KLCI: +0.59% to 1795.1
JCI: +1.19% to 4652.4                                        SET: +1.87% to 1459.1
HSI: +1.21% to 22541.1                                     HSCEI: +2.59% to 10185.6
Nikkei: +2.57% to 13867                                    ASX200: +0.96% to 5157.7
S&P500: +0.28% to 1694.2                               Nifty: +1.55% to 5699.3


MARKET OUTLOOK:
In this week’s webinar, apart from giving the market outlook, we give an update on earnings, and call a Trading Buy on Iconix Brand Group – a US stock with growth potential and strong cash flows.

The webinar can be viewed from our archive at www.uniphillip.com > Education Programs > Phillip Securities Research Webinar

For our longer term outlook please see the latest Global Macro Asset Strategy report below.
 
(PhillipCFDs and ETFs for trading the market outlook can be found in the webinar slides above or the Global Macro report below. PhillipUT Wrap Account offers tactical asset allocation of unit trusts without front loading sales charge.)


Macro Data

Nil.

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Regional Market Focus

Singapore

• The benchmark STI closed higher at 3,244.12 (+0.37%). The 2.3bn shares traded were worth S$1.3bn in value.
• SingTel’s 1Q14 underlying results of S$897m was marginally better than expectations, excluding effects of the higher tax expense.
• We expect the STI to consolidate at current levels, with key near term support at 3,200 levels.
• Top picks for the year are Pan United (Buy, TP: S$1.21), SGX (Buy, TP: S$8.30) & Keppel Cord (Accumulate, TP: S$12.25).

Thailand

• Thai stocks rallied sharply on Tue in line with overseas markets on better-than-expected economic data out of China. The SET index successfully broke above a 1450-point resistance level before it finished the session at 1459.08 points.
• Overall bullish sentiment remains intact as macroeconomic data out of the US and Europe pointed to an improving recovery and confidence while earnings and interim dividend plays should continue to provide impetus for further upside.
• In our view, worrisome concerns that may re-escalate after the end of corporate earnings season include domestic political uncertainty and the timing of a possible QE tapering in the US. In the near term, sentiment remains under foreign selling pressure in both equities and derivatives markets. We expect a trading range of between 1440 and 1475 for the SET index today. Investors may raise equity exposure to 75% of the portfolio after a decisive breakout above 1450 points and book profits near a key resistance level of 1500 points.   
• Today we peg resistance for the SET index at 1475-1500 and support at 1450-1440.

Indonesia

• Indonesian stocks mostly rose Tuesday (13/08), on expectations that the central bank – Bank Indonesia – will maintain its benchmark rate at the monthly meeting on Thursday (15/08), and amidst mostly bullish markets in Asia. The Jakarta Composite Index (JCI) gained 54.617 points, or 1.19% on Tuesday, to finish at 4,652.397, after dipping below the 4,600 level a day earlier. All but one major industry sectors climbed on Tuesday, led by construction, property and real estate sector that surged 2.79%, followed by consumer goods sector with 2.42%-gain, and miscellaneous industry sector with 1.69%-rise. Agriculture sector became the only laggard on Tuesday, with 2.93%-drop. LQ45, the index tracking Indonesia’s blue-chip shares, gained 12.517 points, or 1.64%, to 776.465. Bank Indonesia (BI) on Thursday will hold its monthly board of governors meeting, and is widely expected to keep its benchmark rate at 6.50%. BI has raised both the benchmark rate and the overnight deposit facility rate, or Fasbi, by a total of 75 bps each to cool inflation expectations after subsidized fuel prices were raised in June, and to support the weakening Rupiah. Gainers outpaced losers 167 to 96 Tuesday on the Indonesia Stock Exchange, where 2.97 billion shares worth IDR 3.98 trillion changed hands on the regular board. Foreign investors’ transactions accumulated to a net sale of IDR 450.77 billion.
• The Jakarta Composite Index (JCI) will likely to extend climbs today, following higher closes on Wall Street overnight and with positive starts in Asia today. We expect the JCI to advance, with support and resistance at 4,579 and 4,689, respectively.

