Market Notes: Lost Decade in Singapore Straits Times Index (STI)

If you have noticed, I don't really post much of the Singapore companies that are listed in the Singapore Stock Exchange (SGX). 

If we compare the charts of STI against HSI and S&P 500, we will notice that STI has been really under water and with this pandemic, it is almost like a lost decade with no real economic move for Singapore blue chips in particular. 

STI performance for past 13 years since GFC (2007 - 2020)

With its peak during 2007 at 3837 and crashing through the floor during 2008-2009, it has never managed to break its highs and its last highest point was at 3624 during May 2018 before starting the downtrend. It is good to note that STI has always been a very sensitive barometer against the global economy as Singapore is always heavy in global trade. 

However in recent years, STI has failed to lure any big Tech firms to be listed in Singapore resulting in the 3 local banks forming a big part of STI.  

HSI performance for the past 13 years since GFC (2007-2020)

Looking at the performance of Hang Seng Index for the past 13 years as well, it exceed its 2007 highs at 31,897 during Jan 2018 at 33,484 before it came tumbling down. You may notice a trend that STI and HSI both started the downtrend in 2018 and it was the year where the trade war started.  

However coming back to the original point, HSI was poised to perform pretty well if not for the trade war and the Hong Kong protest that consumed the city. Now with the new Hang Seng Tech Index in play, we can see that Hong Kong is drawing lots of big Chinese tech companies to list in HSI and also in Shanghai Stock Exchange (SSE) which they are able to avoid scrutiny from the US government. 

S&P 500 performance for the past 13 years since GFC (2007-2020)

Needless to say, S&P 500 has almost increased up to 400% since its low in Mar 2009. This is fueled by limitless money printing from the Feds since then and markets have never looked back. We will notice that the dip started in Oct 2018 and primarily due to the trade war between US and China, Fed increasing its interest rate since 2009 and also tightening their monetary policies. 

Liquidity has always been the game changer here which is likely the main reason why we did not see a total market collapse in Feb/Mar 2020 when the Fed announced QE again with unlimited printing. 

I will cover more about what makes up the STI and some of the blue chips that people may have invested but would likely be in the red over the past 10 years. 

Disclaimer: Whatever posted here is purely my personal view. It is not an inducement to trade and not responsible for any losses. Tips and News might just be rumors in the market. I take no responsibility for any gains or losses as a result of reading my analyses, judgement and opinions. Trade with care and diligence please!

Noble..

As we mentioned this earlier this week, we were looking at this stock with some potential of uptrend. 

Not in it yet but worth keeping it in your watchlist and wait for clearer signs to come out. 

Company name: Noble Group Ltd

Company code: NOBG.SI

About:  Noble Group Limited (Noble) is an investment holding company, engaged in managing the global supply chain of agricultural, industrial and energy products; ship ownership, chartering and the provision of technical ship management services; trade finance; coal mining, soybean and sugar cane crushing activities and ethanol production. Noble operates in three segments: Agriculture, Energy, and Metals, Minerals and Ores. On December 21, 2011, it acquired a 51% interest in Blackwood Corporation Limited. On June 11, 2012, the Company incorporated Noble Chartering Marshall Islands Limited. On June 14, 2012, the Company’s wholly owned subsidiary, Noble Jade B.V., acquired 90.74% interest in Karakubske Khlibopryimalne Pidpryemstvo LLC. In August 2012, its wholly owned subsidiaries, Temmar Netherlands B.V. and Noble Netherlands B.V., sold 100% interest in Temmar - Terminal Maritimo Do Maranhao S.A. to Terminal Quimico de Aratu S.A. - Tequimar, which is controlled by Ultrapar Participacoes S.A.

Looking at recent movements, there was a small gap up from $1.19 to $1.21 from Thursday to Friday and closed above its 20MA. The 50MA and 100MA has also touched but not showing any clear indication whether it will be an uptrend or resistance point yet. Noting that the Stochastics and MACD seems to be picking up but it is still unclear whether we are expecting a consolidation here or break out. Next week would probably be good to monitor this as Noble has been fluctuating along this price range and $1.27 to $1.29 would be the next potential resistance point since it retracted from there for the past 2 weeks. 

Your thoughts? 

Noble..

Looking at Noble.. Will post some comments on that shortly!

No changes in our positions

No changes as markets seem to be inching up prior to tonight for Ben bernanke's speech. If he delivers good news (which we hoped), it should push markets to the next level!

