US markets powered higher driven by corporate earnings that offset a weaker-than-expected January consumer confidence number (actual 58.6, consensus 64). In after hours, Amazon continued the positive earnings trend. The Dow and S&P had already made post-GFC high recently and are now just 2-4% from their all-time high. Many Asian indices including STI have not even made a post-GFC high. For the STI, the post-GFC high occurred on 9 Nov11 at 3313. Besides sustained liquidity, the start of an earnings recovery trend is the other key factor that will decide whether STI has more upside to go despite the 330pt rally since mid-Nov last year. Investors need to see an end to 7 quarters of earnings downgrade trend (i.e. earnings upgrade) before more confidence sets in. We hope to get a better idea as the current reporting season progresses.

Singapore's current corporate earnings season has been much centred on the REITs so far but things start to speed up next wk. Banks start their earnings release. ASL Marine, Biosensors, SIA, Capitamalls Asia and Amtek Engineering reports next week as well.

The government released its White Paper on Population yesterday. It is estimated that Singapore's population could grow an estimated 30% from the current 5.3 mln to reach 6.5-6.9 mln by 2030. This comprises a resident population of 4.2-4.4 mln, of which 3.6-3.8 mln are citizens and the remainder, permanent residents (PRs). The non-resident group will number about 2.3-2.5 mln. The government has also set aside land for 700,000 additional homes, roughly translates into about 39,000 units a year. The White Paper acknowledged that Singapore had fallen behind in its planning and investment for infrastructure development, and accordingly discussed other improvements, such as a better and more extensive transport system. The construction, transport and healthcare sectors will be potential beneficiaries.

In terms of GDP growth, moderation will be the key for the economy going forward. No longer will growth targets be set at 5-6% a year. Instead, it is estimated that GDP could grow at 3-5% a year between now and 2020. Beyond that, from 2020 to 2030, growth could be an even more modest 2-3% a year, the paper estimates.

The workforce growth will also be more controlled. It has been expanding at a rate of 3.3% a year for the past 30 years. But from now to 2020, the paper estimates that it will grow at just 1-2% a year. From 2020 to 2030, it will taper off further and grow at just one per cent a year.

3Q13 results for SMRTwere below expectations on higher staff, repair and maintenance costs. We expect earnings to worsen and have cut FY13F/FY14F earnings by 16%/25% as we factor in further cost increases. Maintain FULLY VALUED with reduced TP of S$1.30 (Prev S$ 1.50).

SingTel has entered into an agreement for the sale of its entire 30% stake in Pakistan's Warid Telecom. SingTel is to receive an aggregate consideration comprising US$150mn and a right to receive a 7.5% share of the net proceeds from any future sale, public offering or merger of Warid. The estimated loss on disposal will be approximately S$230m, including the foreign currency translation losses and transaction cost. In our view, disposing off an under-performing asset is positive. Warid has been a drag on SingTel's earnings ever since acquisition, impacting SingTel's bottomline by ~1% annually. However, SingTel's core markets are not out of the woods yet. Maintain HOLD, TP: S$ 3.25.

Indofood Agri Resources is acquiring a 50% interest in Companhia Mineira de Açúcar e Álcool Participações (CMAA). The proposed acquisition, which is earnings accretive in FY14F, will cost c.US$71.7m, fully funded by internal cash. This is a positive move but no change to our HOLD call; TP of S$ 1.26 and forecast, pending completion. When completed, this purchase signifies IndoAgri's first step to diversify earnings internationally.

Biosensors has received CE Mark approval for its new generation stent BioFreedom. The plan is to trial launch BioFreedom in selected markets during 2013 before full commercial launch expected in 2014. The approval puts Biosensors another step ahead of the competition but impact to financials is minimal since the launch is expected to be in phases. We are more positive on Biosensors' potential acquisition which may be announced soon, after it raised S$300m in fixed rate notes last week. Maintain BUY, TP: S$1.41.

Magnus Energy Groupexpects to report a higher profit for the six months ended 31 December 2012 as compared to the previous corresponding period, mainly due to positive contributions from operations resulting in higher revenue and gross margin, and gain on disposal of assets.

Mermaid Maritimehas been awarded a series of contracts from existing clients for the provision of subsea services to support offshore oil and gas fields in the Gulf of Thailand, Sakhalin and Qatar. The combined value of these contract awards is approximately US$30m.

In property news, a 99-year private condo plot about 450 metres from the Lakeside MRT station attracted 12 bids yesterday, in an indication that developers' interest in prime suburban sites may not have been curbed by the round of property-cooling measures unveiled this month. MCL Land's top bid of $651.33 psf ppr was 3.3% above the second highest bid of $630.57 psf ppr from the UOL Group. The top six bids were within a 10% range.

Source: DBSV