Sri Lanka

• The Market recovered to some extent from its bearish run prevailed on last few days as the indices geared to conclude in green terrain. The benchmark ASPI gathered 12.63 points or 0.21% to conclude at 6,142.87 and the S&P SL20 too closed positive gaining 1.78 points or 0.05% to settle the day at 3,453.23. On-board activity amounted to LKR 370.27Mn. Further on, the aggregated turnover for the day (LKR 403.03Mn) indicated a rise of 8.11% against the previously recorded. Under the sectorial review, Diversified Holdings (DIV) dominated the list, providing LKR 119.69Mn, while accounting to nearly 30% of the total turnover. Construction & Engineering (C&E) sector provided LKR 64.01Mn. As at the day’s close, the total market capitalization stood at LKR 2.36Tn, charting a year to date gain of 9.06%. The market PER & PBV stood at 16.26 and 2.18 respectively. During the day, a total of 23.56Mn shares changed hands, indicating an increase of 24.24% against the previous trading day. Price losers outstripped the price gainers by 94:83. Foreign participants appeared to bearish during the day having recorded inflows for the past four trading days. To result in a net foreign outflow of LKR 71.97Mn, resulted by foreign selling of LKR 136.41Mn and buying of LKR 64.45Mn; the year to date net foreign inflow currently stands at LKR 16.34Bn. The local FOREX market for the day closed with, the USD selling at LKR 133.19/- and buying LKR 129.99/-.

Australia

• The Australian share market on Tuesday hit a three month high, with investors buoyed by positive local earnings performances and potential stimulus measures in Japan. The benchmark S&P/ASX200 index was up 49 points, or 0.96 per cent to 5,157.7.
• Today (14/08/13), the Australian market looks set to open higher with international markets boosted by encouraging eurozone  data signalling that the 17-nation bloc may be edging out of recession.
• In economic news on Wednesday, the Australian Bureau of Statistics will release the wage price index for June quarter while the Westpac/Melbourne Institute Survey of Consumer Sentiment is also due out.
• In equities news, Commonwealth Bank, Southern Cross Austereo, CSL, Carsales.com, Goodman Fielder, WorleyParsons, Computershare and Primary Health Care are expected to post full year results. OZ Minerals and Leighton Holdings are slated to release first  half results full year results, while SingTel will announce first quarter results. Qantas chief executive Alan Joyce is due to speak at an American Chamber of Commerce in Australia lunch.

Hong Kong

• Exchange closed for the morning.

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Morning Note

Company Highlights

ISDN Holdings Limited has through its wholly owned subsidiary Aenergy Holdings Limited, entered into a sale and purchase agreement to acquire 80% equity stake in PT Charma Paluta Energy – a company incorporated in Indonesia with primary businesses in building, owning and operating hydroelectric plants and related businesses -- for US$450,000 from its equal and joint owners -- Mr Charles D Marpaung and Mr Sugiharto Sulaiman -- who each sold 144,000 shares to offer a total aggregate of 288,000 shares. PT Charma Paluta Energy has entered into a power purchase agreement with PT PLN, Indonesia's state-run power distribution company to build, own and operate a 4.6MW mini hydropower plant at Aek Sisira Tarabintang Sub-district, Humbang Hasundutan, North Sumatra province. The PPA states PT PLN will purchase the energy output at a tariff rate of IDR 787 or USD$0.08 per KWh for tenure of 20 years. (Closing Price S$1.105, - %)

SingTel has concluded the strategic review of the Optus Satellite business, which was initiated in March this year. Based on the review, SingTel is committed to growing and investing in the satellite business. (Closing Price S$3.820, 0.526%)

Heeton Holdings Limited unveiled its strategic growth targets for the next 3 years. The Group seeks to build significant growth momentum in both the Group’s Property Development and Investment Property segments to broaden its assets and earning bases as well as to further expand its business regionally. 1. Hospitality segment to propel the Group’s growth in its investment portfolio over the next 3 years. Main focus will be on growing the number of room keys to 1,500 by FY2016. 2. The Group’s future portfolio of investment will diversify to include other class of assets in both Singapore as well as across the region such as Indo-China 3. For development property, the Group will continue to invest in choice locations in Singapore which enables quick turnaround while actively seeking opportunities in the region. Similarly, the Group will be exploring to develop other asset class of properties, domestic and international. (Closing Price S$0.830, 2.469%)

Darco Water Technologies Limited announced that Malaysia-based subsidiaries of the Company, Darco Water Systems Sdn. Bhd. and Darco Industrial Water Sdn. Bhd., have recently secured numerous environmental engineering project orders from the industrial sector totalling to approximately MYR$12.1 million worth from around Malaysia for delivery in FY2013 and first half of FY2014. The most significant order comes from the semi-conductor manufacturing facility of Texas Instrument Malaysia in Ulu Klang and Melaka, which involves the upgrading of a 38m3/hr wastewater treatment plant. This contract has contributed an approximate MYR$6.0 million to the Order Book. (Closing Price S$ - , - %)