Morning Highlights

Overnight, equity markets in U.S and Europe plunged on concern an unexpected increase in U.S jobless claims and growing sovereign debt will derail the economic recovery…  US stocks suffered their worst losses in more than nine months on Thursday.

Singapore Market took cue on poor US overnight performance, with the Key STI tumbled down 50.73 points to open at 2694.25. Index is now trading below 2700.

Most of the Singapore Shares gapped down below our entry price, therefore, we have not entered our trades. We advise not to trade on days when US market experienced a wild swing as Singapore market tends to over-react to such poor performance.

Meanwhile, market will attempt to reclaim back to 2700; our sentiment has shifted from neutral to bearish for the time being.

Looks like we are experiencing trend change.... shares are definitely on the downside momentum, so make sure there are no long positions and lookout for shorting opportunity on China Sector, Commodity sector, as well as the Financial Sector. China sector is very weak now.  (update: 11:55)

Corporate Announcement

  1. DBS announced a 4Q09 net profit of S$493 million, up +29% year-on-year (yoy). This brings the bank’s full year net profit in 2009 to S$2.064 billion, unchanged from a year ago. The bank also declared a final dividend of 14 cents per share.
  2. Keppel Corp’s subsidiary KSI Production has formed a JV with Ezra Holdings, PetroVietnam Transportation Corporation and EOC Limited to co-own a Floating Production, Storage, and Offloading vessel slated to serve the Chim Sao project in Vietnam. KSI will invest up to US$30 million in cash for a 20% interest in the joint venture company.

News Updates

  1. US factories orders jumped by an unexpectedly large 1% in December despite a drop in transportation equipment orders, while inventories shrank, a government report showed on Thursday.
  2. US non-farm productivity rose at a 6.2% annual rate after expanding at a 7.2% in the 3Q.
  3. US Initial claims for state unemployment benefits increased 8,000 to a seasonally adjusted 480,000 in the week ended Jan 30, the Labour Department said.
  4. MasterCard quarterly earnings rose 23%, as the world’s No. 2 credit card network was helped by a rebound in plastic-based spending and a weaker US dollar. 
  5. Bank of England pauses 200 billion pound asset buy plan as rates kept at 0.5%‏.
  6. New B. of A. settlement with SEC over Merrill bonuses calls for $150 million payment‏.
  7. Hong Kong's benchmark Hang Seng Index opens down 3%‏

Quick Picks: Here is a quick pick screen that we have designed to pick out potential stocks, both Bullish and Bearish. These are measured with emphasis on larger changes in price and volume. 

Bearish Stocks (Singapore)

Symbol

Name

Entry

SL

TSL

TP

Remarks
1 SIAT Singapore Airport Terminal Services 2.42 2.64 2.20
2 SINO Sinomem Technologies 0.465 0.54 0.39 Not Entered.
3 HBEE Ho Bee Investment 1.60 1.75 1.45 Not Entered.
4 HSEN Hiap Seng Engineering 0.57 0.64 0.50  
5 DBSM DBS Group 14.04 14.52 13.56 Not Entered, share open at 14
6 CTDM City Development 10.48 10.82 10.14 Not Entered, share open at 10.42
7 OCBC Oversea-Chinese Banking 8.07 8.44 7.7
8 OLAM Olam International 2.34 2.47 2.21 Not Entered, share open at 2.30
9 IFAR Indofood Agri Resources 1.91 2.12 1.70
10 AUSG AusGroup Ltd 0.585 0.63 0.54 Not Entered, share open at 0.58
11 UTOS UOL Group 3.70 3.86 3.54 Not Entered, share open at 3.67
12 HPPS Hotel Properties 1.97 2.09 1.85
13 MTHL Metro Holdings 0.77 0.81 0.73 Not Entered, share open at 0.755
14 HONG Hong Fok Corp 0.63 0.685 0.575 Not Entered.
15 NOBG Noble Group 2.78 2.84 2.72 Not Entered.

Stock Prices last updated at 17.25 (Singapore Time)

Afternoon Highlights

Market has managed to reclaim back to 2700, but still exhibit weakness in the overall outlook. Among the 3 banks, UOB is deemed the strongest since the support at 17.90 is yet to be broken. Following next, OCBC has touched support at 8.08, but still holding on. DBS is the least performing bank stock which created a new low of 13.94.

News Updates

  1. Map Technology Holdings Limited said on Friday that its proposed listing of the Taiwan Depository Receipts has been terminated.
  2. Kraft Foods on Friday said it had 75.41% acceptances from Calbury Plc shareholders by 1900 GMT on February 4 in its takeover of the British confectioner and will now move to delist Cadbury no earlier than March 8. (Reuters via Yahoo! News)

In Summary

Market closed down 61.42 points to 2683.56, with 2.165 billion. In terms of this week, market has dropped 61.79 points with 8.0698 billion.

The stocks are weak and with market experiencing selling on high volume indicates a bearish sign. Our Market Outlook is now downward biased. China, Financial and Commodity Sector are on our lookout list for shorting opportunities.

There are a number of stocks that broke out in the mid day, however, as mentioned in the morning, we do not advise any positions for today as market is over-reacting to overnight Wall Street losses. To be on the safer side, we are waiting for new setups.