Singapore's manufacturing activity contracted for a third straight month in September, as new export orders declined. The purchasing managers' index was 48.7 in September, contracting further from August's reading of 49.1. New export orders shrank after expanding in each of the previous three months, while total new orders fell to their lowest level year-to-date. Electronics sector also slowed to 50.0, from 50.7 in August, as new orders declined and employment slumped. But stocks of finished electronics goods bounced back from an August contraction to record 55.7 in September. Our economist says Singapore will likely enter technical recession in 3Q, the first since 2008/09. He expects GDP to contract by 1.0% (QoQ, saar) in 3Q12 and cuts 2012 GDP to 1.8% from 2.5% and that for 2013 to 3.2% from 3.7%.

DBSV Research is upgrading Singapore Exchange to HOLD from Fully Valued. We expect a gradual resurgence in trading activity. 3QCY12 should see a pick up in trading activity but 4Q is typically a slower quarter, particularly in Dec. Our analyst has raised securities average daily trading volumes and values to 1.68bn and S$1.43bn respectively (from 1.57bn, S$1.34bn), lifting FY13-14F earnings by 4% each. With trading activity expected to pick up and following earnings revision inclusive of a minimum cash value per share to 47 Scts, target price is raised to S$7.25 (Prev S$ 5.40). The 1Q13 results to be released on 18 Oct is expected to be strong. Our analyst forecasts 1QFY13 net profit of S$78m on S$172m revenues and S$74m expenses. Base DPS of 4 Scts should be declared as usual.

STX OSV has secured an order for a cable laying vessel from an undisclosed international client worth in excess of NOK450m (>US$79m). Delivery is scheduled in 3Q 2014. This order brings STX OSV's FY12 YTD order wins to c. NOK8.1bn, on track to meet our full year assumption of NOK10.0bn. Maintain BUY, TP S$2.00. Notwithstanding the overhanging macro uncertainties and Euro worries, the underlying fundamentals in the O&M sector remains intact. Enquiry levels for subsea construction vessels remain active; we believe STX OSV could secure 1-2 units by year end.

Keppel Corp is in talks with Malaysian Petronas to invest in a new gas-fired power plant in Johor, southern Malaysia, according to a report in The Straits Times. The deal would be the first investment involving a Singapore firm in Malaysia's power sector, which is dominated by domestic companies, according to the report. Keppel could buy a 30% stake in the 1,200 megawatt plant, part of a much larger petroleum and petrochemical project earmarked for Pengerang at the tip of Johor state, it said.

Ezra's proposed spin-off of its subsidiary, Triyards Holdings, via a 1-for-10 dividend in specie, will trade ex-dividend on Tuesday, 9 Oct 2012. Expected date for crediting Triyards shares into securities accounts of entitled depositors will be on Wednesday, 17 Oct 2012. Triyards shares will commence trading on Thursday, 18 Oct 2012.

Broadway's proposed acquisition of 70% stake in Millennium Arena Sdn Bhd has lapsed due to non-satisfaction of certain conditions, including consent to the proposed acquisition from a third party which Millennium Arena has entered into a contract.

Olam Internationalis offering to purchase the remaining 14.07% stake it does not own in NZ Farming Systems Uruguay, for NZ$25.8m (S$26.4m) or 75 New Zealand cents per share. Olam planned to delist NZ Farming once it hits its target of a full takeover. NZ Farming develops and operates dairy farms in Uruguay. Its shares, listed on the New Zealand stock exchange, were last traded at 70 New Zealand cents on Sept 27.

Two years after its foray into oil & gas exploration and production, Loyz Energy (former sanitary ware maker Sim Siang Choon) is divesting its entire sanitary ware business, to the group's chairman, Sim Siang Choon, for $9m. It will use the proceeds as working capital to help fund ongoing projects and pursue future E&P opportunities.

Source: DBSV