SGX
Phillip Capital Market Reports:
Phillip Daily Morning Note :
US Market (By Phillip Global Markets Night Desk)
1 November 2023
Investors Like November
The U.S. stock market tends to rise, despite the market's performance over the past three months. This long-term upward trajectory has its foundation in the country's democratic political system and its market-based, capitalist economic system. In theory, the stock market efficiently allocates the nation's capital to generate solid investment returns. Theory typically turns into reality in November, which since 1980 has been the best month for equity performance, with an average 1.9% gain, ahead of April (+1.70%), December (+1.2%), July (1.4%), and January (+1.0%). November's batting average is high as well: stocks rise during the month 72% of the time. The best Novembers have been 1980 (+10.2%), 2001 (+7.5%), 1996 (+7.3%), 1985 (+6.5%), and 1998 (+5.9%). There have been some clunkers: 2000 (-8%), 2008 (-7.5%), and 1987 (-5.9%). Last year, the S&P 500 rose 5.1% for the month. November usually starts at a fast pace, as some companies are still reporting 3Q earnings and nonfarm payrolls are reported. This year, the Fed meets this week and likely will take a pause from its rate-hike campaign. If the central bank signals that this is the last hike in the series, the rally that faded in late July may come back to life.
Market Wrap
Wall Street traders gearing up for the Federal Reserve are also digesting the Treasury’s decision to slow pace of increase of its quarterly sales of long-term debt — with bonds and stocks pushing higher.
Ten-year government bond rates dropped eight basis points to 4.85%. S&P 500 futures were little changed, rebounding from session lows.
Today's Big News
Israel Latest: First Foreigners Exit Gaza Via Egyptian Border
Singapore Bars DBS Acquisitions for Six Months After Outages
Toyota Raises Profit Forecast 50% on Weak Yen, Record Sales (1)
Estée Lauder Plunges on Lowered Outlook, Israel Warning (1)
Ex-Google CEO Schmidt Bets AI Will Shake Up Scientific Research
Trump’s Three Children Set to Testify in His NY Fraud Trial
OCBC
DBS
Market News
Eurozone inflation falls to two-year low of 2.9% in Oct (vs consensus 3.1%); 3Q23 GDP growth declines by 0.1%
Bank of Japan makes yield curve control policy more flexible and keeps rates unchanged
AMD’s 3Q23 revenue and profit beat expectations but gives weaker-than-expected 4Q23 guidance
Regional Market Focus
Opportunities beyond uncertainties
Prefer Singapore over Hong Kong, Thailand over Indonesia and Philippines
Potential impact of the Middle East conflict on sector and stock performance
Go for earnings visibility, resilience, and good recovery prospects
Which counters do we prefer?
Click here to read our views
Thai Beverage (THBEV SP)
Powering on with improving tourist arrivals and domestic consumption
Latest visa waiver for India and Taiwan travellers, while less significant compared to China, is another positive step to boost tourism arrivals, and should be a positive for THBEV too
Recent datapoints (e.g., upward revisions to Private Consumption forecast, Consumer Confidence Index) also suggest domestic consumption to hold up well
What datapoints support our view on THBEV?
Click here to read our views
CDL Hospitality Trusts (CDREIT SP)
3Q23 Operational Update – Record high RevPARs across the portfolio
3Q23 NPI rose 23% y-o-y to S$39m; 9M23 NPI up 23% y-o-y to S$101.9m, in line with our full year estimates
SG hotel RevPAR rose 20% y-o-y led by strong ADR performance; 7 portfolio hotels reached record 3Q RevPAR since listing (4 within Singapore)
Next tranche of renewal in 2H24 to buffer against impact of higher funding cost for rest of the year
What factors do we see supporting room demand?
Click here to read our views
BYD Electronic (285 HK)
Strong auto growth to persist in 2024
3Q23 revenue surged 131% y-o-y, driven by strong Apple orders and EV component business growth
Earnings skyrocketed by 153% y-o-y, in line with the guidance, fuelled by a higher contribution from high-margin segments
Raise FY24/25F earnings forecast by 20%/15% to factor in sustained gross margin expansion in the smartphone business
What is the potential re-rating catalyst?
