singapore stocks hit by global bond yield worries local company earnings 603202015

Singapore stocks ended nearly a percentage point lower on Tuesday, weighed by an overnight negative session on Wall Street, fresh concerns regarding global bond yields, Greek tremors and disappointing company earnings reports.

Indices and sectors

The Straits Times Index (STI) ended 28.47 points or 0.82 per cent lower to 3442.33, taking the year-to-date performance to +2.29 per cent.

The FTSE ST Mid Cap Index declined 0.04 per cent, while the FTSE ST Small Cap Index declined 0.35 per cent.

The Singapore Exchange traded a volume of 1,336.5 million shares valued at SG$1,147.6 million. Losers outnumbered gainers by 284/154.

Amongst the FTSE ST sectors, the top gainers were consumer goods (+1.49 per cent), technology (+0.95 per cent) and utilities (+0.89 per cent). The biggest losers were basic materials (-1.37 per cent), real estate holding and development (-0.98 per cent), financials (-0.96 per cent) and oil and gas (-0.91 per cent).

Stocks

Singapore Post Limited (SGX:S08) said net profit during its fiscal fourth quarter ended March 31 slumped 51.6 per cent to SG$38.5 million from SG$79.6 million in the prior year period, driven by a lack of gains in its investment properties. Overall revenue grew 28.7 per cent to SG$248.7 million. The company said its e-commerce logistics business reported strong growth. “The pace of innovation driven by global ecommerce mega-trends will only intensify. Building our international network and transforming the mindset of everyone at SingPost is how we will create long-term value for our customers and our shareholders,” said SingPost Chief Executive Wolfgang Baier, as quoted by TODAY.

Steel contractor and civil engineering solutions provider Yongnam Holdings Limited (SGX:Y02) said net profit during the first quarter ended March 31 was SG$733,000, swinging from a net loss of SG$1.9 million in the prior year period. Revenue, however, fell 8.2 per cent to SG$65.9 million, and gross profit doubled from SG$2.9 million and SG$5.9 million driven by better project margins, as per Straits Times.

Palm oil producer Bumitama Agri Ltd (SGX:P8Z) said Tuesday that net profit during the first quarter ended March 31, 2015 slumped 41 per cent to 181.57 billion rupiah (SG$18.44 million) from 307.84 billion rupiah in the prior year period, according to Straits Times. Quarterly revenue fell 1.7 per cent to 1.33 trillion rupiah. The results were impacted due to lower selling prices for both crude palm oil and palm kernel, the higher cost of sales, foreign-exchange loss and share of loss of associate companies.

Property company Frasers Centrepoint Ltd (SGX:TQ5) is issuing seven-year bonds of a value of SG$200 million at par on a yield of 3.65 per cent. Of this, SG$150 million is earmarked for the public and the balance of SG$50 million for institutional investors. The company said it would cancel the issue if it received demand of less than SG$75 million, while it would increase its size to SG$500 million in case of good demand.

Wing Tai Holdings Limited (SGX:W05) said net profit during the third quarter ended March 31 crashed 93 per cent to SG$2.9 million, while revenue rose 14 per cent to SG$174.2 million. The company said lower contributions from development properties impacted net profit performance.

SIA Engineering Company Limited (SGX:S59) said net profit during the fourth quarter ended March 31 fell 36.5 per cent to SG$41.4 million while revenue slipped 11.3 per cent to SG$276.0 million, primarily due to lower revenues following an overhaul of airframe and components.

Asian Pay Television Trust (SGX:S7OU) reported a net loss of SG$5.56 million for its first-quarter ended March 31 versus a profit of SG$17.89 million in the prior year period. The swing from profit to loss was largely due to the continued deployment of digital set-top boxes and network expansion in the Greater Taichung region of Taiwan. Revenue grew 6.6 per cent to SG$82.29 million.

Golden Agri-Resources Ltd (SGX:E5H) said net profit during the first quarter ended March 31 fell sharply by 83.5 per cent to US$17.2 million (SG$23 million) while revenue slipped 18.9 per cent to US$1.55 billion. Results were hit by lower average crude palm oil prices and weaker production output in Indonesia due to dry weather conditions, the company said, according to Straits Times. "The average international crude palm oil price reduced by 26.5 per cent from US$865 per tonne in 2014 first quarter to US$636 per tonne… Revenue from plantation and palm oil mills segment decreased by 32 per cent to US$340.9 million," it said.

Oil and gas services company Rotary Engineering Limited (SGX:R07) said net profit in the first quarter ended March halved to SG$7.07 million from SG$14.4 million in the prior year period, while revenue plunged 55 per cent to SG$89.39 million from SG$199.17 million, following the completion of major projects, according to Business Times.

UOL Group Limited (SGX:U14) said net profit during the first quarter ended March 31 plunged 39 per cent to SG$74.2 million primarily due to the once off gain from the sale of land at Jalan Conlay in Malaysia in the prior year period. However, revenue fell 42 per cent to SG$238.3 million, due to the same transaction effect. Excluding the SG$218.5 million revenue from the land sale, its property development revenue more than doubled from SG$29.4 million in the first quarter of last year to SG$77.3 million in Q1 2015, according to Business Times.

OKH Global Ltd (SGX:S3N) swung to a loss of SG$1.63 million for the third quarter ended March 2015 from a net profit of SG$642,000 a year ago, due to the absence of development income and lower income from third party construction services, partly offset by higher income from property investment. Revenue dipped 24 per cent to SG$6.08 million from SG$7.99 million, according to Business Times.

Economic news, currency and insight

Flash estimates from SRX Property showed that resale prices of private non-landed homes fell 0.7 per cent in April compared to March, while the number of resale units sold in April was down to 440, 2.7 per cent lower than 452 units sold in March. According to consultants, buyers are focusing on recent new property launches that have possibly diverted some attention away from the resale market. Other factors could be “investment phobia” and pessimism amongst resale homebuyers due to the tougher leasing conditions and recent reports of loss-making re-sales by some owners. "Buyers generally are opportunistic now, preferring to get a property when they can slash price substantially from the owner, but they will be sceptical about the investment potential if, indeed, the owner has to cut price to offload the property," said R'ST Research director Ong Kah Seng.

On Wall Street, stocks ended with losses as investors’ apprehensions regarding the impending US fed rate hike were compounded by a selling rout in bonds that sent yields leaping across the globe. "In the short term, the market is a hostage to interest rates,” said Jim Awad, managing director at Plimsoll Mark Capital, according to Reuters. “To the extent you have an increase in interest rates that the Fed doesn't control, you're getting an unwanted tightening in the financial markets." The Dow Jones Industrial Average fell 36.94 points, or 0.2 percent, to end at 18,068.23. The S&P 500 lost 6.21 points, or 0.29 percent, to finish at 2,099.12 and the Nasdaq Composite dropped 17.38 points, or 0.35 percent, to 4,976.19.