STI: +0.45% to 3210.2                         KLCI: +0.05% to 1803.6
JCI: -1.43% to 4512.7                         SET: +0.61% to 1457.4
HSI: -0.52% to 23315                          HSCEI: -0.14% to 10653
Nifty: -0.03% to 6202.8                        ASX200: +0.32% to 5390.4
Nikkei: +0.13% to 14713                    S&P500: +0.57% to 1754.7
      
MARKET OUTLOOK:
By Joshua Tan, Head of Research

Macro Data

China: House prices increased 9.1% on-year in September, its sharpest rise since January 2011, signalling concern that ample credit could fuel inflation. House prices in the country's largest cities continued to rise much faster than the national average, i.e. up by 16% in Beijing, 17% in Shanghai and about 20% in the southern cities of Guangzhou and Shenzhen, according to the data from National Bureau of Statistics.

The Leading Economic index from the Conference Board was up 0.9 in September from August’s 0.7. Meanwhile, the Coincident Economic Index, which measures current economic activity, increased 0.2% in September.

Malaysia: The seasonal adjusted unemployment rate in Malaysia increased for the second consecutive month in August, clocking at 3.2%, higher than 3% in July and 2.8% in August 2012, according to the Department of Statistics. The unemployment rate ticked higher to 3.1% in August from the previous month’s 3%.

USA: American employers added 148,000 jobs in September. The pace of employment growth was slower than the average rate annual rate of additions, which is 184,000 jobs per month. The unemployment rate ticked down to 7.2 from 7.3 percent the previous month, a change that was not statistically significant.
 

Regional Market Focus

Singapore

• Singapore stocks finished higher on Tuesday, with the benchmark Straits Times Index (STI) up 14.45 points, or 0.45 percent, to close at 3,210.21. The 3.09bn shares traded were worth S$1.46bn in value.
• The FTSE ST Mid Cap Index declined -0.13% while the FTSE ST Small Cap Index gained +0.44%. The top active stocks were Kep REIT (-3.25%), SingTel (+2.17%), Noble Grp (+2.43%), Wilmar (+2.99%) and LionGold (+8.48%).
• We peg key near term support at 3,100 levels.
• Top Picks are DBS (Accumulate, TP: S$17.50), SingTel (Accumulate, TP: S$3.99) and Keppel Corp (Accumulate, TP: S$12.07). Deep Value Plays are Amara (Buy, TP: S$0.74), Boustead (Buy, TP: S$1.94) and Courts (Buy, TP: S$1.03).

Thailand

• Thailand market is closed today for King Chulalongkorn Memorial Day Holiday.

• Indonesian stocks tumbled Tuesday (22/10) amid lower trade volume, and ahead of the US employment report for September scheduled for release later in the day. The Jakarta Composite Index (JCI) slid 65.435 points, or 1.43%, to settle at 4,512.743. The decline on Tuesday included all but one major industry group, with miscellaneous industry sector lost 3.05%, basic industry sector plunged 2.73%, and infrastructure sector declined 2.10%. Agriculture ended as the only sector in green on Tuesday with 2.07%-gain. The LQ45 index slipped 15.323 points, or 1.98%, to 758.427. 178 shares declined and 75 shares advanced Tuesday on the Indonesia Stock Exchange, where volume on the regular market was lower at 3.07 billion shares worth IDR 3.91 trillion. Foreign investors’ net sale amounted to IDR 1.1 trillion, a level not seen since end of August.
• The Jakarta Composite Index (JCI) will likely edge up today, following positive US non-farm payroll report, and as the Rupiah may gain strength against the US dollar. We expect the JCI to move higher today, with support and resistance at 4,463 and 4,584, respectively.

• The Witnessing yet another losing day, the Colombo bourse stretched further into the red terrain mainly due to the lackluster participation of the investors.  This triggered the ASPI to fall further, and to settle at its intraday low of 5,925.22 losing 21.43 points or 0.36%. The S&P SL20 ended the day at 3,272.58, dropping by 14.95 points or 0.45%. Foreign Investors appeared to be bullish during the day resulting in a net foreign inflow of LKR 226.99Mn being logged, adding further to the year to date net foreign inflow which amounts to LKR 22.76Bn. Foreign buying for the day amounted to LKR 492.30Mn and selling amounted to LKR 265.30Mn. The aggregate turnover for the day amounted to LKR 983.10Mn, indicating a dip of 6.08% against the previous trading day. Under the sectorial round-up, Diversified Holdings (DIV) sector provided LKR 359.04Mn (36.52% of the aggregated turnover), dominating the list and Bank Finance & Insurance (BFI) sector added LKR 272.27Mn. The daily traded volume amounted to 30.30Mn shares, indicating a drop of 8.82% against the previous trading day. Price losers smashed the price gainers by 108:69. As at the daily closure the total market capitalization reduced to LKR 2.46Tn, while reducing the year to date gain to 13.67%. With regard to the local FOREX, the USD currently selling at LKR 132.58/- and buying at LKR 129.32/-.

• Australia's share market rose to a fresh five-year high Tuesday as BHP Billiton jumped after a strong quarterly production report and improved iron-ore production guidance.  BHP could push the market higher in the short term after the world's biggest miner raised its fiscal 2014 iron ore production guidance 2.4% to 212 million metric tons. BHP's iron-ore output rose 2% to 48.8 million tons over the previous quarter and 23% on year, stronger than some analysts expected.
• The benchmark S&P/ASX 200 closed up 0.4% at 5373.1 after rising to 5380.4, its highest point since June 2008. It was the sixth-consecutive rise in the index, its longest winning streak since Aug. 2. Share trading value rose to 4.5 billion Australian dollars (US$4.3 billion), but remained below the recent average of about A$5 billion.
• Australian shares are up 3.0% this month, primarily driven by expectations of sustained quantitative easing from the U.S. Federal Reserve. A recent U.S. government shutdown is projected to have trimmed economic growth and the country faces another bout of uncertainty over its debt ceiling in February.

• HSI dropped 122 points or 0.52% to 23,315. CEI lost 14 points to 10,653. Trading volume declined to HKD58.938 billion.
• China Mobile (941.HK) dropped 3.4% after 3Q13 results missed analyst’s estimate and led HSI down. 
• China power sector out-performed with China Res Power (836.HK) and Huaneng Power (902.HK) gained 3.9% and 5.7% respectively.
• Macau Gambling sector under-performed after surge in previous trading days. Galaxy Ent (27.HK), Sands China Ltd (1928.HK) and SJM Holdings (880.HK) lost 4.5-6.6%.
• CSR (1766.HK) gained 4.6% after signing several contracts. China Rail Cons (1186.HK) and China Railway (390.HK) gained 2.7% and 1.9% respectively.
• Technically, the next resistance and support for HSI are 23,554 and 23,000 respectively.

Morning Note
Company Highlights

Sino Grandness Food Industry has entered into a Cooperation Agreement with Guzhen Municipal Government of Anhui Province to invest RMB 600 million to construct a new production plant in people’s Republic of China. (Closing Price: S$0.735, 1.38 %)

Source: PhillipCapital Research - 23 Oct 2013