Click here to read our views
DBS Group Research | Equity Picks
Singapore Equity Picks: Read more
Hong Kong Equity Picks: Read more
UOB
UOBKH: Retail Market Monitor: Wednesday, November 01, 2023
UOBKH: Regional Morning Meeting Notes: Wednesday, November 01, 2023 [GC Property, 914 HK, 1876 HK, 1919 HK, 002747 CH, 600887 CH, 2328 HK, 2359 HK, BSDE IJ, ISAT IJ, MAL Alpha Picks, MAL Banking, BURSA MK, SG Alpha Picks, FCT SP, TWC SP, TH Propert...
KGI
Top Stories, 1 Nov 2023
1. Asia markets gain ahead of manufacturing data, Fed decision
2. CME Group's E-mini S&P 500 Futures provide one of the most efficient, liquid and cost-effective ways to gain market exposure to the S&P 500 Index.
Find out more: http://bit.ly/KGI_CMEemini
3. PBOC vows more liquidity after surge in China money market rates
4. Oil dips as global supply concerns ease
5. U.S. Home Prices Rose to Record in August
6. US Dollar rises near monthly highs ahead of Fed decision
kgi: TRADING IDEAS: 🇸🇬 SINGAPORE
TRADING IDEAS: 🇸🇬 SINGAPORE
1 November 2023
🏙 Banyan Tree Holdings Ltd. (BTH SP): Growing expansion plans
BUY Entry 0.385 – Target – 0.410 Stop Loss – 0.373
🏢 Genting Singapore Ltd (GENS SP): Bottoming out
BUY Entry 0.86 – Target – 0.92 Stop Loss – 0.83
➡️ Read More: https://www.kgieworld.sg/research/nov01sg23
kgi: Technical Analysis: 1 November 2023
Technical Analysis: 1 November 2023
🇸🇬 SG
Sheng Siong Group Ltd. (SSG SP)
COSCO Shipping International (Singapore) (COS SP)
🇭🇰 HK
Remegen Co Ltd (9995 HK)
CSPC Pharmaceutical Group Ltd (1093 HK)
Read More: https://www.kgieworld.sg/research/nov01ta23
CIMB
SIN: Strategy Note - Oct wrap-up: Singapore in 5
CHN: Property - Overall - Weak Oct sales despite policy support
APAC: ASIA Pacific Daily - 01 November 2023
Equity Research Reports....
▌ TARGET PRICE CHANGES...
CHN: Inner Mongolia Yili Indus-A (ADD, tp:CNY41.00▲) - Recovery well on track (31/10)
CHN: Luzhou Laojiao (ADD, tp:CNY290.00▲) - Strong orders for the upcoming CNY (31/10)
IND: Bank Negara Indonesia (ADD, tp:IDR5,900.00▲) (HC)(ESG) - Accelerating the growth momentum (31/10)
KR: Amorepacific Corp (ADD, tp:KRW190,000.00▲) - Anticipating a positive outlook for 2024F (31/10)
MAL: Bursa Malaysia (HOLD, tp:MYR6.90▲) - A post-election recovery in equity ADTV (31/10)
THB: Home Product Center (ADD, tp:THB14.40▼) (ESG) - 3Q23 earnings a slight beat (31/10)
▌ STRATEGY & ECONOMIC NOTES...
SIN: Strategy Note - Oct wrap-up: Singapore in 5 (31/10)
THB: Economic Update - Great read-through for Thailand’s 3Q23 GDP (31/10)
▌ SECTOR & COMPANY NOTES...
