Stock Trading Counter:Ringgit, Won join relief rallies driving gains in global stocks

Malaysia's ringgit and the South Korean won rose for a third day as a rally in emerging-market assets continued after last week's selloff in the wake of the U.K. decision to leave the European Union.

The ringgit is less than half a percent away from wiping out losses since the close of trade on June 23 before the Brexit vote rattled markets.

Crude prices climbed back above $50 a barrel on Wednesday, quelling concern about a loss of revenue for Malaysia as Asia's only major net oil exporter.

The won extended its gains as factory output data on Thursday beat all forecasts in a Bloomberg survey, days after the government announced a 20 trillion won ($17 billion) stimulus package.
“I’m looking at the rebound in risk and the firming in oil prices and those factors are very supportive,” said Stephen Innes, a senior trader at Oanda Asia Pacific Pte Ltd. in Singapore. “The global central bankers are in the background and the markets realize that the central bankers are going to stand in front of any capitulation.”

The ringgit strengthened 0.6 percent to 4.0183 per dollar as of 8:43 a.m. in Kuala Lumpur, according to prices from local banks compiled by Bloomberg. The currency has gained more than 2 percent in three days. The won appreciated 0.6 percent to 1,153.60, and is 0.3 weaker than its closing price on June 23

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Stock Trading Counter:ComfortDelGro to 'remain resilient' against Brexit, private hire car services OCBC

OCBC Investment Research on Wednesday said ComfortDelGro is likely to "remain resilient" in the

face of Brexit and private car hires services such as GrabCar and UberX.

The research house maintained its "buy" recommendation on ComfortDelGro with an unchanged $3.40 fair value.

OCBC lead analyst Eugene Chua says ComfortDelGro's price levels are attractive to "buy".

"At the current price levels, we think market has overpriced-in the potential impacts from both Brexit and threat of private hire car services," Chua says.

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Stock Trading Counter:2 STOCKS TO CONSIDER AS CHANGI AIRPORT GETS BUSIER

Ever since budget airlines came into the region, air travel has been increasingly affordable and at times hard to resist the promotion newsletter that they send to your email. This increase is significant as Changi Airport’s passenger traffic is up by 9.2 percent in April as the airport handled 4.79 million passengers.

Aircraft movements also increased as they are 4.3 percent higher with 29,460 landings and takeoffs. Supporting the air movement, cargo shipments increased by 7.2 percent and reached 164,530 tonnes. A further growth can be expected from Singapore air travel movement as Terminal 4 opens next year.

This will lead investors to the important question: How can we benefit from it?

Should We Buy The Airlines?

The first thing that comes to our minds when we talk about air travel will be Singapore Airlines (SIA). However, SIA might not be profiting the most from the increase in air travel as budget airlines have been giving it a run for its money. Profit margin has been under pressure falling over the past five years, only to hold their grounds after oil prices fell sharply.

Regarding airlines, you can look at CoffeeTalk’s coverage on SIA feature here, and Air Asia’s article here.

Who Will Truly Benefit From It?

More aeroplanes will be landing in Singapore as it gains prominence as a hub for air logistics. Earlier this year, DHL Supply Chain has opened a new $160 million logistic facility in Singapore as an anticipation of higher traffic. Investors should be looking at the service providers in Changi Airport whose business will increase along with the traffic and not get squeezed by the budget airlines.

The below two stocks are highlighted by us as the potential companies that are well-positioned to reap from the increase in air travel.

1. SATS
SATS is the main ground handling and catering company at Singapore Changi Airport which makes it best positioned to gain from the air travel growth. The company provides a large range of services from airport security to catering for airlines. An earlier coverage by Aspire on the stock can be found here.

Analysts from Citi Research reiterated their “Buy” call on SATS with a target price of $4.61.

2. SIA Engineering
Not limited to what its name suggests, SIA Engineering (SIE) does more than providing engineering services to SIA. It also provides maintenance services in Changi Airport for different companies and is one of the companies that will see more business opportunities when air traffic increase.

As a well-known dividend stock in Singapore, SIE is trading at an indicative yield of 3.62 percent. However, analysts from DBS Research are not very bullish on the stock as they gave it a “Hold” call with a target price of $3.84. They cited overvaluation due to a lower payout ratio.