Update on Yangzijiang

We decided to cut our position in this stock as it reached our cut price and doesn't seem to hold its resistance..

Lackluster performance today..

Not much action today, volume wasn't that decent across most of the stocks and it was trading in a narrow band. Even for the new IPO - Far East HTrust wasn't performing that well but it did close higher than its IPO price of $0.93. Our positions remained the same as previous and looking at Europe and US markets at the moment, it seems pretty optimistic and we will see how things go from here! 

STI's performance on Friday

Late post but better than never, our positions remained the same for the Singapore market and volume was once again pretty low in Singapore but the gap down was very minimal. 

Looking at Genting - possible breakout this coming Monday and hitting our target price! CNMC has been trending up and we believe that it will hit our target price pretty soon if market conditions are still favorable! 

Have a great weekend! 

IEV Holdings Ltd

One counter that we have a position on is IEV Holdings. Pretty interesting where we open a position midday after noticing some trends and fitting into our model. 

Company name: IEV Holdings Ltd
Company code: IEVH.SI
About: IEV Holdings Limited (IEV) offers a range of integrated engineering solutions (IES) to support the offshore oil and gas industry in the Asia Pacific region. The Company provides engineering services to companies in the offshore oil and gas sector, such as offshore platform operators and engineering, procurement, construction, installation and commissioning (EPCIC) contractors. It has operations in Malaysia, Indonesia and Vietnam and sales and representative agreements with its agents in Europe, United States, India and China to promote and market its MGC products and services. The Company’s IES is categorized into six main divisions: jacket and pipeline installation solutions (JPIS), structural integrity solutions (SIS), inspection, repair and maintenance solutions (IRMS), life extension solutions (LES), decommissioning solutions (DS) and rigless well intervention solutions (RWIS). In March 2012, it incorporated IEV Energy Investment Pte. Limited in Singapore.

Possible good entry price: $0.565

Target price: $0.62

Cut price for us: $0.51 

Estimated holding time: 1 month or less

Looking at its chart today, we manage to see that it has broken its 50d MA and stayed above today. Resistance was met at $0.585 and retracted to close at $0.57. Looking at its movement currently, it seems to have consolidated for more than a week and today it broke out but hit the resistance that could be seen 2 weeks back. Will we be expecting that it would be hitting $0.585 again and not break out from there? Hard to determine that while we look at the current European and US markets which is down close to 0.8% - 1% at the moment, we still think there's a good chance to hit our target price! 

Your thoughts? 

Watch out for Yangzijiang..

Currently having positions in this, watch out for the review soon!

CNMC

Here's some analysis on CNMC as one of the stocks that we are looking at:

Company name: CNMC Goldmine Hldg Ltd
Company code: CNMC.SI
About: CNMC Goldmine Holding Limited is engaged in the business of exploration and mining of gold and the processing of mined ore into gold dore for subsequent sale. The Company operates in two segments: gold mining and other operations. The gold mining includes exploration, development, mining and marketing of gold. Other operations include investment holding company and provision of corporate services. Its projects include Sokor Gold Project and Nalata Project. The Sokor Gold Project is approximately 80 kilometers southwest of Kota Bharu, the state capital of Kelanta. In July 2010, CMNM achieved its maiden gold pour from the Sokor Gold Project, producing approximately 93.018 ounces of gold dore, which contained approximately 76.252 ounces of refined gold.

Chart source: Reuters

Being listed on October 2011, it has fallen from its high of $0.67 till its current price of $0.35 as of today's closing. Volume is kinda thin for this counter but looking at the trend it's going into since June, it is bending towards a slight uptrend and based on our technical analysis model, we are looking at a possible target price of $0.41. However, we want to be wary of current market conditions as well, as we wanted to be in a more favorable position to enter into this stock. 

Possible good entry price: $0.33 - $0.345

Target price: $0.41

Cut price for us: $0.29 

Estimated holding time: 1-2 months

What's your thoughts on this stock? 

CNMC and HISAKA

We will need to take some time to do some analysis on CNMC and Hisaka soon, however do trade with care as today's market was trending lower after US markets didn't hold its rally. As of now, Europe is also trending downwards with most of the major indexes are falling close to 1% which is pretty healthy considering the fact that markets have been moving upwards for a very long time. We do want to make sure that we open our positions in a favorable market and not when the trend is unclear or falling! 

Looking at the top 10 counters in terms of volume in Singapore market, it was really low and not even one of them went past the 100,000 mark. Based on the volume, we are guessing that the sellers are most probably retail investors or small funds taking profits. 

