market-juice

Opportunities
 
Moody's turns bearish on S'pore bank sector. It downgrades outlook to negative on concerns over rapid loan growth and possibility of fall in asset values.
Comments: Non-event. This news came out during lunchtime yesterday. Also, considering all the downgrades since the beginning of the year, Singapore banks’ stock prices have been doing well because they are ranked relatively safer banks compared to their counterparts in the rest of the world.
 
Keppel O&M (BN4, $10.84) will build a 5th jack-up rig to its proprietary KFELS B Class design for Mexican drilling company Grupo R worth US$206m.
Comments: Good news. In 2013 ytd, Keppel has secured new orders worth S$3.6b vs Nomura’s full-year estimate of S$6.5b. Analysts’ target prices are above $12.00.
 
SPH (T39, $4.33) Q3 profit up 81% at $187.5m on fair value gain. Results include $111.4m fair value gain and $26.2m impairment loss; group operating revenue dips 2.1%.
Comments: Slightly below analysts’ expectations. Target price has been reduced slightly by analysts, range from $4.09 to $4.50. Do remember it has a special distribution of 18c coming after the SPH REIT IPO.
 
 
Commentary
 
Flows continue to show the indecisiveness of the money managers despite the Fed holding back tapering measures until mid-2014.
Daily flows show slight profit-taking in US and HK with moderate support for Singapore market.
Volatility in currency markets have been subdued as well, showing that money remains on the side and possibly residing in their respective countries. Not much movement across bonds to stocks as well.
We can see that there is money waiting to be invested however, given the state of the markets at the moment, valuations may not seem as cheap as it has been written. General sentiment has not encouraged much risk taking among money managers.