STI: -0.02% to 3113.6                            KLCI: +0.82% to 1841.9
JCI: +0.80% to 4214.3                           SET: +0.43% to 1367.4
HSI: +0.29% to 23811                            HSCEI: +0.50% to 11432
Nifty: +1.66% to 6363.9                         ASX200: -0.80% to 5144.4
Nikkei: +2.29% to 15650                        S&P500: +0.18% to 1808.4


MARKET OUTLOOK:

Macro Data

Eurozone:
German industrial output, adjusted for seasonal swings, decreased 1.2 percent from September, when it fell a revised 0.7 percent. Economists predicted a gain of 0.7 percent, according to the median of 38 estimates. Production climbed 1 percent from a year earlier when adjusted for working days.

China:
China’s trade surplus widened last month to the largest in more than four years as exports exceeded estimates, in a sign global demand is helping sustain a recovery in the world’s second-biggest economy. The surplus was $33.8 billion as outbound shipments rose 12.7 percent from a year earlier and imports gained 5.3 percent.

Inflation slowed in November as the consumer price index (CPI) rose to 3 percent y-o-y from October's reading of 3.2 percent, well below the official 3.5 percent target for 2013. Therefore giving the government plenty of headroom to maneuver their policy to push ahead with its slate of financial reforms. On monthly basis, CPI fell into negative territory at -0.1 percent from 0.1 percent in the preceding month.

Deflationary pressures continued to weigh on producer prices -- mainly due to weak commodity prices. Producer prices slipped 1.4 percent y-o-y, albeit a slight improvement from October’s 1.5 percent decline.

Japan:
Gross domestic product expanded an annualized 1.1 percent from the previous quarter, a revision from 1.9 percent, the Cabinet Office said today in Tokyo. The shortfall in the broadest gauge of trade was 128 billion yen ($1.2 billion), the Finance Ministry said. Only four of 23 economists surveyed by Bloomberg News forecast a deficit.
 

Regional Market Focus

Singapore

• The Straits Times Index (STI) ended 0.53 points lower or -0.02% to 3,113.64, taking the year-to-date performance to -1.69%.
• The FTSE ST Mid Cap Index gained +0.11% while the FTSE ST Small Cap Index gained +0.29%. The top active stocks were SingTel (+0.28%), DBS (-0.36%), Genting Hong Kong (-3.37%), Vallianz (+2.44).
• STI has been drifting sideways over the past 2 months due to a lack of catalysts with recent weakness.
• We peg near term support at the 3050 level.
• Top Picks are DBS (Accumulate, TP: $17.50), M1 (Accumulate, TP:$3.55), Boustead (Buy, TP: $2.05) and Keppel Corp (Accumulate, TP:$12.07). Deep Value Plays are Amara (Buy, TP $0.74).

Thailand

• Holiday

• Most Indonesian stocks rose on Monday (09/12), as investors responded positively to upbeat employment data in the US released Friday (06/12). The Jakarta Composite Index (JCI) climbed 33.554 points, or 0.80%, to finish at 4,214.342. The LQ45 index advanced 8.796 points, or 1.27%, to 699.821.
• Gains on Monday were supported by seven of the nine major industry sectors, led by miscellaneous industry sector with 1.97%-climb, trailed by consumer goods sector with 1.39%-gain, and finance sector with 1.20%-advance. On the downside, construction sector slid 0.40% and trade, services and investment sector declined 0.11%.
• Gainers outpaced decliners 122 to 106 Monday on the Indonesia Stock Exchange, where 2.77 billion shares with a total value of IDR 3.34 trillion traded on the regular market. Foreign investors’ transactions netted in a total stock purchase of IDR 92.87 billion.
• The Jakarta Composite Index (JCI) may consolidate today, amidst lack of momentum from global markets and following the advance a day earlier. We expect the JCI to move sideways today, within 4,176 – 4,246 range.