HKG: BYD Co Ltd (ADD, tp:HKD389.00) (ESG) - Strong EV deliveries to continue (31/10)
IND: Cement (OVERWEIGHT) - 3Q23 results recap (31/10)
KR: Samsung Electronics (ADD, tp:KRW115,000.00) (HC) - Higher bit growth guidance for 4Q23F (31/10)
MAL: Oil & Gas - Equipment & Svs (NEUTRAL) - New FSU for PLNG2: MISC & Dialog impact (31/10)
SIN: CapitaLand Ascott Trust (ADD, tp:SGD1.32) (HC) - Sequential recovery in progress (31/10)
SIN: Grab Holdings (ADD, tp:USD4.50) - Introduces variable commission rate in SG (31/10)
THB: Muangthai Capital (REDUCE, tp:THB36.00) (ESG) - Likely high NPL and credit costs in 3Q23F (31/10)
THB: Siam Global House (ADD, tp:THB19.90) (ESG) - 3Q23 results in line (31/10)
THB: Property Development (NEUTRAL) - 4Q23F should be better (31/10)
▌ RECENT 'IDEAs OF THE DAY'...
MAL: Strategy Note - Budget 2024: policy continuity (14/10)
MAL: Economic Focus - Budget 2024: Raise revenue, cut spending (14/10)
THB: Hana Microelectronics (ADD▲, tp:THB80.00▲) (ESG) - Multiple tailwinds to drive OP growth (10/10)
MAL: Strategy Note - One step at a time (4/10)
MAL: Economic Focus - Budget 2024 Preview: Tightening purses (2/10)
ASEAN: CGS-CIMB ASEAN Daily - 01 November 2023
Equity Research Reports....
▌ TARGET PRICE CHANGES
IND: Bank Negara Indonesia (ADD, tp:IDR5,900.00▲) (HC)(ESG) - Accelerating the growth momentum (31/10)
MAL: Bursa Malaysia (HOLD, tp:MYR6.90▲) - A post-election recovery in equity ADTV (31/10)
THB: Home Product Center (ADD, tp:THB14.40▼) (ESG) - 3Q23 earnings a slight beat (31/10)
▌ ECONOMIC & STRATEGY NOTES
SIN: Strategy Note - Oct wrap-up: Singapore in 5 (31/10)
THB: Economic Update - Great read-through for Thailand’s 3Q23 GDP (31/10)
▌ SECTOR & COMPANY NOTES
IND: Cement (OVERWEIGHT) - 3Q23 results recap (31/10)
MAL: Oil & Gas - Equipment & Svs (NEUTRAL) - New FSU for PLNG2: MISC & Dialog impact (31/10)
SIN: CapitaLand Ascott Trust (ADD, tp:SGD1.32) (HC) - Sequential recovery in progress (31/10)
SIN: Grab Holdings (ADD, tp:USD4.50) - Introduces variable commission rate in SG (31/10)
THB: Muangthai Capital (REDUCE, tp:THB36.00) (ESG) - Likely high NPL and credit costs in 3Q23F (31/10)
THB: Siam Global House (ADD, tp:THB19.90) (ESG) - 3Q23 results in line (31/10)
THB: Property Development (NEUTRAL) - 4Q23F should be better (31/10)
▌ RECENT 'IDEAs OF THE DAY'...
MAL: Strategy Note - Budget 2024: policy continuity (14/10)
MAL: Economic Focus - Budget 2024: Raise revenue, cut spending (14/10)
THB: Hana Microelectronics (ADD▲, tp:THB80.00▲) (ESG) - Multiple tailwinds to drive OP growth (10/10)
MAL: Strategy Note - One step at a time (4/10)
MAL: Economic Focus - Budget 2024 Preview: Tightening purses (2/10)
Trendspotter of the day (SIN/HKG/MAL): 1st November 2023
Please refer to below for the technical charts of the day.
SIN
Bullish trend remain intact, continuation likely
Bottoming out
HKG
Strong uptrend to carry on
Bullish uptrend intact
Bullish trend likely to continue
MAL
New uptrend?
