Market Wrap by Broker – 28 June 13

Baltic Dry: 1151 +2.31% Gold: 1202.60 -2.06% Palm Crude: 2355 -1.01%
VIX: 16.86 -2.03% WTI Crude: 96.80 -0.26% USD/SGD: 1.2676 -0.23%
Trading Halt: Sound Global(SGL)

*SingTel(ST), Yoma Strategic(YOM) failed to get Myanmar telecom licenses; Norway’s Telenor & Qatar Telecom clinched the only 2 licenses in the country while France Telecom (partnered with Marubeni Corp) has been named as a back-up candidate. YOMA to resume trading today after a 1-day halt while ST rose 3.3% yday before results announced.

*SATS Ltd(SATS): subsidiary SIPL in proposed disposal of 40% equity interest in Adel Abuljadayel Flight Catering Co. for cash consideration of ~US$18m.
*Wilmar(WIL) proposes to dispose its 15% equity interest in Fortune Gas Invest.

*Chemoil Energy(CHEME) unit signs total of $800m syndicated banking facilities; co. signed its inaugural $300m 364-day committed revolving credit facility & $500m 364-day uncommitted secured receivables borrowing base facility.

*CosmoSteel Hldgs(CSMS) in MOU on potential business relationship in Myanmar.

*China Fishery Group (CFG) to start arbitration against Veramar in Peru over the latter’s failure to transfer a call option that will let CFG raise its stake in Copeinca ASA.

*Eu Yan Sang(EYSAN) assures no client data was compromised after their website was hacked yday; CEO says no financial impact; business as usual.

*Freight Links Express(FLE) FY NP S$38.36m +19.1%YoY on REV S$171.06m +14.5%YoY mainly due to commencement of new ISO tank operation biz from May 1 last yr; 1st & final div of 0.5cps declared vs 0.45cps a yr ago.


Market Wrap by Decoder – 28 June 13

• CN/HK – Two angles to one expected holiday bonus. Monday marks the anniversary of the establishment of the HK special administrative region, Beijing is expected to give the long awaited nod to allow qualified mainland investors to invest in HK stocks. Political or Financial? HK stocks will no doubt get a lift from the policy change and several restricted brokers are set to benefit. Politically, the announcement is set to coincide with protests by thousands, demonstration against the administration of HK Chief Executive CY Leung.

• Overnight equities raced off at the start of the opening bell, thanks to a BTE personal income report which shows an increase of 0.5% in May Vs 0.2% est. Dovish commentaries from the various President also helped in creating the +ve sentiment. NY Fed Reserve Bank President played down the possibility that the rate hikes are in the card anytime soon. Atlanta Fed President said that the markets have mistaken Bernanke’s framework for tapering of the asset purchases. Stocks gotten another boost when pending home sales came in +6.7% vs 1.5% expected. Asian Markets mostly opened higher, moving in line with the US equities as hopes

Market Wrap by Decoder – 26 June 13

• CN/HK – PBoC made a statement on its website, hoping to save market confidence. This will help to stabilize market expectations and reduce the wild swings in the financial markets. Interbank interest rates will decline from mid July with smoother liquidity management from PBoC. The statement mentioned that the central bank has provided liquidity for the past few days to those banks that meet macro prudential requirements and noted that money market interest rates have declined significantly from the recent highs. 4 key messages from them:
1. System liquidity is ample, excess reserve at RMB 1.5tn is well above the minimum level required @ 600-700bn.
2. PBoC had already injected liquidity to “qualified financial institutions.
3. PBoC said that it will prevent the extreme short term volatilities and stabilize market expectations, to ensure the stability of financial markets and enable economic restructuring.
4. SMEs are still of strategic focus; commercial banks are required to strengthen liquidity and maturity management, and enhance credit support of SMEs and rural areas.

• Markets traded in the +ve territory for the entire session, extending gains in the last 2 hrs after +ve consumer confidence (hit 5 yrs high of 81.4 Vs 75.1 cons)/home sales data (+476k Vs 400k). Plenty of macro data were published yesterday and a handful of them (Mfg Index/Consumer Confidence/New home sales/Home price Index) were indicating a steady recovery in the US economy. Dovish commentary by BoE Meryn King – “anyone who thinks the Fed or any other major central bank will start raising rates soon was jumping the gun” and PBoC’s stance on sufficient liquidity in the markets helped lifted the indices higher. However, yield on the 10 yrs treasury continued to tick higher to 2.6% in overnight trading.

