SGX
Economic Calendar :
Phillip Capital Market Reports:
Phillip Daily Morning Note :
US Market (By Phillip Global Markets Night Desk)
11 October 2023
Argus's Favored Classes, Segments
September was a difficult month for investors, as bonds dropped 2.8% and stocks gave back 4.9%. Year-to-date, stocks still hold the performance lead over bonds, with a 12% gain in the benchmark S&P 500 compared to a 3% decline for fixed income. Looking ahead, our Stock-Bond Barometer modestly favors bonds over stocks for long-term portfolios. In other words, these asset classes should be near their target weights in diversified portfolios, with a slight tilt toward fixed income, given the rise in yields to levels near 20-year highs. We are over-weight on large-caps. We favor large-caps for growth exposure and financial strength, while small-caps offer value. Our recommended exposure to small- and mid-caps is 12%-13% of equity allocation, below the benchmark weighting. U.S. stocks have outperformed global stocks over the trailing five-year period. We expect this long-term trend favoring U.S. stocks to continue, given volatile and erratic global economic, political, geopolitical, and currency conditions. That said, international stocks offer favorable near-term valuations, and we target 5%-10% of equity exposure to the group. In terms of growth and value, growth has rebounded in 2023, outperforming value as interest rates have stabilized. Over the longer term, we anticipate that growth, led by the Technology and Healthcare sectors, will top returns from value, led by the Energy and Basic Materials sectors, due to favorable secular, demographic, and regulatory trends.
Market Wrap
Stock futures trimmed gains after hotter-than-estimated inflation data bolstered speculation the Federal Reserve will keep interest rates higher for longer.
S&P 500 contracts rose 0.2%. Treasury two-year yields, which are more sensitive to imminent policy moves, approached 5%. The dollar erased losses. Oil dipped after an early-week surge as the impact on crude flows from the Israel-Hamas war remained contained and Saudi Arabia pledged to help ensure market stability.
Today's Big News
- Exxon to Buy Pioneer for $60 Billion to Dominate Shale Oil
- Israel Latest: Hezbollah, Israel Trade Fire on Lebanon Border
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- Fed’s Bowman Says Higher Rates May Be Needed to Curb Inflation
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- IMF Latest: Gopinath Sees Inflation, Growth Risks If War Widens
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- Yellen Says US Is Not Ruling Out New Sanctions Against Iran
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- Even Google Insiders Are Questioning Bard AI Tool’s Usefulness
OCBC
DBS
Economists expect PPI (producer price index) to gain 0.3% in September
LVMH reports 9% y-o-y rise in 3Q23 revenue on waning post-pandemic spend
HP raises annual dividends, forecasts 2024 profits in line with estimates, on stabilising demand in personal computers market
Regional Plantation
Time for the long-awaited upswing?
Plantation counters to see renewed interest on Brent oil surge
Palm oil currently is the cheapest edible oil in the market – demand set to remain firm
CPO price recovery on track, forecast to average US$1k/MT in 2024 ; peak crops in October and El Nino impact
Who are our top sector picks?
Click here to read our views
Singapore travel recovery plays
Gaining good ground with more legs to run
Visitor arrivals in Singapore continue to be robust with strong yoy growth. September visitor arrivals came in at 1.13m (+44.6% yoy)
Travel recovery gaining good ground with more legs to run; full recovery only expected in 2024
Which stocks do we reiterate our positive stance on?
China / HK Restaurants
Decent table turnover during National Day Holiday
National Day Holiday saw robust growth, particularly in tourist-heavy spots, despite a softer Sept versus Jul-Aug sales
XBXB and JMJ stayed on track on store opening in Sep’23, while Haidilao recorded no store expansion during the month
Yum China (9987.HK) rides on recent hike in store expansion target and digital strategies.
Who do we think are key beneficiaries of this trend?
