singapore stocks end lower for the fourth consecutive day 315262015

Singapore stocks spent their fourth session in the red on Thursday, falling to the day’s low of 3,357.11 shortly after 15:00. However, a rally commenced thereafter which retrieved some of the day’s losses but was unable to push the STI into positive territory.

Indices and sectors

The Straits Times Index (STI) ended 4.99 points lower or -0.15 per cent to 3,373.6, taking the year-to-date performance to +0.25 per cent. The FTSE ST Mid Cap Index gained +0.20 per cent, while the FTSE ST Small Cap Index gained +0.16 per cent.

The Singapore Exchange traded a volume of 1,274.3 million shares valued at SG$1,012.5 million. Losers outnumbered gainers by 228/188.

Amongst the FTSE ST sectors, the gainers were utilities (+1.23 per cent), technology (+1.23 per cent), consumer goods (+1.04 per cent), China (+0.45 per cent) and consumer services (+0.43 per cent). The biggest losers were industrials (-0.74 per cent), Catalist (-0.53 per cent), healthcare (-0.41 per cent), oil and gas (-0.31 per cent) and fledgling (-0.16 per cent).

Stocks

Keppel Corporation Limited (SGX:BN4) announced yesterday an extension by two weeks of its SG$3.2 billion offer to buy out Keppel Land Ltd (SGX:K17) shareholders. As of 5 PM Thursday, Keppel Corp had boosted its shareholding in Keppel Land to 85.1 per cent, as per TODAY. The offer will now expire at 5:30 PM on March 26. The company is currently offering SG$4.38 for each share in Keppel Land, but that could increase to SG$4.60 per share if shares tendered cross the 90 per cent threshold.

United Envirotech Ltd (SGX:U19), provider of water treatment solutions, said its net profit for the three months ended the 31 December 2014 rose to SG$12.5 million from SG$8.4 million in the year prior period. Revenue jumped 80.6 per cent to SG$116.07 million, according to Business Times.

Jia Yue Ting, executive chairman of Sinotel Technologies Ltd (SGX:D3W), has made an offer to buy all the shares in the company he does not already own at 9.8 Singapore cents per share in order to take the company private. The stock is not an active counter on the SGX, and last traded at 4.9 Singapore cents on March 9. The offer document said: "In view of the low trading liquidity, the offer represents a cash exit opportunity for shareholders to realise the value of their investments in the company at a premium over the historical trading prices of the shares.”

BlackGold Natural Resources Ltd, an Indonesian-led group of companies engaging coal exploration and mining in the Riau province, has been included in the Catalist board under the stock code of “41H,” as per Straits Times. A statement from SGX said: "SGX continues to grow in appeal as a venue for coal listings. BlackGold Natural Resources is the third coal company to be listed here and our second new coal listing in the last five months. We look forward to partnering the company in its growth ambitions."

According to a report in the Business Times, the Monetary Authority of Singapore met on February 17 and March 4 with representatives of the 1,225 remisiers who had written to Finance Minister Tharman Shanmugaratnam about issues facing the local stock market. The meetings dealt with issues such as how to rebuild confidence in the local stock market, better surveillance, quality of listings, consultation with market participants on new policies and the creation of an environment more conducive for investing and trading, according to a report in Business Times. Also considered was the highly controversial reinstatement of the lunch break within trading hours.

Intraco Limited (SGX:I06) has won a SG$6.6 million arbitration award in its dispute against Timor Global regarding a joint venture agreement between subsidiaries of the two companies, said the Business Times. Against its total gain of SG$9.8 million, Intraco had already received SG$3.2 million prior to the arbitration order.

Economic news, currency and insight

Global port operator PSA International, formerly known as Port of Singapore Authority, said its net profit last year fell to SG$1.4 billion from SG$1.43 billion in 2013, a decline of 1.7 per cent, despite a higher number of containers being handled. “PSA handled a record 65.4 million TEUs in 2014 and experienced volume growth in most markets we operated,” Group CEO Tan Chong Meng said in a statement, as per TODAY.

New research by global professional services company Towers Watson shows that Singapore offers the highest base salaries at senior and top management levels in the region, and that pay scales are 10 per cent higher than the next highest location, namely Hong Kong. The findings were reported in the firm’s 2014/2015 Global 50 Remuneration Planning Report, according to Straits Times.

The three month Singapore Interbank Offered Rate, or SIBOR, the rate used by banks to lend to one another as well as a benchmark for the base rate in mortgages, rose Wednesday to 0.87934 per cent, up 4 per cent from the previous day. This is the highest level seen in 2008, as reported by Straits Times. The rate is up 8.2 per cent since last Friday, when the United States reported better-than-expected employment data, stoking apprehensions of a rate hike by the US Fed.

A report by ratings agency Standard and Poor’s said Singapore’s banks would stand to gain in the event of gradual rate hikes in the economy, said Business Times. The agency observed that variable rate loans would be re-priced upwards in the event of higher interest rates, thereby contributing to higher revenues. However the upside in credit costs would likely be limited due to Singapore’s strong household and corporate balance sheets that support regular debt repayment.

Overnight, Wall Street stocks were up sharply following dollar weakness and the big banks cleared stress tests, allowing them to pass on dividend increases and share repurchases to shareholders. The Dow Jones Industrial Average surged 259.83 points (1.47 per cent) to 17,895.22, the S&P 500 jumped 25.71 (1.26 per cent) to 2,065.95, while the Nasdaq Composite Index rose 43.35 (0.89 per cent) to 4,893.29.

The ECB’s bond buying program induced fresh weakness into the Euro, which plunged to a new 12-year low of US$1.0508 against the US dollar on Thursday.

In regional news, South Korea’s central bank cut its benchmark interest rate by 0.25 basis points to a record low of 1.75 per cent as it battled fears of inflation and slowing economic growth. On Wednesday, Thailand also cut its benchmark interest rate to 1.75 per cent, the lowest since mid-2010 after warnings that the country’s economic growth this year would be below the previous forecast of 4 per cent.