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Stock Trading Counter:Stock picks for investors seeking shelter from Brexit UOB

UOB is recommending investors seek shelter in dividend-yielding stocks such as Singtel, ST Engineering, SPH, SATS, REITs and plantation companies on the back of continuing market

volatility in the aftermath of Brexit, according to a report issued on Monday.

Within the REIT space, UOB recommends investors seek refuge in defensive REITs that have no exposure to Europe. These include Parkway Life REIT, Frasers CT and

Mapletree Industrial Trust, with target prices of $2.38, $2.15 and $1.61 respectively.

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Stock Trading Counter:Singapore-listed companies with UK exposure among worst hit

Singapore-listed companies with exposure to the UK market are getting pummelled early Friday as early referendum counts show the UK leaning towards a break up with the European Union.

City Developments, which has a 35% exposure to the British pound according to DBS, falls 5.6% to $8.20. ComfortDelGro (with 17% exposure), Ascott Residence (12%) and CDL Hospitality Trusts (8%), fall 3.3%, 2.2% and 1.7%, respectively.

Sembcorp Industries, which has a 5% exposure, DBS says, is down 3.8%.

In comparison, the benchmark Straits Times Index is 2.4%.

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Stock Trading Counter:Starhill Global still shines among Singapore's retail & office REITs: UOB

UOB Kay Hian is maintaining its "buy" call on Starhill Global REIT (SGREIT) with a higher target price of 92 cents from its previous price target of 91 cents.

To recap, UOB Kay Hian has singled out SGREIT as the sole candidate that "is likely to display more resilience" within the retail sector's challenging climate.

The research house has also identified this particular REIT as a "potential beneficiary of international tourist pick-up", as its Orchard properties Wisma Atria and Ngee Ann City make up 66.5% of its overall portfolio value.

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Stock Trading Counter: 5 companies that may be affected by Brexit: OCBC

OCBC Investment Research is advocating a cautious stance ahead of the UK referendum taking place this Friday, especially toward companies with significant UK exposure.

The research house also maintains its 'overweight' rating on the Singapore market.

"While our base case is for a non-Brexit scenario, we emphasise that the results of the Brexit referendum remain uncertain, and market jitters may yet trigger volatility before the referendum on 23 June," says the research team in a Tuesday report.

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Stock Trading Counter: ComfortDelGro shares gain for third straight day

ComfortDelGro rose as much as 0.7% to $2.75, gaining for the third straight day as investors bet that the UK will vote to stay in the European Union.

The public transport operator earns about 25% of its revenue in the UK and Ireland and has about 14% of its assets there.

Any uncertainty about the future of the UK's economy or currency can hurt the company's outlook.

But, investors seem to be finding value now after ComfortDelGro fell earlier this month amid Brexit worries.

By comparison, the benchmark Straits Times Index is down 0.1%.

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Stock Trading Counter: Net inflow of foreign funds into Bursa reduced to RM100m in 2016

Net foreign inflow of foreign funds into Malaysian equities so far in 2016 has been reduced to only RM100.6mil as at June 17, says MIDF Equities Research, which is the lowest since Feb 26.

Foreign selling in Bursa extended for the eighth consecutive week. The net amount offloaded by foreign investors increased substantially to –RM1.012bil last week from –RM169.9mil the week prior.

“It was the third largest selling since Sept 25, 2015. The estimates are based on transactions in the open market which excluded off market deals,” said the research house.

Foreigners were net sellers on all five trading days last week. Selling momentum was strong at RM180m per day on Monday through Thursday.

“Foreigners started the week with heavy attrition of –RM227.4mil and –RM284.5mil on Monday and Tuesday, respectively. Selling pressure eased slightly to –RM184mil on Wednesday. However, the pace picked up again on Thursday at –RM273mil. Foreigners eventually closed the week with a milder attrition of –RM43.3mil.

“Last week’s foreign withdrawal further reduced the cumulative net foreign inflow thus far this year into share listed on Bursa to an estimated +RM100.6mil, down significantly from prior week +RM1.11bil. It was the lowest figure since Feb 26 this year.

“The figure has been on a declining trend for eight successive weeks. In retrospect, foreigners had offloaded -RM19.5bil and -RM6.9bil in 2015 and 2014 respectively,” it pointed out.

MIDF Research said foreign participation remained moderate last week. It was little changed at RM812.3mil, up +0.3% from prior week.