Flag breakout
CGS-CIMB SG/Msia Preview 01 Nov
SINGAPORE DOW +124pts (+0.4%) NDQ +62pts (+0.5%) SPX +27pts (+0.6%) WTI (-1.6%) GOLD (-0.1%) US stks closed higher on Tuesday, ahead of Fed’s rate decision, with mkt participants expecting a pause tonight. All 11 S&P sectors recorded gains with Real Estate leading the pack. CAT -6.65% plunged on lesser-than-expected sales forecast for Q4. Consumer confidence (102.6 vs 104.3 prior) fell while Employment Cost rose (1.1% vs 1.0% prior) MoM. US 10Y rose 4bps to 4.93%. FSSTI poised for a positive opening on the back of US overnight performance. Focus of the day; CLAS, JAP, CSE, DFI. CGS-CIMB Highlights * Strategy Note FSSTI closed Oct 23 at 3,067.74 pts, down 149.67 pts (-4.65%) mom. CY23 NODX revised downwards (-15% yoy); CPI revised up (5% yoy). Our FY23F FSSTI target is unchanged at 3,350 pts (based on 10.5x CY23F core market EPS). * Grab (GRAB US) introduced a dynamic commission structure for its SG drivers. New fees vary from -10% to 25% of total fare, replacing fixed rate of 20% and long distance pickup bonus of S$3. We see limited impact on its margins. Grab sees this as a continuation of its strategy of driving profitable growth,and reaffirmed its mobility segment steady-state margin guidance. Add; TP:US$4.50. * Capland Ascott Tr (CLAS SP) 3M/9M23 gross profit +13%/23% yoy, which we deem in line. 3Q23 RevPAU was at 102% of 3Q19 levels; 6 out of 8 key markets performed at above-3Q19 levels. Reiterate Add; TP: S$1.32. CLAS is our top pick in the sector. * Paragon Reit (PGNREIT SP) 9M2023 portfolio gross revenue +1.2% yoy to S$215.6m, in line at 72.1% of our FY23F. 3Q23 tenant sales +1%/9% yoy in Singapore/Australia. Portfolio occupancy improved qoq to 98.1%. No reversion numbers shared, to recap, 1H23 portfolio reversion turned positive at 6.9% (FY22: -4.1%). Gearing remains low at 30.1%, with fixed debt of 85%. Cost of debt increased qoq from 4.05% to 4.21% . Expect neutral share price reaction. Hold; TP: S$1.01. * Japfa (JAP SP) core net profit of US$32.4m in 3Q23, forming 93% of our implied 2H23F net profit of US$34.8m and a reversal of US$43.8m qoq to return to profitability. Stable feed margins and positive DOC ASPs drove poultry breeding back into profitability. We see positive share price movement as JAP has fallen and currently trading at a trough of 0.35x P/B; JPFA could see stronger share price movement as disclosures suggests feed costs have come under control. Analyst briefing will be held this morning, more details to follow. Last call: Reduce; TP: S$0.20 * CSE Global (CSE SP) reported 3Q23 order wins of S$302m (+83% yoy). Infra was the main driver (+309% yoy) as CSE won several major electrification projects in the US. Order book at new high of S$638m. YTD order wins are now at 84% of our FY23F forecast. We see upside to our infra win assumptions (YTD at 99% of our FY23F). Assuming FY23-24F infra order wins are raised by c.S$150-200m, our TP could go up by 3-4 Scts Last call was Add at TP of S$0.54, results released next Thurs 9 Nov. Expect positive share price reaction. OTHER NEWS * Capland Invest (CLI SP) annc establishment of inaugral wellness and healthcare-related real estate fund, CapitaLand Wellness Fund (C-WELL) with Thailand’s PSH. * Great Eastern (GE SP) 3Q23 results, total weighted new sales -21% y/y, profit from insurance business +14% y/y, profit to shareholders +65% y/y. Long-term outlook remain positive despite inflationary and interest rate challenges. * Frasers Cpt Tr (FCT SP) completes divestment of Changi City Point for S$338M. * DFI Retail (DFI SP ) 89.3% owned subsidiary, PT Hero Supermarket 3Q23 results. Rev +18% with profit of Rp 19 billion, compared to Rp 85 billion loss in 2022, from divestment gains. * Parkwaylife Reit (PREIT SP) 3Q23 results, y/y basis, rev +24.6%, DPU +2.8% to 10.99 cts. Gearing at 36% with 12.8x ICR and 1.32% of debt cost. 74% of interest rate hedged for JPY until 1Q2027. * First Reit (FIRT SP) 3Q23 update, rev +0.6% y/y, DPU -6.1% y/y to 1.86 cents. 