Some stocks to put in your watchlist

Currently looking at CNMC and HISAKA at the moment.. will post some insights on these two counters soon!

Observations on Wilmar

As I mentioned about Wilmar earlier, this is another counter that we have a position in as well. Looking at the results it posted recently, profits were down almost by 70% on its 2nd quarter results and it could be seen in the charts below where it dropped from $3.40 to close to around $3.10 on 15 Aug opening. 

Good entry price: $3.17 - $3.20
Target price: $3.8
Cut price for us: $2.92 (close to 10% fall)
Estimated holding time period: 2 months

Company name: Wilmar International Ltd 
Company symbol: WLIL.SI
About: Wilmar International Limited operates in seven segments: palm and laurics, comprising the merchandising and processing of palm oil and laurics; oilseeds and grains segment, comprising the merchandising and processing of edible oils, oilseeds and grains; consumer products, which comprises packaging and sales of consumer pack edible oils, rice, flour and grains; plantation and palm oil mills, which comprises oil palm cultivation and milling, and milling segment, which comprises milling of sugarcane to produce raw sugar and by-products. In May 2012, it established Wilmar Switzerland SARL; increased its interest in Natalie Shipping Co Pte. Ltd. to 100%, and Wilmar Europe Holdings B.V. transferred its interest in Wilmar America Inc. In June 2012, it established Biochim SA Yihai (Lianyungang) Speciality Fats Industries Co., Ltd, PT Wilmar Air Indonesia and Piermont Holdings Limited. In July 2012, it established associated companies.

Chart source: Reuters


However, we also want to look at the sell down that occurred in May after it's 1st quarter results. If we look at the volume that occurred, the sell down in Aug is relatively lower than in May even though profit fall in May was 34% compared to 70% in 2nd quarter! 

Looking at the charts for the past 3 years, Wilmar has hit its 3 years low and alot of negative sentiments have been brewing around them. The last time it was at this lows was in Apr-May 2009 period! 

This is some fundamental analysis here, now back to why we entered a position in this counter. We probably look at 2 resistance point in the charts, one at $3.30 (20d moving average) and one at $3.46 (50d moving average). Looking beyond that, we probably look at some resistance here and there between $3.46 to $3.80 (still below 100d moving average). Based on our model that we derived, we are looking at $3.80 which is around 20% gain and around 10% cut price which has to break below $3 (an imaginary resistance). With much upside and downside that we envisioned, we took the bite and enter this counter! 

That's pretty much on Wilmar but as I always say, trade with caution as markets can swing both ways and we can't wait for things to happen! Let us know your thoughts on this counter! 

Coming up next..

Will be posting some insights on our next counter - Wilmar soon.. watch out for this space!

Genting Singapore PLC - When will the West Zone deliver?

Been some time since we posted any views on Singapore stocks. Today let's cover one that we have positions in. Our views on Genting: 

Good entry price:	$1.34 - $1.35
Target price:	$1.42
Estimated holding time period:	1 month

The targeted price is based on current stock movement, current volume which is picking up and some trends that is based on technical analysis which is specifically created to target the Singapore stock market. Do note that the target price and estimated holding time period may change depending on the market conditions and trade with care. 

Chart source: Reuters

Stock code: GENS.SI

Company name: Genting Singapore PLC

About: Genting Singapore PLC is an investment holding company. The principal activities of the Company include the development and operation of integrated resorts, operation of casinos, provision of sales and marketing support services to leisure and hospitality related businesses and investments. The operations in Malaysia, Alderney and other geographical areas in the Asia Pacific are sales and marketing services, online gaming and information technology services. On 27 December 2011, it incorporated Legold Pte. Ltd. On 8 December 2011, it incorporated North Spring Capital Blue LLC, North Spring Investments LLC and Pacific Sky LLC. On 28 December 2011, it acquired Dynamic Sales Investments Limited, Grand Knight International Limited and Greenfield Resources Capital Limited. On 12 September 2011, it acquired Blue Shell International Limited. On 4 November 2011, Calidone Limited and Star Cruise (C) Limited disposed their interest in WorldCard International Limited and its subsidiaries.

Here's the coverage from some brokerage recently as well: 

Source: Investor Central

Q2 Revenue down 3%, Net Profit drops 43%

16/8/2012 – Genting Singapore anticipates improvement in cash flow in 2013 as its capex will slow down and the West Zone of its Resorts World Sentosa will generate additional revenue.

