Stocks should start the session with follow through gains from the past 2 session on the back of the overnight rally on Wall Street. US lawmakers worked towards a proposal to delay the government exceeding the debt limit to Nov 22 from Oct 17. However, the federal government shutdown continues. This eases the imminent danger of a US debt default, providing a respite but does not remove it altogether. In the near-term, it allows investors to refocus back to the 3Q earnings season.

We were right to point out that STI on dip below 3150 towards c.3100 offered bargain hunting opportunities. In the immediate term, a rise above 3200 should see resistance increasing towards 3250 as the index moves closer towards its 13.9x (ave) 12-mth forward PE at slightly above 3250. Investors will still rein in their enthusiasm unless the anticipated lack luster 3Q earnings season shows it can surprise on the upside. That it, it's still pretty much 3150-3250 in the near-term, little different from what we said back on September 19.

Malaysia's Sep13 palm oil output rose by 10% m-o-m to 1.912m MT or 4% below forecast. Although FFB yields continued to sequentially recover, the pace was slower than expected. The higher palm oil supply was partly offset by a 5% m-o-m increase in exports to 1.605m MT; given jumps in shipments to India, Pakistan and Bangladesh, which more than made up for lower shipments to China, EU-27 and Iran. At the end of Sep13, palm oil inventories in Malaysia consequently rose 7% mo-m to 1.784m MT - or 2% below forecast. Planters are due to report sequential earnings recovery. Despite lower prospective palm oil prices in the near-term, we expect most planters' 2H13 earnings to rebound (vis-à-vis 1H13) - premised on seasonally higher CPO sales volumes and lower unit costs. For SGX-listed planters, we recommend accumulating Bumitama Agri, First Resources, and Indofood Agri, for better expected returns.

Keppel Corp has won a contract from Perforadora Central to build a KFELS B Class jackup rig worth US$240m, including owner furnished equipment. Scheduled for delivery in 4Q 2015, the jackup rig is intended for operations in offshore Mexico. The latest contract is the fifth orders from the repeat Mexican customer, Perforadora Central, since 2002. Keppel O&M has emerged to be the leading rig provider to the Mexican market, with a total of 20 projects delivered or on order for Mexico, of which 15 are of Keppel's proprietary KFELS B Class design. This brings Keppel Corp's YTD order wins to S$5.3bn, making up 89% of our FY13 assumption of S$6bn. If the orders for six jackup rigs (part of the MOU with PEMEX to jointly develop yard facility in Mexico) are effective before year end, it could add c.S$1.6bn, blowing past our order win assumption. Keppel's strengthening of footprint in the growing Mexico market reinforces its near market, near customer strategy, proven track record and excellent product quality. Maintain BUY and TP of S$12.90.

Tiger Airways operating statistics for the month of September 2013. Tigerair Singapore recorded a 20.9% (y-o-y) increase in traffic to 711 million revenue passenger-kilometres (RPK), while capacity increased 23.3% to 917 million available seatkilometres (ASK). Consequently, y-o-y passenger load factor was 1.5 percentage points lower at 77.5%. For the 12 months to September 2013, Tigerair Singapore recorded a 24.9% increase in traffic to 8.8 billion RPK, surpassing the 22.2% increase in capacity to 10.7 billion ASK. Consequently, passenger load factor was 1.7 percentage points higher at 82.9%. The number of passengers carried grew 20.0% to 4.8 million, compared to 4.0 million in the previous period.

The recent volatility in its share price has caused gold miner LionGold Corp to call off talks over a potential offer for Minera IRL, a Latin American precious metals mining company. Negotiations end without any liability to each other. Chinese Premier Li Keqiang has said that China's economic growth probably exceeded 7.5% in the first nine months of the year. The National Bureau of Statistics will report third quarter growth on Oct 18. The market is expecting 7.8% growth, up from the second quarter's 7.5%.

US markets surged with the Dow paring more than a third of its recent decline after lawmakers moved toward an agreement to increase the debt ceiling. Investors reacted to a House Republican proposal for a short-term increase in the debt ceiling that would reduce the prospects for a U.S. default. The plan postpones the lapse of U.S. borrowing authority to Nov. 22 from Oct. 17. However, the till date 10-day-old partial shutdown of the federal government continues. Meanwhile, weekly jobless claims (actual 374k, consensus 308k) jumped to the highest level in 6 months, providing the first statistical warning about the impact of the government shutdown.

Source: DBSV