• The Colombo bourse ended the day on a positive note, adding further to the gains recorded during the previous trading day.  The ASPI extended gains for the second consecutive trading day and settled the day at 5,821.30 with a gain of 11.06 points or 0.19%. The S&P SL20 gained 11.21 points or 0.35% to close the day at 3,194.30. With regard to movement in share prices, a total of 80 companies gained during the day whereas 87 companies posted drops in share prices. As at the daily closure the total market capitalization stood at LKR 2.42Tn, charting a year to date gain of 11.73%. The market PER and PBV were 15.06x & 1.97x respectively. The turnover for the day amounted to record LKR 332.30Mn, indicating a drop of 57.39% from its previously recorded. Under the sectorial round-up, Diversified Holdings (DIV) sector topped the list providing LKR 130.38Mn and Bank Finance & Insurance (BFI) sector stood next in line providing LKR 82.51Mn to the daily aggregate turnover. A total of 9.10Mn shares changed hands during the day resulting in a drop of 87.75% compared to the previous trading day; this was the second lowest volume traded during the year. Foreign participants opened the week on a bearish note, resulting in a net foreign outflow of LKR 22.74Mn having recorded inflows for the past three trading days. Foreign selling amounted to LKR 98.84Mn and buying were recorded as LKR 76.10Mn. Currently, the year to date net foreign inflow stands at LKR 22.90Bn.  Looking at the local FOREX market, the USD is selling at 132.40/- and is buying at LKR 129.24/-.

• The Australian share market on Monday lost ground as insurance giant QBE's losses weighed on the financial sector. The benchmark S&P/ASX200 index dropped 41.6 points, or 0.8 per cent, to 5,144.4.
• Today (10/12/13), the Australian market looks set to open flat following rises on international markets after surprisingly strong US jobs figures.  QBE shares fell more than 22 per cent after the company said it expects to post a $250 million loss for calendar 2013 because of weakness in the North American market.
• In economic news on Tuesday, the Australian Bureau of Statistics releases its October housing finance data and the National Australia Bank its monthly business survey for November.
• In equities news, former Brambles division Recall is expected to list on the ASX, Woodside Petroleum has an investor update scheduled while Billabong International holds its annual general meeting on the Gold Coast.

• HSI climbed 68 points and CEI gained 56 points. Trading volume was low at HKD53.992 billion.
• HK market was firmer on better-than-expected US job data and Chinese exports. HSI opened at 23,970 (+226), but was already the day high.
• Macau gambling stocks out-performed as government said no intention to add more licenses. SJM Holdings (880.HK), AMAX Int Hold (959.HK) and Dynam Japan (6889.HK) surged 2.4%, 10.9% and 19% respectively.
• Tencent (700.HK) rose 0.5% after hitting intra-day high of HK$480 on news that it secured broadcasting rights for 2014 World Cup and Winter Olympics.
• Haier Elec (1169.HK) surged 13.1%, reaching 14-year high on introduction of Alibaba as strategic investor.
• New energy sector out-performed with China Windpower (182.HK) and JNCEC (579.HK) climbed 8.7% and 5% respectively.
• Technically, we remain biased that HSI will be range bounded between 23,500 and 24,000. The next resistance and support for HSI are 24,000 and 23,519 respectively.

Morning Note
Company Highlights

CapitaLand Limited announced it has bought back an aggregate of 2 million shares of CapitaLand in an on-market share buyback exercise on the Singapore Exchange Securities Trading Limited on 6 December 2013 pursuant to the Share Buyback Mandate approved by shareholders at the Extraordinary General Meeting of CapitaLand held on 26 April 2013. The Shares were bought back at the weighted average price of S$3.0037 per Share. (Closing price: S$3.01, -1.0%)

Cordlife Group Limited announced that the Company has acquired a further 11.89 per cent interest in StemLife Berhad, an associated company of Cordlife which is listed on the ACE Market of the Malaysian stock exchange, for a sum of RM17.66 million (S$6.83 million). Following the additional acquisition, Cordlife will hold approximately 31.81 per cent of the issued and paid-up share capital in StemLife. (Closing price: S$1.205, -0.4%)

IPC Corporation Limited announced that its Sapporo Hotel is renamed to nest HOTEL sapporo odori with effect from 9th December 2013. This is the fourth of nine hotels owned by IPC in Japan to be renamed using its nest brand. (Closing price: S$0.151, -%)

Source: PhillipCapital Research - 10 Dec 2013