Market Wrap by Decoder – 25 June 13

• CN/HK – Moody’s changes the outlook for HK banking system to negative from stable, raising concerns over the persistent –ve real interest rates (since 2009) and potential prop bubbles and banks’ growing exposure to mainland China. Financials are likely to take a hit in trading today.
• Overnight SHIBOR fell 200 bps to 6.489% yesterday, but the banks are still short of cash because the rates remained high enough to trigger earlier redemption of some currency funds. Corporate failed to borrow money with their receivable notes as discount rates jumped to unaffordable levels.

• Markets bounced off lows after the commentaries from the Fed members managed to calm some nerves. Fed President Kocherlakota, argued that the Fed set clearer guideposts for the outlook for record stimulus and commit to press on with monthly bond purchases at least until unemployment falls below 7% while Fed’s Fisher says the Fed is not exiting accommodative policy yet and he is not comfortable with US rates. Over the weekend, NY Fed President William Dudley also reiterated that the Central Bank should continue with its easy money policies, especially so with the recent market conditions. However, the markets were still spooked by all the –ve news going around such as European Stoxx 600 erased all gains and was down on the year/Moody’s downgrade of HK banking/Spanish bond yields > 5% for the first time in 3 months/Bund yields @ 14 months high).

Market Wrap by Decoder – 24 June 13

• CN – First time in 9 months, PBOC slipped out some loosening signals to the markets after concerns of a liquidity squeeze at home and abroad sent Chinese equities falling and money market rates soaring last week. PBOC has commented that they will fine tune the policies appropriately and will stick to a prudent stance now. Market doesn’t expect a big shift in liquidity management by the PBOC but more flexibility in terms of implantation of the policies.

• Stocks ended the trading sessions last Friday slightly higher, after experiencing wild swings in the volatile sessions. Bonds fell for the 5th session, pushing 10 yrs yield to 2.54% – marks the largest 1 week selloff in a decade as investors anticipated the increased in interest rate after the tapering of QE3. Over in the Eurozone, Greece stocks were punished severely, -6% after the democratic left withdrew from the coalition government in response to the closing down of the public broadcaster ERT which costs 2,600 jobs. Negotiation among the 27 members bloc’s finance minister stalled over the weekend after they tried to reach agreement on assigning losses of failing banks as part of the proposed rules on bank resolution and recovery.

Property Related Snippets – 21 June 13

*CapitaLand(CAPL) Unit-Athens Residential Development won the 99-year leasehold plot in Coronation Road received a top bid of $366m ($908.17 psf ppr);Buyback S$229m of 2.875% CBs due 2016 and S$60m of 2018 Bond after issuance of S$650m 7yrs CBs.

*CapitaMall Trust (CT) To focus on opening Westgate Mall by end-2013; 21 malls developing to add to future earnings with 75% of its malls operational.
*GuocoLand Ltd (GOUL) put up sale of service apartments in Shanghai for RMB588.2m (S$122.3m).

*SingHaiyi Group (SINX) Enters JV with Haiyi Properties PL to submit a tender to invest in the development of the land parcel located at Coronation Road

*Q2 property investment sales (> $10m) slip 10% from Q1’s $5.6b; Deals originating from private sector accounted for $2.6b or 59% of total Q2 investment sales while public sector makes up the remaining 41%.

*CCM Group (CCM) Proposed placement of 44m new ordinary shrs (S$0.092 each).
*Aspial(ASP) confirms unit World Class Land gets tender for Faber Walk site.
*Challenger Technologies (CHLG) secures new lease located in West Mall.

Change In Shareholders’ Interests/ Fillings:
*Singland (SL) UIC up stake again to 80.146%, purchasing of 77k shares *IHH (IHH) EPF increased stake to 6.76% with purchase of 571.4k shares

Market Wrap by Decoder – 21 June 13

• ETF flows saw huge volumes went through as well, seeing outflows in all the markets.
• Stocks were sold down as global risk reduction takes on the centre stage. Investors are seen fleeing from equities to the safer bonds, causing US treasury yields to surge for the 2nd day. Yesterday marks the largest losses in the US markets since Nov 2011 and bond yields are at its highest level in 2 years. Sell down were broad base, led by consumer related names/utilities/energy, which saw the worst price action. T/O picked up alittle, +24% Vs 2 weeks average while VIX added 23% as fear hits the global markets. Macro data seems irrelevant in yesterday’s trading session but jobless claims probably did add on to the woes (came in +354K Vs 340K cons). Asia markets moved in tandem, falling close to 2% before finding bottom. Having fallen 3-4% in 2 days, we should expected the market to trade higher from current levels to recover some grounds as pessimism fades away.