SEA Ltd (SE US)
3Q23F earnings preview, cautious management
3Q23F result might disappoint the street; share price to be dictated by management’s guidance on 4Q24F profitability
After Indonesia ban, 40% of Shopee’s GMV (gross merchandise value) is exposed to TikTok Shop (TTS); growing regulatory scrutiny in Vietnam & Malaysia might leave just 25% of its GMV exposed to TTS
We cut our e-commerce FY24F adj EBITDA by 25% on cautious competitive landscape
How does this affect our growth assumption for SEA’s e-commerce business?
Click here to read our views
Keppel REIT (KREIT SP)
Equifax’s new workspace opens at Blue & William
Equifax, first anchor tenant at KREIT’s Blue & William office property in North Sydney has officially opened its doors, following a relocation from two separate offices.
Committed occupancy has increased to c.50% from c.38% in 2Q23, bodes well for KREIT.
Blue & William has a 3-year rental guarantee from developer, Lendlease, as such KREIT is being selective to bring good quality tenants into the property
Is committed occupancy at Blue & William in line with our forecasts?
Click here to read our views
DBS Group Research | Equity Picks
Singapore Equity Picks: Read more
Hong Kong Equity Picks: Read more
UOB
UOBKH: Country Dailies: Wednesday, October 11, 2023
Click on the link for Greater China Daily.
Click on the link for Indonesia Daily.
Click on the link for Malaysia Daily.
Click on the link for Singapore Daily.
Click on the link for Thailand Daily.
UOBKH: Retail Market Monitor: Wednesday, October 11, 2023
Click on the link for details.
UOBKH: Regional Morning Meeting Notes: Wednesday, October 11, 2023 [GC Property, 9988 HK, 1093 HK, NCKL IJ, MAL Plantation, MAHB MK, THBEV SP, AOT TB, BEM TB]
Click on the link for details.
KGI
kgi: Technical Analysis: 11 October 2023
Click on the link for details.
kgi: TRADING IDEAS: 🇸🇬 SINGAPORE
TRADING IDEAS: 🇸🇬 SINGAPORE
11 October 2023
🏙 ST Engineering Ltd. (STE SP): Expanding services
BUY Entry 3.86 – Target – 4.06 Stop Loss – 3.76
🏢 Singapore Airlines Ltd. (SIA SP): Expecting a seasonal rebound
BUY Entry 6.50 – Target – 6.90 Stop Loss – 6.30
➡️ Read More: https://www.kgieworld.sg/research/oct11sg23
Top Stories, 11 Oct 2023
1. Asia Stocks Set to Follow US Gains on Rate Outlook: Markets Wrap
2. Micro Ether Futures now live on CME Group. Enjoy the same features of CME's larger Ether futures (ETH) at a fraction of the size and with lower margins, enabling traders of all sizes to manage ether price risk and add diversification.
Find out more: https://www.kgieworld.sg/futures/cme-micro-ether-futures
3. China considers new stimulus to meet growth target
4. Dow adds more than 100 points to notch third positive day, as falling Treasury yields lift stocks: Live updates
5. Crude futures settle down on fewer worries of supply disruptions
6. EUR/JPY Price Analysis: Remains subdued, capped by a bearish-harami candle pattern
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CIMB
SIN: ComfortDelGro - A smoother ride (ADD - Maintained)
SIN: Venture Corporation - 3Q23F net profit likely still weak (ADD - Maintained)
Trendspotter of the day (SIN/HKG/MAL): 11 October 2023
Please refer to below for the technical charts of the day.
SIN
Bottoming out?
HKG
Bullish trend returning soon?
MAL
Triangle breakout
Further upside?
APAC: ASIA Pacific Daily - 11 October 2023
Equity Research Reports....
▍IDEA OF THE DAY (IOD)...
THB: Hana Microelectronics (ADD▲, tp:THB80.00▲) (ESG) - Multiple tailwinds to drive OP growth (10/10)
We expect Hana’s 2H23F core net profit to rise 37% hoh, on the back of a 10% hoh increase in sales and strong GPM tailwinds from a weak THB/US$. While we see lower-than-expected Powermaster sales and output in the next 6 months, we believe its long-term growth trajectory remains intact.
▌ TARGET PRICE CHANGES...
