Monday, June 8, 2015

Stocks to watch: SMRT, CDL, Singtel

THE following stocks had announcements or developments that could affect trading activity on Monday.

SMRT: The train operator has backed out of a bid to venture into the telecommunications industry, after facing criticism over whether it might be distracted from its core business of providing public transport. It said in a Singapore Exchange filing on Friday that it has decided not to subscribe for shares in OMGtel - a subsidiary of wireless systems integrator Consistel that was set up in October 2014 for the purpose of bidding for Singapore's fourth telco licence.

City Developments (CDL): The property and hotel conglomerate stock fell as much as 5.4 per cent on Friday, on news of its impending removal from the FTSE EPRA NAREIT Global Developed index as it did not meet the index's income criterion.
Singapore Telecommunications (Singtel): The telco has launched a cloud-based solution that helps enterprises in Asia Pacific, Australia, Europe and the US simplify the management of their networks. The service, called ConnectPlus Software-Defined Wide Area Network (SD-WAN), has been launched by Singtel in partnership with US company Viptela Inc, a Sequoia-funded start-up founded in 2012.

Singapore's STI opens 0.33% lower on Monday

SINGAPORE share prices opened weaker on Monday, with the Straits Times Index down 11.15 points or 0.33 per cent to 3,322.52 as at 9.01 am, following rising expectations for the Federal Reserve to raise interest rates this year after the recent better-than-expected US jobs data.

Top gainers in early morning trade included City Developments, The Hour Glass, and M1. A total of 84.4 million shares worth S$114.6 million had changed hands as at 9.01am. Losers outnumbered gainers 82 to 49.

Singapore: External worries continue to weigh on STI

A SOFT session that ended with the Straits Times Index (STI) 13.34 points weaker at 3,320.33, low volume of 1.4 billion units worth S$1.01 billion, not much action in blue chips or penny stocks - some brokers rated Monday's trading in the local stock market about as exciting as watching grass grow.

Various reasons were given for the funk the local market has found itself in for many months now - Greece's never-ending debt problems, uncertainty over when the US will raise interest rates, the vast explosion of interest in China stocks despite the country's slowing economy and a withdrawal of liquidity after the US Federal Reserve ended its QE (quantitative easing) programme.

All these factors have combined to drag most regional bourses lower - with the exception of Hong Kong, which has enjoyed large volume and interest following its link to the Shanghai exchange.
On Monday, the STI traded mostly in the red, dragged lower by falls in Singtel, the Jardine stable and the banks. Turnover paled in comparison to Monday last week when volume spiked up to S$1.7 billion, possibly as fund managers sold in anticipation of Singapore having to make way for China 'A' shares in MSCI's emerging market (EM) Index.