singapore stocks pressured by losses in telecom consumer goods and property sectors 283232015

Singapore stocks ruled weak throughout the trading session on Thursday. Barring a small rally in the opening hour of trade and another in the late afternoon, the STI closed shop at the day’s low of 3,395.27.

Indices and sectors

The Straits Times Index (STI) ended 20.26 points lower or -0.59 per cent to 3,395.27, taking the year-to-date performance to +0.90 per cent. The FTSE ST Mid Cap Index declined -0.18 per cent, while the FTSE ST Small Cap Index declined -0.17 per cent.

The Singapore Exchange traded a volume of 1,237.7 million shares valued at SG$934 million. Losers outnumbered gainers by 245/167.

Amongst the FTSE ST sectors, the top gainers were utilities (+1.66 per cent), maritime (+0.49 per cent), China top index (+0.29 per cent) and real estate (+0.11 per cent). The losers were consumer goods (-1.31 per cent), telecommunications (-1.19 per cent), technology (-1.01 per cent) and real estate holding and development (-0.82 per cent).

Stocks

Noble Group Ltd (SGX:N21) has pledged to increase its transparency and to provide more disclosures even though it rejected the allegations made by shadowy Iceberg Research regarding its accounting practices, says a report in TODAY. Noble’s chief executive Yusuf Alireza said in a statement: “We recognize that the past two weeks have not only been challenging for us, but also challenging for all of you … Our experience over the past two weeks is a strong message that as a public company we need to accelerate down our current path of increased transparency.”

The Wall Street Journal said that Noble believed Iceberg’s blog had been registered with WordPress by a Seychelles-based special purpose vehicle called Enlighten Ace. According to Noble, Enlighten Ace’s contact person is a former employee whose services were terminated in June 2013 because of misconduct.

Separately, the company clarified that it took the decision to take a SG$200 million impairment charge on its Australian coal investment on the day of its earnings release. The company said it conducted an impairment review of long-term assets on a quarterly basis and decided on February 26 to book the charge according to the most prudent evaluation assumption.

According to a report in the Straits Times, the first phase of an energy-from-waste facility built by Keppel Seghers Belgium and Keppel Seghers UK, both units belonging to Singapore’s Keppel Corporation Ltd (SGX:BN4), has begun commercial operations in Britain.

Jardine Matheson Holdings Ltd (SGX:J36) posted an underlying profit attributable to shareholders of US$1.53 billion (SG$2.10 billion) for the year ended December 2014, up 2 per cent compared to the year ago period, according to Interactive Investor. Consolidated revenue jumped percent to US$62.8 billion. Chairman Sir Henry Keswick said: "As we move into 2015 the headwinds that affected a number of our businesses last year continue to put regional economies under pressure. Nevertheless, our market-leading businesses are trading well, they remain strongly financed, and they are actively pursuing opportunities for growth. As a result, we continue to view the future with confidence."

Jardine Strategic Holdings Ltd (SGX:J37) said net profit during the 12 months ended December 31 was up 7.8 per cent to US$1.83 billion, despite revenue falling 1.3 per cent to US$32.24 billion compared to the previous year, according to a report in Business Times. The company proposed a final dividend of 19 US cents.

Dairy Farm International Holdings Ltd (SGX:D01) said net profit during the year ended December 31 rose 2 per cent to US$509 million, while overall sales improved by 5 per cent to US$13.1 billion (SG$16.4 billion) impacted by a weakness in the food business. The company said the food division underperformed in a number of Southeast Asian markets including Singapore where it suffered weak consumer sentiments, a labour crunch and rising costs, according to the Straits Times.

OCBC Investment Research recommends that shareholders in Keppel Land Ltd (SGX:K17) should cash in part of their holdings considering the offer price is a somewhat rich SG$4.54 to SG$4.55. The deadline for acceptance of the offer is just a week away, according to Business Times.

Economic news, currency and insight

According to an analysis in the Straits Times, China’s economy is afflicted by five major factors, firstly a huge debt pile and bad loans arising from the credit boom of previous years, secondly risks from a collapse in its housing bubble, thirdly excess industrial capacity and zombie firms bleeding cash, fourthly deflationary risks, and finally the extremely difficult responsibility on its policymakers to balance the need for painful structural reforms with the risks of an outright recession and social unrest.

A Knight Frank survey says in its Wealth Report 2015 that Singapore will witness the fastest growth in the number of super-rich individuals over the next 10 years, ahead of Hong Kong, New York, London and Mumbai, as per the Straits Times. The report says the number of ultra-high net worth individuals in Singapore who own net assets of at least US$30 million (SG$41 million) will leapfrog by another 1,752 between the years of 2014 and 2024.

According to a report in TODAY, recent housing data reveals weak demand and a looming oversupply in Singapore’s housing market. The article refers to the February 12 disclosure in Parliament that nearly 10,000 new HDB flats remained unsold under the “Sale of Balance Flats” scheme, and raises the possibility that applicants may have backed out of their commitments to purchase these flats, preferring instead to buy a flat in the resale market, thereby taking advantage of falling prices in the secondary market.