Economic Calendar :
SGX
Phillip Capital Market Reports:
Phillip Daily Morning Note :
US Market (By Phillip Global Markets Night Desk)
27 September 2023
Fed's Favorite Inflation Indicator Out Friday
The Federal Reserve's favorite inflation indicator, the PCE Price Index, will
be released by the BEA on Friday. The index differs from the Consumer Price
Index in that its composition is changed more frequently and is quicker to
reflect real-time pricing fluctuations. In the report from July, PCE inflation
was 3.3% (the latest CPI report, from August, had inflation at 3.7%). Core
PCE, which removes volatile food and energy prices, was 4.2% in the latest
month, up from 4.1% the month prior. Our forecasts call for a relative
stability on both PCE rates: 3.4% for the headline number and 4.0% for the
core reading. Overall, inflation appears to have peaked in summer 2022 and is
on a downward trek, though the rate of decline is stalling a bit. We track 20
inflation measures on a monthly basis. On average, they indicate prices are
rising at a 3.0% rate year-over-year, up from 2.8% a month ago. The numbers
are distorted by a sharp decline in Producer Price Intermediate Goods, which
are falling at a 27% rate and likely point to easing prices across the inflation
spectrum. Focusing on core inflation -- which we obtain by averaging Core
CPI, market-based PCE Ex-Food & Energy, the core GDP PCE Price Index,
the five-year forward inflation expectation rate, and the 10-year TIPs
Break-even Interest Rate -- our reading is 3.34%, down three basis points
month-over-month. That's largely because sticky prices like shelter and
transportation finally are easing; the Sticky Price Core CPI Index reading is
currently 4.7% versus 5.6% a month ago. Looking ahead, investors are
expecting the Fed's rate hikes ultimately will tame inflation, with the five-year
forward expectation rate at 2.4%.
Market Wrap
A selloff in stocks and bonds eased as calm returned to markets after a rate scare that pushed US shares to their lowest since early June.
US equity futures gained 0.3% while the Dow Jones Industrial Average fell below its 200-day moving average — a technical signal that suggests the index has become oversold and can bounce back. Wall Street’s fear gauge — the Cboe Volatility Index or VIX — retreated after hitting its highest level since May.
Today's Big News
- US Steps Up Probe of Credit Suisse, UBS on Sanction Breaches (1)
-
- Evergrande’s Billionaire Founder Is Put Under Police Control (2)
-
- Alibaba Unit IPO to Test Demand in Slowest HK Market in Decades
-
- US Yield Surge Helps Fed on Inflation, at Risk of Harder Landing
-
- UAW Seeks Pensions as Bargaining Chip in Tough Contract Talks (1)
-
- North Korea to Expel US Soldier Who Bolted Across Border (1)
-
Markets
ValueNet Chg% ChgNikkei Futures32150.00+0.00+0.00Hang Seng Futures17616.00-13.00-0.07CSI 300 Futures3743.80+13.60+0.37S&P/ASX 200 Futures7072.00+4.00+0.06Nifty 5019716.45+51.75+0.26MXEF Index947.18-10.23-1.07S&P 500 Mini4330.75+16.00+0.37WTI92.08+1.69+1.87Brent95.33+1.37+1.46Gold Spot1892.02-8.63-0.45Bloomberg Commodity Index105.77+0.37+0.35Bloomberg Dollar Index1269.24+2.48+0.20Euro1.0544-0.0028-0.26Yen149.20+0.13-0.09Bitcoin26679.19+531.07+2.03US 10Y4.503-0.033-0.717
OCBC
DBS
US consumer confidence fell to 103 in Sept, below estimates
FTC sues Amazon for alleged illegal online marketplace monopoly
Costco’s 4Q EPS of US$4.86, beats estimates
Regional Non-alcoholic Beverages & Packaged Food
Capturing consumers’ mindshare
Global non-alcoholic beverages and packaged food (NABPF) companies with high advertising & promotion (A&P) spend have better pricing power
Expect cost normalisation with falling prices of key raw materials like wheat, CPO, amongst others
What are our preferred picks in this sector?
Click here to read our views
Singapore REITs
Four REITs to avoid as the risk-free rate rises
10-yr yields are on the rise again as investors re-adjust for a higher-for-longer rates environment
US 10-yr yield at 4.52% (+42bps MTD), MAS 10-yr yield at 3.45% (+31bps MTD)
SREITs with blended forward FY23/24F yield spread of less than 2% may face near-term downside pressure, especially if risk-free rates continue to trend higher or stay high
Which SREITs are vulnerable to profit taking as the risk free rate climbs?
Click here to read our views
China Internet
Regulator approved 89 domestic game licenses
Chinese regulator approved 89 domestic game licenses on 25 Sep 2023, similar to the average run rate YTD
China has released 698 domestic game licenses YTD, surpassing the total of 468 in 2022, pointing to a healthy sector development
No new licenses for Tencent and NetEase this round
Why we remain positive on Tencent and NetEase?
Click here to read our views
KE Holdings (2423 HK/BEKE US)
Recent sell-off offers a good entry point
Sell-off yesterday should have fully reflected potential earnings impact from Beijing Lianjia’s unexpected commission rate cut
Our scenario analysis suggests there will still be >20% upside even if commission rate cut is made across all Lianjia stores
Why we believe the sell-off is overdone?
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, September 27, 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, September 27, 2023
Click on the link for details.
