losses in large cap stocks in marine and banking sectors push singapore down 192922015

Blue-chip Singapore stocks took it on the chin in Thursday’s trading, led by ComfortDelGro Corporation Ltd (SGX:C52) which slumped 5.1 per cent to SG$2.98. The three big banks’ stocks all lost between 0.5 per cent to 0.82 per cent, while rig builders Keppel Corporation Ltd (SGX:BN4) and Sembcorp Marine Ltd (SGX:S51) were down 1.26 per cent and 0.99 per cent respectively.

Indices and sectors

The Straits Times Index (STI) ended 25.4 points lower or -0.74 per cent to 3,419.17, taking the year-to-date performance to +1.61 per cent. The FTSE ST Mid Cap Index declined -0.87 per cent, while the FTSE ST Small Cap Index declined -0.43 per cent.

The SGX traded 1,031.4 million shares valued SG$1,091.5 million. Losers outnumbered gainers by 247/184.

Amongst the FTSE ST sectors, the only gainers were healthcare (+1.30 per cent), telecommunications (+0.74 per cent) and technology (+0.39 per cent). The top losers were maritime (-2.45 per cent), consumer services (-1.68 per cent), China (-1.49 per cent), basic materials (-1.35 per cent) and real estate (-1.00 per cent).

Stocks

Singapore Telecommunications Ltd (SGX:Z74) reported strong results for the three months ended December 31. Net profit jumped 11.2 per cent to SG$970 million from SG$872 million in the year prior period, according to TODAY. Revenue was up 3.8 per cent to SG$4.43 billion due to better growth in its mobile customer base, higher equipment sales and acquisitions. “In Singapore and Australia, we pro-actively acquired and re-contracted customers on the back of smartphone launches and successfully upgraded them to higher-tiered data plans,” Singtel chief executive Chua Sock Koong said. The stock ended 0.97 per cent higher at SG$4.18, while Nomura Research reactivated its Buy call on the company.

Singapore Airlines Ltd (SGX:C6L) fell 1.39 per cent to SG$12.03. The airline said it will cut its fuel surcharge for tickets issued from February 26 onwards, saying "fuel prices have declined in recent months, although jet fuel continues to account for a significant percentage of SIA group expenditure," according to a news item in Business Times. "Holding the view that fuel prices remain lower for longer, we think that SIA will be likely to ensure significant fuel cost savings as it enters into FY2016," a Morgan Stanley research report said this week.

Sembcorp Marine Ltd (SGX:S51) ended lower by 0.98 per cent to SG$2.99 after the company reported that net profit fell 4.6 per cent in the fourth quarter compared to the year prior period due to a slowdown in its rebuilding business and a tax benefit in the previous year period. In the quarter ended December 31 the company earned a net profit of SG$174.1 million, down from SG$182.4 million previously, while revenue slipped sharply by 14.6 per cent to SG$1.4 billion, reported the Straits Times. The company revealed that Sete Brasil, a company set up by Petrobras, owed it between SG$70-SG$80 million on orders for rigs.

Swiber Holdings Ltd (SGX:AK3) rose 1.09 per cent to SG$0.185 after the company announced that it had secured an EPCIC contract worth about US$310 million (SG$422 million) from a national oil company in South Asia, according to the Straits Times. This was the second largest contract win in the group’s corporate history, and was received from a customer for which the company had previously completed a float over platform installation project.

Lum Chang Holdings Ltd (SGX:L19) fell 1.41 per cent to SG$0.350 despite the company reporting a net profit increase of 131 per cent during the three months ended December 31 of SG$7.25 million, compared to SG$3.14 million in the year prior period, led mostly by currency gains related to the weaker ringgit currency. "The loss for the corresponding period last year arose mainly in respect of the translation of the company's Malaysian ringgit-denominated receivables from a subsidiary," the company said according to Business Times.

iFAST Corporation Ltd (SGX:AIY) gained 0.76 per cent to SG$1.33 despite the company’s announcement that fourth-quarter net profit plummeted 67 per cent compared to the year prior period due to higher costs. Quarterly net profit during the quarter ended December 31 was only SG$949,000 compared to SG$2.9 million last year. However, revenue was higher by 17.7 per cent at SG$19.8 million due to significant growth in Hong Kong and Malaysia businesses as well as the company’s Singaporean operations, said the Straits Times.

Manufacturer of precision engineering components, Amtek Engineering Ltd (SGX:M1P) fell 0.79 per cent to SG$0.625. It reported a 74 per cent jump in net profit during the second quarter ended December 31 to US$11.3 million (SG$15.32 million), while revenue jumped 60 per cent to US$263 million.

Oxley Holdings Ltd (SGX:5UX) closed lower by 0.97 per cent to SG$0.510. The developer said net profit in its second quarter grew 11 per cent to SG$22.2 million, while revenue was up 16 per cent to SG$235.5 million. The company attributed the rise in revenue due to a revenue recognition adjustment on the basis of completion-of-construction method on its 38-unit commercial and office building, Robinson Square.

Real estate and investment firm Rowsley Ltd (SGX:A50) jumped 3.09 per cent to SG$0.200 after it announced an agreement with Vietnam's Hoang Anh Gia Lai Joint Stock Company (HAGL) to jointly develop a mixed-use development in Yangon, Myanmar, according to the Straits Times. Rowsley said it will invest US$275 million (SG$374.23 million) for a 50 per cent stake in a company that wholly owns HAGL Myanmar Centre, one of the country's largest integrated projects with four office blocks, a five-star hotel, a retail mall, serviced apartments and residential apartments.

Beverages and dairy company Fraser and Neave Ltd (SGX:F99) said fourth-quarter net profit was down by 0.8 per cent to SG$35.7 million, while revenue was up 9.7 per cent to SG$655 million. The beverages division grew revenue thanks to soft drinks and beer operations, while the dairy business earned higher revenues from operations in Singapore, Malaysia and Thailand, according to the Straits Times.

Shares of Nam Cheong Ltd (SGX:N4E), a Malaysia-based offshore support vessel builder, were down 2.19 per cent to SG$0.325 after the company reported a 42 per cent year-on-year fall in net profit to RM41.1 million (SG$15.5 million) for the fourth quarter ended Dec 31, 2014, due mainly to higher expenses and lower income tax benefits. Revenue rose 29 per cent to RM523.9 million.

The SGX has issued a “trade with caution” notice on UOL Group Ltd (SGX:U14) after the company stock jumped 6.4 per cent in Wednesday’s trading. The company, in response to a query, said it was not aware of any reasons for the jump. "In view of the trading activities observed and the issuer's response, shareholders and potential investors should exercise caution when dealing in the securities," the SGX said, as reported by the Straits Times.

Economic news, currency and insight

Singapore stocks are likely to benefit on opening due to the sharp upswing on Wall Street overnight.

The Dow Jones Industrial Average rose 110.24 points, or 0.62 percent, to 17,972.38, the S&P 500 gained 19.95 points, or 0.96 percent, to 2,088.48, and the Nasdaq Composite added 56.43 points, or 1.18 percent, to 4,857.61, according to Reuters, due to a rally in technology stocks and news of a ceasefire agreement between Russia and Ukraine.

Leaders of Germany, France, Russia and Ukraine thrashed out an agreement to end the conflict in eastern Ukraine, leading to a jump in oil prices and helping stocks in the energy sector. The NASDAQ powered to a 15 year high.