Warrants Highlight

Chinese stocks rally on China export data

Chinese trade figures, a happy surprise
Most asian stocks climbed after China’s December export data beat expectations yesterday. Economists estimated a 5% gain in exports year on year (yoy) but actual exports surged 14.1% yoy. Imports unexpectedly increased 6% yoy. This translates to a $31.6 billion trade surplus for the world’s second largest economy, well above estimates of $20 billion.

Shipments to the European Union (EU) rose 2.3% in December and were the first gain since May. Additionally, demand from the US, Canada, South Korea and India also increased. Head of custom statics, Zheng Yuesheng said at a press briefing that “the US had replaced the EU last year as China’s largest export market” and based on the customs data showed, both the US and the EU contributed to a third of China’s exports in 2012.

In the whole of 2012, China exports rose 7.9% while imports increased 4.3%, missing the government’s target of 10% growth in combined trade.

2013 trade data expected to be better
China’s Ministry of Commerce, which oversees trade policies said in a statement that it will seek to stabilize the scale of exports and improve support for trade growth in 2013. Commerce Minister Chen Deming is optimistic about next year’s trade data, saying that 2013 will be “slightly better” than 2012. The nation’s leaders are targetting trade growth of about 8% in 2013. (Bloomberg)

Many Chinese counters in Singapore did exceptionally well yesterday, adding the most percentage gains for the day. Yangzijiang (+5.4%, $1.08), Cosco (+3.1%, $0.985) and CapitaLand (+2.1%, $3.94).

CPI in focus today
This morning, China is due to announce its December’s consumer price index (CPI) and producer price index (PPI) at 9.30a.m. Economists are expecting CPI to grow 2.3% yoy and PPI to fall by 1.8% yoy.

According to the International Business Times, the jump in CPI is likely to be attributed to food prices. The Ministry of Finance previously reported that agricultural wholesale prices rose nearly 6% month on month in December, which is high when taking into account of the usual seasonal pattern. Food prices account for almost one third of the weighting in the country’s CPI calculation.

Singapore Market Wrap

China trade surplus boost Asian markets

China's December trade balance jumped 61.2% month-on-month to US$31.6 billion, with exports growing 14% year-on-year. The better than expected China data boosted Asian markets with the STI climbing 0.2% to 3,226.3.

Call STI 3250MBeCW130430 (R5XW) exercise level 3,250.*
Put STI 3100MBePW130430 (R5WW) exercise level 3,100.*

MAS issued new guidelines on short-selling disclosure
Following SGX's recent announcement of improved transparency concerning the tagging of securities orders of short selling, the MAS said that it will be issuing new guidelines to ensure that short selling activities will be accurately disclosed. Although this implementation would enhanced market transparency, the MAS indicated that the disclosure should still be interpreted with care. SGX remained flat at $7.11 for the trading session.

Call SGX MB eCW130502 (RE5W) exercise price $7.20.*
Put SGX MB ePW130503 (R8RW) exercise price $ 7.20.*

NOL jumped 7.3%
With a volume of roughly 46 million shares, NOL ranked among the top 20 on SGX's website yesterday. It spiked 7.2% to close at $1.335 with volume increasing 83.2% day-on-day. The closing price was also it's highest since April 2012 with the share price already gained 9.6% year-to-date.

Call NOL MB eCW130604 (Q8FW) exercise price $1.30.*

Overnight Market Wrap

Will S&P cross 1,500?

The S&P returned to a five-year high after gaining 0.8% yesterday. This was despite more people filing for unemployment last week with jobless claims increasing 4,000 to reach 371,000.

Bloomberg quoted Tom DeMark who forecasts a 5.5% pullback in the S&P 500 index when it reaches an intraday high of 1,492.73. He mentioned that "1492.73 is just shy of psychological level of 1,500 as most traders are predisposed to look at markets in round numbers and will expect 1,500 to be hit. And just to confound them, he expects market to trade not quite to 1,500".

In Europe, the European Central Bank had a unanimous decision to keep interest rate unchanged. President Mario Draghi said that the euro-area economy will slowly return to health and stocks started to do better after his statement. Yet, the Stoxx Europe 600 failed to close higher, falling 0.3% day on day.

Overnight Markets

Corporate News

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Earnings release dates:
Mon 14 Jan: SPH (1Q13)
Tue 15 Jan: AREIT (3Q13)
Fri 18 Jan: CapitaMall Trust (FY12)
Tue 22 Jan: MapleTree Industrial Trust (3Q13)
Tue 22 Jan: SGX (2Q13)
Wed 23 Jan: Keppel Land (FY12)
Wed 23 Jan: CapitaCommercial Trust (FY12)
Thurs 24 Jan: Keppel Corp (FY12)
Wed 6 Feb: DBS (FY12)
Wed 6 Feb: GLP (3Q13)
Thurs 28 Feb: Noble (FY12)