Excluding off the outlier data point two weeks ago due to foreigners’ mid-year portfolio rebalancing, their participation rate has remained subdued at less than RM1bil for three consecutive weeks.

“Local institution provided support to the market by loading up RM799.1mil on Bursa last week. Despite that, its participation rate declined further to RM1.6bil from prior week’s RM1.9bil. It was the second lowest figure in one year time.

Retail buyers turned active players last week by loading up RM213.1mil. It was their biggest buying since the end of April this year. However, their participation rate has edged down to RM487.8mil,” it said.

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Stock Trading Counter: NODX rises 11% in May rebound

Singapore's non-oil domestic exports (NODX) rose 11.6% in May from a year ago after a 7.9% drop in April.

This was due to the expansion in non-electronic NODX which outweighed the decline in electronic NODX, according to the latest trade numbers released by trade promotion agency IE Singapore.

Electronic NODX slipped 6.0% in May compared to a year ago, down from the 7.4% fall in April. Non-electronic NODX grew 19.0% on year, reversing the 8.1% drop in April.

The largest contributors to the NODX increase were the US, Taiwan and Malaysia.

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Stock Trading Counter : PURCHASE DIVIDEND-EARNING STOCKS AT LOW PRICES AMIDST STOCK MARKET PLUNGE

As I have always said, investors must learn to “invest in stock markets as if you hold no stocks”. Otherwise, you might risk getting a heart attack.

In fact, Monday’s stock market plummet might have indeed triggered heart attacks among investors who couldn’t take things lightly.

Despite Hang Seng Index’s 530-point slump, Link Reit (0823.HK) still reported an increase. Link Reit is quite a good stock which I have never stopped recommending since its listing. However, investing in Link Reit mainly aims to earn dividends. If the stock price increases further and pushes dividend yield to below 3 percent, its attractiveness will be reduced. Such scenario would result in a selling off of the stock – which is why I don’t really wish to see Link Reit rally further and become a speculation stock.

With the exception of Link Reit, other dividend-earning stocks succumbed to downward pressure and plummeted along with market trend on Monday. When the market reports a slump, this is the best opportunity for investors to purchase dividend-earning stocks at lower prices.

Some investors, on the other hand, took the opportunity amid such market adjustment to speculate on some stocks. The concept of very short-term speculation does exist, as some are betting on the outcome of the British referendum later this month.

In the event that Britain chooses to leave European Union (aka Brexit), stock markets are likely to slide further still.

Contrarily, if Britain chooses to stay in the EU, stock markets would rebound. Last week’s survey revealed a sudden surge in the number of Brexit supporters, and such scenario really caught global stock markets by surprise. Before this, most investors had thought that the Brits were too sensible to vote for Brexit.

But taking a step back, note that the British pound did not opt to join Eurozone in the first place – which means Brexit might not really be so detrimental to Britain. On the contrary, the EU would suffer from a fall in its overall strength, having to run without a heavyweight nation such as Britain.

Should Brexit come true, what would happen to debt-laden EU countries such as Greece, Italy, Spain, and Portugal then? No wonder George Soros said he is now back in the game.

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Stock Trading Counter :Singapore REITs to 'hold up in market downturn': S&P Global Ratings

S&P Global Ratings have expressed confidence in the stability of Asia-Pacific REITs, including that of Singapore's.

In a Monday report, analyst Craig W Parker says the region's REITs rated by the research house have "solid business positions and moderate financial positions that are likely to hold up in a market downturn".

Such rated REITs will maintain moderately conservative financial risk metrics that provide a large rating buffer to withstand debt-funded growth and economic shocks.

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Stock Trading Counter : Ringgit opens higher against US dollar

The ringgit was traded higher against the US dollar today on mild buying support and positive sentiment, dealers said.

At 9.04 am, the local unit was quoted at 4.0800/0850 against the US dollar from yesterday’s closing at 4.0890/0940.

A dealer said the local note was expected to be steady on better crude oil prices coupled with increasing doubts about an interest rate increase by the US Federal Reserve.

The ringgit was traded mixed against other major currencies.

It rose against the euro to 4.6080/6140 from yesterday’s 4.6083/6156 and strengthened against the yen to 3.8472/8530 from 3.8572/8630.

The local unit depreciated against the Singapore dollar to 3.0120/0161 from 3.0110/0169 and slipped against the British pound to 5.7977/8056 from 5.7851/7938 on Monday

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