The casino operator also says it fully supports the proposed amendments to the Casino Control Act by the Singapore government.

The company just announced earnings for Q2 FY12:

Revenue: -3% to S$702.2 mln
Profit: -43% to S$138.5 mln
Fair value gain on derivatives: S$11.4 mln vs Nil
Cash flow from operations: S$426.4 mln vs S$318.3 mln
Dividend: Nil

DBS Vickers calls the results 'unexciting' as H1 EBITDA was only 40% of its full-year estimate.

Despite reducing its EBITDA estimate for FY12-FY14 by 3%-6%, DBS Vickers maintains a HOLD rating on the stock with an unchanged target price of S$1.17.

OCBC finds the results slightly below expectations but is worried about the more depressed economic outlook and its impact on the company’s performance.

Therefore, OCBC maintains a BUY rating but with a sharply lower target price of S$1.66 from S$1.97 previously.

Interestingly, Kim Eng's report is titled 'shortfall in 2Q12 results' but in the opening paragraph it says the results were ‘inline’ with estimates.

The broker has cut its earnings estimate for FY12-FY14 by 10%-15%, as it expects VIP volumes to be lower than earlier estimates. 

Therefore, Kim Eng maintains a HOLD rating with a lower target price of S$1.31 from S$1.40 earlier. 

Daily market summary for 23-Apr-2010

The STI Index closed at 2988.49, up by 7.8 points

Top Actives

Name Volume Last Change $ EuNetworks 116040000 0.02 +0.0050 Ellipsiz 86336000 0.16 +0.03 Sunning Tech 65618000 0.275 +0.02 GoldenAgr 63226000 0.61 +0.01 China Hongx 32960000 0.145 -0.01 BRC Asia 31379000 0.14 +0.0050 Jadason 30670000 0.11 +0.015 Yangzijiang 29142000 1.43 -0.05 $ CarrierNet 28675000 0.01 0.0 AsiaFoodP 26410000 0.68 +0.045

Daily market summary for 22-Apr-2010

The STI Index closed at 2980.69, up by 13.04 points

Top Actives

Name Volume Last Change BakerTech 113854000 0.565 +0.06 GMG 83090000 0.23 0.0 Genting SP 64584000 0.86 -0.01 Yangzijiang 53840000 1.48 -0.02 GoldenAgr 43378000 0.6 0.0 CoscoCorp 40409000 1.83 +0.03 VibroPower 38689000 0.1 +0.0050 Z-Obee 27654000 0.6 +0.025 Pac Andes 26066000 0.395 +0.015 Sunning Tech 24812000 0.255 +0.02

Daily market summary for 21-Apr-2010

The STI Index closed at 2967.65, down by -13.72 points

Top Actives

Name Volume Last Change Genting SP 104412000 0.87 -0.02 ChinaNTown 88748000 0.145 +0.02 Yangzijiang 70655000 1.5 -0.05 GoldenAgr 50933000 0.6 +0.0050 JES 49880000 0.24 0.0 GMG 49689000 0.23 -0.0050 Mermaid 45425000 0.805 +0.075 Otto Marine 42295000 0.52 +0.01 StraitsAsia 38772000 2.11 -0.11 CoscoCorp 37905000 1.8 -0.06

Daily market summary for 20-Apr-2010

The STI Index closed at 2981.37, up by 20.44 points

Top Actives

Name Volume Last Change AsiaPower 119651000 0.195 +0.01 Yangzijiang 110625000 1.55 +0.06 CoscoCorp 76856000 1.86 +0.07 $ Lereno R 75656000 0.0050 0.0 GMG 60044000 0.235 +0.01 Otto Marine 51490000 0.51 +0.01 JES 51078000 0.24 +0.035 VibroPower 44066000 0.09 0.0 GoldenAgr 33943000 0.595 +0.0050 ChinaAniH 32315000 0.32 +0.01

Daily market summary for 19-Apr-2010

The STI Index closed at 2960.93, down by -46.26 points

Top Actives

Name Volume Last Change ChinaNTown 124529000 0.125 +0.01 Yangzijiang 117916000 1.49 +0.06 CoscoCorp 75564000 1.79 +0.02 BakerTech 60957000 0.505 +0.07 GMG 58654000 0.225 -0.0050 Genting SP 47981000 0.89 -0.01 GoldenAgr 43596000 0.59 -0.0050 Capitaland 38258000 3.98 -0.12 Ying Li 30556000 0.565 -0.015 Otto Marine 25373000 0.5 -0.025