SIN: ComfortDelGro (ADD, tp:SGD1.55▲) (HC) - A smoother ride (10/10)
THB: Star Petroleum Refining (ADD, tp:THB12.00▼) - Hitting a speed bump (10/10)
▌ SECTOR & COMPANY NOTES...
IND: Oil & Gas - Overall (OVERWEIGHT) - Not likely to head into a long-term downfall (10/10)
MAL: Malaysia Airports Holdings (ADD, tp:MYR7.76) - Possible MYAirline collapse? (10/10)
MAL: Brewers (OVERWEIGHT) - If history repeats itself, it’s time for brewers (11/10)
MAL: Oil & Gas - Overall (NEUTRAL) - Winners and underperformers from oil rally (11/10)
▌ RECENT 'IDEAs OF THE DAY'...
MAL: Strategy Note - One step at a time (4/10)
MAL: Economic Focus - Budget 2024 Preview: Tightening purses (2/10)
HKG: Property - Overall - Time to lift some of the “harsh measures” (27/9)
CHN: Navigator-Strategy - Ride out of the bottom (25/9)
SIN: Singapore Post Ltd (ADD▲, tp:SGD0.60▲) - What’s next? (18/9)
ASEAN: CGS-CIMB ASEAN Daily - 11 October 2023
Equity Research Reports....
▍IDEA OF THE DAY (IOD)...
THB: Hana Microelectronics (ADD▲, tp:THB80.00▲) (ESG) - Multiple tailwinds to drive OP growth (10/10)
We expect Hana’s 2H23F core net profit to rise 37% hoh, on the back of a 10% hoh increase in sales and strong GPM tailwinds from a weak THB/US$. While we see lower-than-expected Powermaster sales and output in the next 6 months, we believe its long-term growth trajectory remains intact.
▌ TARGET PRICE CHANGES
SIN: ComfortDelGro (ADD, tp:SGD1.55▲) (HC) - A smoother ride (10/10)
THB: Star Petroleum Refining (ADD, tp:THB12.00▼) - Hitting a speed bump (10/10)
▌ SECTOR & COMPANY NOTES
IND: Oil & Gas - Overall (OVERWEIGHT) - Not likely to head into a long-term downfall (10/10)
MAL: Malaysia Airports Holdings (ADD, tp:MYR7.76) - Possible MYAirline collapse? (10/10)
MAL: Brewers (OVERWEIGHT) - If history repeats itself, it’s time for brewers (11/10)
MAL: Oil & Gas - Overall (NEUTRAL) - Winners and underperformers from oil rally (11/10)
▌ RECENT 'IDEAs OF THE DAY'...
MAL: Strategy Note - One step at a time (4/10)
MAL: Economic Focus - Budget 2024 Preview: Tightening purses (2/10)
SIN: Singapore Post Ltd (ADD▲, tp:SGD0.60▲) - What’s next? (18/9)
THB: Retail (OVERWEIGHT) (ESG) - Stronger after the storm (15/9)
MAL: Malaysia Airports Holdings (ADD▲, tp:MYR7.76▲) - Exciting times to return (13/9)
Lim&Tan
MayBank
HK: DIM SUM DAILY
MY: TRADERS’ ALMAN
Genting Singapore (GENS SP) by Shao Yang Yin
Gulf Energy Development (GULF TB)
by Natchaphon Rodjanarowan
Global Power Synergy (GPSC TB)
by Natchaphon Rodjanarowan B.Grimm Power PCL (BGRIM TB) by Natchaphon Rodjanarowan
GEMADEPT Corp (GMD VN)
by Chuyen Le Nguyen Nhat
Indonesia
PLN starts green hydrogen production Coal industry faces 1 million job losses from global energy transition - research Indonesia to Restrict Entry of Imported Goods
Malaysia
Philippines
Singapore
Thailand
Ministry to stem imports of subpar items PTT agrees to payment delay to help reduce electricity bills Cabinet fixes duck parts export rules with China New attempt to tackle massive SRT debt Vietnam
China
India
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