o-m - retail sales for
July rose 2.5%. On a month-on-month basis, retail sales
fell 5.3% in July, and were down 2.6% after excluding
vehicle sales. Aside from motor vehicles, retail categories
which posted lower year-on-year sales in July included
telecommunications apparatus and computers (-7%),
recreational goods (-3%) and wearing apparel and
footwear (-2.4%). But petrol service station sales jumped
8.4% from a year ago, while receipts for food and
beverages increased 5.7% and those of optical goods and
books rose 4.9%.
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