UOBKH: Regional Morning Meeting Notes: Wednesday, September 27, 2023
Click on the link for details.
CIMB
ASEAN: CGS-CIMB ASEAN Daily - 27 September 2023
Equity Research Reports....
▌ ECONOMIC & STRATEGY NOTES
IND: Strategy Note - When election boost to consumption is overhyped (26/9)
THB: Economic Update - Thailand’s exports likely bottomed (26/9)
▌ SECTOR & COMPANY NOTES
IND: Sarana Menara Nusantara (ADD, tp:IDR1,475.00) (HC)(ESG) - Key takeaways from SG & KL NDR (26/9)
MAL: Dialog Group Bhd (ADD, tp:MYR2.70) - Adding malic acid tartness to its business (26/9)
MAL: NTPM Holdings (ADD, tp:MYR0.75) - Keep a lookout for a better 2QFY4/24F (26/9)
MAL: SAM Engineering & Equipment (HOLD, tp:MYR4.95) - RPT acquisition lift limited? (26/9)
THB: Ramkhamhaeng Hospital (REDUCE, tp:THB38.50) - Headwinds from new hospitals (26/9)
▌ RECENT 'IDEAs OF THE DAY'...
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)
THB: Oil & Gas Refinery (UNDERWEIGHT) - Diesel-led GRM recovery in 2H23F (12/9)
THB: Hospitals (OVERWEIGHT) - A race for medical tourism in Thailand (8/9)
KGI
TRADING IDEAS: 🇸🇬 SINGAPORE 27 September 2023 🏙 Geo Energy Resources Limited (GERL SP): Profit off from seasonality BUY Entry 0.245 – Target – 0.275 Stop Loss – 0.230 🏢 Yangzijiang Shipbuilding (YZJSGD SP): Double bonanzas-record order book and weak RMB RE-ITEREATE BUY Entry 1.67 – Target 1.80– Stop Loss – 1.61 ➡️ Read More: https://www.kgieworld.sg/research/sep27sg23
Technical Analysis: 27 September 2023
🇸🇬 SG
Food Empire Holdings Ltd. (FEH SP)
Comfort Delgro (CD SP)
🇭🇰 HK
CGN Mining Co Ltd (1164 HK)
Lygend Resources & Technology Co Ltd (2245 HK)
Read More: https://www.kgieworld.sg/research/sep27ta23
Top Stories, 27 Sep 2023
1. Stock futures are little changed after Tuesday’s sharp losses: Live updates
2. Bursa Malaysia East Malaysia Crude Palm Oil Futures (FEPO). FEPO is a Ringgit Malaysia ("MYR") denominated Crude Palm Oil Futures Contract traded on Bursa Malaysia, complementing the existing FCPO contract with specifications designed to meet the needs of market participants with exposure to the East Malaysia palm oil market.
Find out more: https://www.kgieworld.sg/futures/bursa-malaysia-fepo
3. Spot gold briefly loses $1,900 hold on heat from bond yields, 'King Dollar'
4. U.S. House Lawmakers Push SEC’s Gensler to Approve Spot Bitcoin ETF ‘Immediately’
5. Oil prices rebound, settle higher on worries about tight supply
6. AUD/USD holds below the 0.6400 mark ahead of the Australian CPI
-
CIMB
APAC: ASIA Pacific Daily - 27 September 2023
Equity Research Reports....
▌ STRATEGY & ECONOMIC NOTES...
IND: Strategy Note - When election boost to consumption is overhyped (26/9)
THB: Economic Update - Thailand’s exports likely bottomed (26/9)
▌ SECTOR & COMPANY NOTES...
CHN: Brewers (OVERWEIGHT) - Attractive valuation with strong FY24F outlook (26/9)
HKG: East Buy Holding (ADD, tp:HKD71.00) - Douyin GMV recovery (26/9)
IND: Sarana Menara Nusantara (ADD, tp:IDR1,475.00) (HC)(ESG) - Key takeaways from SG & KL NDR (26/9)
KR: LG Chem (ADD, tp:KRW900,000.00) (HC) - Key takeaways from UK/EU NDR (26/9)
MAL: Dialog Group Bhd (ADD, tp:MYR2.70) - Adding malic acid tartness to its business (26/9)
MAL: NTPM Holdings (ADD, tp:MYR0.75) - Keep a lookout for a better 2QFY4/24F (26/9)
MAL: SAM Engineering & Equipment (HOLD, tp:MYR4.95) - RPT acquisition lift limited? (26/9)
THB: Ramkhamhaeng Hospital (REDUCE, tp:THB38.50) - Headwinds from new hospitals (26/9)
▌ RECENT 'IDEAs OF THE DAY'...
CHN: Navigator-Strategy - Ride out of the bottom (25/9)
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)
THB: Oil & Gas Refinery (UNDERWEIGHT) - Diesel-led GRM recovery in 2H23F (12/9)
Trendspotter of the day (SIN/HKG/MAL): 27th September 2023 Please refer to below for the technical charts of the day.
SIN
Bullish mean-reversion
HKG
Bullish break above
MAL
At 7.5-month high
More upside?
Lim&Tan
MayBank
HK: DIM SUM DAILY
MY: TRADERS’ ALMANAC TH: THAI MARKET COMPASS
LHN Ltd (LHN SP) Cebu Air Inc (CEB PM) SSF Home Group (SSF MK)
Comments