STI should stay firm this week. We maintain our view for the index to head towards 3200 in 4Q. The immediate support is at the 3035-3070 gap while the immediate resistance around 3100. With the global economy still in a weak state this quarter, we do not rule out a pause to the current STI's rise around mid-Oct as the 3Q results season draws close.

Besides the O&M, commodities, supply chain managers and fiscal stimulus beneficiaries, residential property stocks have also benefited from the FED's QE3 that is likely to suppress interest rates till mid-2015 while inflation concern stays elevated. We pick Wing Tai, Capitaland and Bukit Sembawang. As property stocks have risen in recent weeks with most fast closing in on their respective target prices, we advocate a buy-on-pullback.

Investors' hunt for yield will also likely continue with the extended low interest rates environment and uncertain global economic outlook. Our picks among the S-REITs are Suntec REIT, Fraser Commercial Trust and Fraser Centrepoint Trust.

More positive newsflow from the O&M sector. Petrobras said will contract 15 production platforms by 2017. It is currently evaluating potential shipyards able to meet the orders' requirements. The awarding of the contracts will start still in November this year. This should benefit Keppel Corp and SembCorp Marine.

Dyna-Mac Holdingshas secured three new fabrication orders for a provisional sum of US$42m. These orders are expected to have a positive contribution to Dyna-Mac's EPS for FY Dec 2012.

Gul Techannounced that Greenwich Pacific, ultimately owned by a member of the Liem family that runs Tuan Sing Holdings, has submitted a formal proposal seeking Gul Tech's voluntary delisting, with an exit cash offer of $0.162 per share. This represents a premium of approximately 38.5% over Gul Tech's last transacted price.

First Real Estate Investment Trust is acquiring two hotel and hospital properties in Indonesia for $143m. First Reit will buy the Siloam Hospitals Manado and Hotel Aryaduta Manado, an integrated hospital and hotel development in North Sulawesi, for $83.6m, or a 10.8% discount to the average of two independent valuations. The development has 224 hospital beds and 200 hotel rooms. The Reit will also purchase the 416-bed Siloam Hospitals Makassar in South Sulawesi for $59.3m, or a 9.8% discount to valuation.

Hai Leck Holdingsis proposing to undertake a renounceable non-underwritten rights issue of up to 81.1m warrants, at an issue price of S$0.05 for each Warrant, each Warrant carrying the right to subscribe for one (1) new share at an exercise price of S$0.13, on the basis of one (1) Warrant for every four (4) existing Shares held. The company intends to use the net proceeds of about S$3.9m to finance the Group's business expansion and to enlarge the general working capital of the Group.

More Tianjin companies could be listed on the Singapore Exchange (SGX), following the bourse's latest deal to deepen ties with the Chinese city. SGX had signed a memorandum of understanding (MOU) with Tianjin People's Government State-owned Assets Supervision and Administration Commission. Under the MOU, both parties will work together on the exchange of information to encourage more Tianjin enterprises to list on SGX. Currently, there are four Tianjin companies listed here.

In property news, a prime "white" site at Thomson Road/Irrawaddy Road has been triggered for sale by public tender after a developer offered a bid of at least $211.3m, or $700 psf ppr. It is classified as a "white" site, which means it can be put to commercial, residential or hotel use. But the Urban Redevelopment Authority (URA) requires that a minimum 30 per cent of maximum permissible gross floor area (GFA) be set aside for hotel use. It has a plot area of 0.66 ha, which translates to a maximum permissible GFA of 301,852 sq ft.

World trade will grow by a mere 2.5% this year, dragged down by Europe, to less than half of the previous 20-year average, the World Trade Organization (WTO) said. The WTO cut its estimate from a 2012 growth forecast of 3.7% it made in April and also lowered its forecast for 2013 to 4.5% growth from 5.6%.

Source: DBSV