The near-term choppy trend continues for the STI with the current session likely an up day after US markets finished higher ahead of a national holiday and June's ADP employment number (actual 188k, consensus 160k) came in better than expected. 

In Europe, bond yields for Portugal rose on news that the country's Foreign Affairs Minister resigned. Reaction was limited to Portugal with bond yields of the other Eurozone nations of Spain and Italy little changed. In Egypt, the military has ousted the country's President from power. Political uncertain remains. Oil price is just marginally higher on this news with Brent crude currently at USD101.39pbl (+0.16) following gains in the past 3 sessions.

Keppel Corp has secured a contract to build a jack rig for PV Drilling Overseas (PVDO), based on its proprietary KFELS B class design. This will be the 19th KFELS B Class rig on order at Keppel, with 45 already delivered since 2000. The contract value of US$210m represents a 2.4% premium over the last contract for similar rig with Grupo in March, due to the fast track delivery of 21 months by 1Q 2015. The new order brings Keppel's YTD win to S$3.4bn, making up 57% of our full year assumption of S$6bn. No change to our earnings; maintain BUY and TP S$13.00.

Singapore's PMI reading rose to 51.7 in June from 51.1 in May, expanded for the fourth straight month. The improved showing last month stands in contrast to PMIs elsewhere in Asia, including China. The increase comes on the back of new orders and new export orders, which continue to expand, but at a slower pace. New orders were down 0.5 in June to 52.6, while new export orders were down 1.4 to 51.5. The overall inventory index, which continued to expand for the second consecutive month, has recorded the highest reading since December 2011. Singapore's electronics sector expanded for the fifth consecutive month in June, but at a slower pace, dropping 0.2 to 51.2.

Midas has secured a RMB44.3m metro contract, awarded by CNR Changchun Railway Vehicles for Changchun Metro Lines 1 and 2. Under the terms of the contract, Jilin Midas will supply aluminium alloy extrusion profiles for 44 train sets, or 264 train cars. Delivery is expected to take place from this year to 2015. The latest contract adds to the several rail contracts won by the group in the current quarter in China and Singapore. Maintain BUY, TP S$0.60 based on 1.2x P/B.

Parkway Life Reitis building up its Japanese portfolio with the purchase of yet another two nursing homes for $23.1m. Colliers International had valued the properties Palmary Inn Shin-Kobe in Hyogo at $18m and Heart Life Toyonaka in Osaka at $6m, as at April 15. The two homes have an average occupancy rate of 85%, as at June 19. PLife Reit expects to generate a net property yield of 7.1% with the two buys.

ST Aerospace, the aerospace arm of ST Engineering, has inked a long-term agreement with UTC Aerospace Systems to provide maintenance, repair and overhaul (MRO) services for the nacelle systems of the Rolls-Royce Trent 1000 and General Electric GEnx engines used in Boeing's Dreamliner.

Intraco'smandatory conditional cash offer for its listed associated company Dynamic Colours has lapsed, as it did not have enough acceptances to make its offer unconditional. The cash offer of 18.5 cents per share for Dynamic Colours was conditional on Intraco and its concert parties holding more than 50% of the voting rights for DCL's shares by 5.30pm on Tuesday.

Despite the ongoing challenges facing the global economy, demand for air travel continues to grow robustly, underpinned by emerging markets. According to the International Air Transport Association (Iata), global passenger traffic for May grew by 5.6% y-o-y, outstripping the 5.2% increase in capacity. This caused load factor to inch up 0.3 percentage point to 78.1%. In April, passenger traffic was up 3.2% y-o-y. For the first five months of the year, passenger demand was 4.3% higher y-o-y, while capacity was 3.4% higher and load factor stood at 78.4%.

Source: DBSV