Warrants Highlight

Chinese repurchase "2nd biggest in a single day"

Slowdown in China may worsen
Earlier this week, the World Bank issued a report to lower the growth forecasts for the Asia Pacific region. It gave special mention to the second largest economy in the world, saying that there is a risk that the slowdown in China could worsen and prolong.

In addition, the International Monetary Fund cut its growth estimate for China’s economy to 7.8% mentioning that the “slowing growth in China has affected activity in the rest of Asia”.

China stocks move higher
Despite the reports, investors shrugged off growth concerns with China stocks outperforming the other Asian indices these two days after returning from a week-long holiday. The MSCI Asia Pacific Index fell 1.3% yesterday as compared to Monday’s closing. Yet, indices in China gained with the Shanghai Composite (+2.2%, 2119.94), FTSE A50 futures (+1.6%, 7335) and the Hang Seng Index (+0.5%, 20919.6).

Chinese government hard at work with reverse repos
The strength in Chinese indices came after the central bank boosted liquidity in the system on Tuesday. 265bil yuan was injected into the markets via reverse repurchases in a bid to ease liquidity in markets. According to Bloomberg, this is “the second-biggest amount for a single day since 2004”. The Chinese government has been using reverse repos as an instrument to keep liquidity in the economy, and this underlines the width of financial instruments that the government has at its disposal to boost its economy when the need arises. With due attention given to the state of health in China, import and export figures due to be released this Saturday 13 Oct could dictate risk sentiments next week.

More liquidity to come?
China shares made new highs in the past three weeks, in the midst of speculation that the government will offer further subsidies to boost spending as growth slows in the country. Nonetheless, the Shanghai Composite index still remains at a level that is close to the lows that were last seen during the peak of the financial crisis near end-2008.

Singapore Market Wrap

IMF brings sober news

The International Monetary Fund said that the world's advanced economies are at risk of recession, with a downward revision of global growth forecasts. This led to more pressure on regional markets, with the STI posting it's third straight losing session. The STI was down 1.05% to 3033.81 for Wednesday's trading session.

STI 3250MBeCW121231 (Q4OW) exercise level 3,250.*
STI 3100MBePW121231 (Q4PW) exercise level 3,100.*

STX OSV secures contracts
STX OSV announced that Siem Offshore has declared options for the design and construction of two additional Offshore Subsea Construction Vessels (OSCV). Deliveries
are scheduled from STX OSV Brattvaag in Norway in 2Q 2014. STX OSV already has two OSCVs under construction for the same customer in Norway, and two Platform Supply Vessels in Brazil. Siem Offshore is a listed company on the Oslo Stock Exchange. STXOSV remained flat at $1.57 day-on-day ahead of the news.

STXOSV MB eCW130201 (Q5PW) exercise level 2.50.*

UOB intents to issue US$500 million Medium Term Note
UOB announced that it intends to issue a US$500 million Fixed Rate Subordinated Note at 2.875% p.a. due 2022. It is payable semi-annually in arrear, callable in 2017 and will be issued under the S$5 billion Euro-Medium Term Note Programme. UOB was down 2% to $19.13 for the trading session.

UOB MB eCW130104 (Q8BW) exercise level 19.50.*
UOB MB ePW130104 (Q8CW) exercise level 18.00.*

Overnight Market Wrap

Spain downgraded to one level above junk

Last night, the S&P continued its decline. The index ended 0.6% to close at 1432.56. Energy and materials shares led declines while the financial sector gained.

Investors were worried about the economic situation globally, with Europe's unresolved debt crisis and the US in the midst of its earnings season. Alcoa fell 4.6% after cutting its outlook for global demand of Aluminium, while Chevron Corp lost 4.2% after commenting that earnings this quarter were "substantially" lower than the previous period.

At the end of the trading session, credit rating agency, Standard and Poor's downgraded Spain's rating two levels to BBB- and assigned a negative outlook to the nation's long-term rating. "The negative outlook on the long-term rating reflects our view of the significant risks to Spain's economic growth and budgetary performance, and the lack of a clear direction in the euro-zone policy," S&P said.

Overnight Markets

Indices	Last	Change
STI	3033.81	-1.1%
HSI	20919.60	-0.1%
DJIA	13345.00	-0.9%
S&P 500	1432.56	-0.6%
Nasdaq	3051.78	-0.4%
China A50	7317.15	-0.2%

Corporate News

Corporate Announcements

STX OSV announced that Siem Offshore has declared options for the design and
construction of two additional Offshore Subsea Construction Vessels ("OSCV"). STX OSV already has two OSCVs under construction for the same customer in Norway, and two Platform Supply Vessels in Brazil.

Earnings release dates:
Fri 12 Oct: SPH (4Q12)
Wed 17 Oct: Ascendas REIT (2Q13)
Wed 17 Oct: Kepland (3Q12)
Thu 18 Oct: SGX (1Q13)
Thu 18 Oct: Keppel Corp (3Q12)
Fri 19 Oct: CapitaMall Trust (3Q12)
Tues 23 Oct: Mapletree Industrial Trust (2Q13)
Thu 25 Oct: NOL (3Q12)
Thu 25 Oct: CapitaCommercial Trust (3Q12)
Mon 5 Nov: SembCorp Marine (3Q12)
Wed 7 Nov: UOB (3Q12)
Wed 7 Nov: Biosensors (2Q13)
Thurs 8 Nov: Noble (3Q12)
Fri 9 Nov: SembCorp Industries (3Q12)
Fri 9 Nov: OCBC (3Q12)

Ex-dividend dates:
Tue 6 Nov: Olam ($0.05)