85.9% of debt on fixed rates. MALAYSIA Asian stock markets had mixed performance due to weak China PMI data and the unchanged BOJ policy rate. The KLCI in Malaysia increased slightly by 0.20% to 1,442.14, with most sectors rebounding except for transportation and consumer products. Utilities, property, and healthcare sectors performed well. Trading volume and value improved. The KLCI has been trading in a sideways pattern, staying above the 1,430-1,438 support. It may test the 1,450 resistance if there's bullish momentum, with potential for further gains. However, a drop below 1,430 could lead to consolidation, with support around 1,412-1,416. Market sentiment may be influenced by upcoming interest rate decisions by Bank Negara and the US Fed. 🔴CGS-CIMB Highlights *Bursa Malaysia (BURSA MK)- A post-election recovery in equity ADTV (Maintain Hold with a higher TP of RM6.90) https://bit.ly/3FG4tCc *Oil & Gas - Equipment & Svs - New FSU for PLNG2: MISC & Dialog impact (Maintain Neutral) https://bit.ly/3MoENxS 📰💼COMPANY NEWS💼📰 *MISC Bhd (MISC MK) has bagged a contract to supply, operate and maintain a liquefied natural gas (LNG) floating storage unit (FSU) in Pengerang, Johor with an estimated contract value of up to US$213.7m (RM1.02bn). The vessel operator said it has entered into a binding heads of agreement with Pengerang LNG (Two) Sdn Bhd — a 65%-owned unit of Petronas Gas Bhd (PetGas) to supply, operate and maintain the FSU. *CIMB Bank (CIMB MK) and Japanese finance company J Trust are among firms vying to buy Indonesia's PT Bank Commonwealth in a deal that could value the lender at US$400m (RM1.91bn) to US$500m, two sources with knowledge of the matter said. Morgan Stanley, the financial adviser on the sale, has asked bidders to submit binding offers by early November, the sources added. *Berjaya Land Bhd (BJLAND MK) has secured a syndicated loan of US$330m (RM1.58bn) from a consortium of Japanese financial institutions to fund the development of the prestigious Four Seasons Resort & Private Residences in Okinawa, Japan. *Dagang NeXchange Bhd*’s (DNEX MK) sub-subsidiary Innovation Associates Consulting Sdn Bhd (IAC) has secured a project from the Securities Commission Malaysia for the implementation of the Aras 2.0 onboarding and data migration platform for RM3.09m.
Lim&Tan
MayBank
[Maybank IBG Research] Today's Research - Singapore
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CDL Hospitality Trusts | On an even keel Krishna Guha
Civmec Ltd | Firmly on course Eric Ong
Aztech Global | Solid 3Q23 Jarick Seet
PTT Global Chemical | Double whammy; initiate SELL Chak Reungsinpinya
SG Daily Newsletter | Wednesday: Market Shaping News Singapore Research Team
Vietnam Steel | Recovering from a low base | NEUTRAL Hai Nguyen Thanh
[Maybank IBG Research] Today's Research
FEATURED CALLS
Singapore | CSE Global New USD110m order – Buy on dips Jarick Seet
Malaysia Banking | 4.3% YoY loan growth in Sep 2023 | POSITIVE Desmond Ch'ng
Malaysia | Technical Trading Ideas: Buying interest gains traction in mid-cap stocks Nik Ihsan Raja Abdullah
MAYBANK SECURITIES - EM Asia Headlines 011123
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