singapore stocks end flat after a range bound session 666622015

Singapore stocks represented by the Straits Times Index ended a shade lower after Tuesday’s session of tired, sideways trading. In the broad market, the number of losers far exceeded winners, showing that the market was much weaker than what the STI’s small loss indicated.

Indices and sectors

The Straits Times Index (STI) ended 0.87 points or 0.03 per cent lower to 3,459.98, taking the year-to-date performance to +2.82 per cent.

The FTSE ST Mid Cap Index declined 0.29 per cent, while the FTSE ST Small Cap Index rose 0.26 per cent.

The Singapore Exchange traded a volume of 1,682.6 million shares valued at SG$824.8 million. Losers outnumbered gainers by 262/218.

Amongst the FTSE ST sectors, the top gainers were healthcare (+1.83 per cent), China (+0.65 per cent), real estate holding and development (+0.36 per cent) and telecommunications (+0.36 per cent). The largest losing sectors were telecommunications (-1.14 per cent), industrials (-0.41 per cent) and technology (-0.40 per cent).

Stocks

According to Straits Times, the Wong family-controlled Phoon Huat & Co, which has been selling baking ingredients in Singapore since 1947, is looking to sell itself and has distributed preliminary information to potential buyers. First-round bids are expected to commence next month, and according to sources, the Wong family is expecting about SG$250 million from the sale.

Infrastructure engineering company Boustead Singapore Limited (SGX:F9D) said net profit for the fourth quarter ended March 31 declined 30 per cent to SG$17.9 million compared to the prior year period, primarily due to a choppy economic environment, as reported by Straits Times. Revenue during the period fell 14 per cent year-on-year to SG$122.3 million due to a weak performance from energy-related businesses and the much lower oil prices.

Eurosports Global Ltd (SGX:5G1), Singapore’s only authorized Lamborghini dealer, said that during the financial year ended March 31, it incurred a net loss of SG$4.02 million, a decline of 123.6 per cent compared to the net profit of SG$17.02 million in the prior year period. Out of the loss, an amount of SG$1.97 million was accounted by goodwill impairment on the acquisition of the AutoInc Eurosport subsidiary. Due to difficult economic conditions as well as tighter loan financing restrictions, revenue grew only 1.6 per cent to SG$40.37 million.

Electronic manufacturing services provider Valuetronics Holdings Limited (SGX:BN2) said net profit during the full year ended March 31 increased 0.9 per cent to HK$149.2 million (SG$25.7 million) while revenue fell 0.2 per cent to HK$2.4 billion, according to Business Times.

Luxury watch retailer Cortina Holdings Limited (SGX:C41) net profit during the fourth quarter ended March 31 surged 28.52 per cent to SG$6.7 million on the back of price adjustments of certain watch brands, according to Business Times.

KV Ventus BV, a wholly-owned subsidiary of Keppel Corporation Limited (SGX:BN4), has acquired a 50.1 per cent stake in OWEC Tower (AS), a Norwegian company primarily involved in designing jacket foundations for offshore wind turbines for about 2.84 million Norwegian krone, making the latter a wholly-owned subsidiary, because KV Ventus BV previously purchased 49.9 per cent in 2012, according to Business Times.

Precision engineering company MMI Technologies has begun discussions with investors regarding an initial public offering in the range US$200 million (SG$269 million) and US$300 million that could be floated in the second half of this year. The company, which is currently owned 70 per cent by US private equity firm KKR & Co LP, manufactures specialized parts for hard disk drives and Seagate Technology is one of its most important customers.

Economic news, currency and insight

According to TODAY, the Singapore Tourism Board is confident that it would achieve its forecast of a 3 per cent growth in tourist arrivals by the year-end, especially now that it is pursuing a SG$20 million global publicity campaign. However, it appears that economists and experts are not so confident. Ngee Ann Polytechnic’s senior tourism lecturer Michael Chiam said: “With the euro falling, Indonesian and Chinese tourists have the option of going to Europe. It’s also more competitive in our backyard, with countries in our region promoting aggressively.”

Preliminary figures from the Singapore Economic Development Board released Tuesday showed that Singapore’s manufacturing activity further declined month of April. Manufacturing output during April fell 8.7 per cent compared to the prior year period, chiefly due to lower production from the pharmaceutical cluster, according to Straits Times. The latest figures mean that Singapore’s factory activity has declined for the last three consecutive months, after falls of 5.5 per cent and 3.6 per cent respectively in March and February.

According to data released by the Ministry of Trade and Industry (MTI) on Tuesday, Singapore’s economy grew at a compounded annual growth rate of 6.4 per cent during the period from 2009 to 2014. However, MTI now expects that the economy will grow only between 2 per cent to 4 per cent per annum during the next five years, against a previous forecast of a growth of 3-5 per cent per annum for the decade overall. "The revised medium-term growth forecast range takes into account downside risks arising from an uncertain global economic environment, as well as the expected slowdown in resident workforce growth due to our ageing population," MTI permanent secretary Ow Foong Pheng said at the release of Singapore's first quarter GDP data, as quoted by Straits Times.

For the first three months of 2015, Singapore’s economy grew 2.6 per cent compared to the prior year period, surpassing the advance estimate of 2.1 per cent issued in April, primarily due to an improved performance from the manufacturing and services sectors, according to Straits Times. For the year as a whole, MTI said it was sticking to its forecast of a growth of 2 to 4 per cent.

Meanwhile, Singapore’s trade promotion agency, International Enterprise Singapore said Tuesday that during the first quarter of 2015 nonoil domestic exports rose 4.8 per cent year-on-year, compared to 0.5 per cent growth in the previous quarter, marking up their best quarterly performance in three years. Exports of electronic products rose 1.2 per cent year-on-year in the first quarter compared to a decline of 4.5 per cent in the previous quarter, said the Straits Times. On the other hand, non-electronic products exports grew 6.3 per cent year-on-year in the first quarter compared to 2.8 per cent in the previous quarter.

Leasing activity data from real estate firm CBRE showed that during the first quarter of 2015, 15,229 leases were commenced in Singapore, up 3.1 per cent from 14,773 leases in the prior year period, according to Straits Times. CBRE attributed the increase to a flight to quality, a phenomenon in which tenants moved out of older or HDB flats into newly built condominiums at lower rents, as well as demand from new permanent residents (PRs). However, rising volume was accompanied by falling rents in all regions of Singapore, with the steepest decline witnessed in the central region where rents fell by 1.9 per cent compared to the prior year period. This was primarily due to increased supply of rental properties, CBRE said.