Reuters: Hot Stocks: STOCKS NEWS SINGAPORE-CIMB downgrades container shipping sector

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STOCKS NEWS SINGAPORE-CIMB downgrades container shipping sector May 14th 2012, 06:14 Mon May 14, 2012 2:14am EDT CIMB Research downgraded the regional container shipping sector to neutral from trading buy after a transPacific rate hike expected on May 1 did not happen and spot rates began to fall. CIMB lowered its rating on Neptune Orient Lines Ltd , Orient Overseas (International) Ltd and SITC International Holdings Co Ltd to neutral. Last week, NOL and SITC shares lost more than 12 percent each, while Orient stock fell 16 percent. "Investor confidence in container shipping crumbled for the first time last week, after 4-5 months of upward momentum. This triggered the brutal wave of selling," CIMB said. Although carriers are still pushing for more rate increases, customers are beginning to resist and capacity is returning in a weak demand environment, CIMB said. "As a result, share prices could retain a downward bias in the next two months." But share prices are expected to rebound eventually as second-half earnings are seen to be positive, CIMB said, adding that it does not expect a return to the deep losses in 2011. For a related story, click 1356 (0556 GMT) (Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com) ************************************************************ 12:45 STOCKS NEWS SINGAPORE-Shares march higher at midday Singapore shares marched higher at midday, buoyed by news China took steps to spur growth, but gains were limited by the failure of weekend talks to form a new Greek government. The benchmark Straits Times Index (STI) was 0.4 percent higher at 2,894.77. There were 148 gainers on the stock exchange and 194 losers, with 154 securities unchanged. China's central bank cut the required reserve ratio (RRR) for banks by 50 basis points to 20 percent on Saturday, freeing an estimated 400 billion yuan ($63.39 billion) for lending to head off the risk of a sudden slowing in the world's second-largest economy. "China's RRR cut is one sign that the government is doing something to arrest any slowdown. If anything growth is going to be okay there and the risk of a hard landing is a lot less," said Carey Wong, an investment analyst at OCBC Investment Research. But Wong said investors were still cautious due to political uncertainties in euro zone countries including Greece and Germany and were more keen on investing in defensive stocks such as Sembcorp Industries Ltd, which was among the top gainers on the STI. "With more than half of its earnings coming from utilities, Sembcorp Industries is a perfect fit to counter the cyclicality in marine," said CIMB in a report. The broker said it expects stronger growth for Sembcorp's utilities business. The stock was trading at 10 times 2013 price-to-earnings, making it a top pick due to attractive valuations, CIMB said. 1235 (0435 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ STOCKS NEWS SINGAPORE-DBS upgrades CSE Global to buy DBS Vickers upgraded CSE Global Ltd to buy from hold and raised its price target to S$0.90 from S$0.82, saying the company offers a 7 percent yield and its first-quarter net profit was on the high end of expectations. CSE is a technologies provider in the industrial automation, telecommunications, environmental and healthcare markets. Its shares were up 2.8 percent at S$0.735 but have lost around 2 percent so far this year. CSE sold its 30.94 percent stake in Malaysia's eBworx Bhd for S$21.4 million ($17.1 million) in cash and this will lead to higher profit and dividends, DBS said. CSE will record a one-time gain of S$10.3 million from the sale. CSE is bidding for six projects each worth S$40 million to S$100 million in the liquefied natural gas sector in Australia and DBS expects the firm to win at least one. For a related story, click link.reuters.com/tur28s 1105 (0305 GMT) (Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com) ************************************************************ DBS Vickers upgraded precision engineering firm Amtek Engineering Ltd to buy from hold and raised its target price to S$0.82 from S$0.75, citing better than expected quarterly earnings. Shares of Amtek were 1.6 percent higher at S$0.65 and have gained 10.2 percent since the start of the year. Amtek said its third quarter net profit fell 21 percent to $7.8 million from a year ago but this was higher than DBS's expectations due to stronger than expected sales in all business segments. Near term earnings are expected to improve, helped by a recovery in the hard disk drive segment and better margins, DBS said. Amtek also announced a surprise interim dividend of 2.3 Singapore cents. DBS said it expects Amtek to declare another dividend for the next quarter, lifting its dividend payout ratio to 55 percent from 50 percent. For related statement, click 1043 (0243 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ 10:08 STOCKS NEWS SINGAPORE-CIMB raises Frasers Commercial target CIMB Research raised its target price for Frasers Commercial Trust, which owns office assets in Asia, to S$1.14 from S$0.96 and maintained its outperform rating. Units of FCT were flat at S$0.935 but have gained 27 percent since the start of the year. The broker raised its distribution per unit estimates for FCT to factor in the use of proceeds from the sale of its KeyPoint property to partially redeem its convertible perpetual preferred units. FCT could unlock more value for its unitholders as the management is looking to exit the Japanese market, where its assets are worth S$114 million in total, CIMB said. CIMB said it expects FCT's stock price to see more upside as it offered an attractive yield of 8.9 percent for the fiscal year ended September. For related story, click 1004 (0204 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ 9:22 STOCKS NEWS SINGAPORE-OCBC upgrades UOL to buy OCBC Investment Research has upgraded property developer UOL Group Ltd to buy from hold and raised its target price to S$4.80 from S$4.77, citing higher average selling prices for one of its projects in Singapore. By 0111 GMT, shares of UOL were 0.5 percent lower at S$4.47 but have risen nearly 12 percent since the start of the year. UOL's first quarter net profit fell 63 percent to S$84 million ($67.2 million) due to lower revenue from property development and a drop in its share of profits from associated companies. This was in line with OCBC's expectations, with the broker saying UOL will continue to see revenue recognition from several Singapore properties. "Given limited land bank, we believe UOL to be relatively sheltered from uncertainties in the domestic residential space ahead," OCBC said in a report. For related story, click 0917 (0117 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ 8:46 STOCKS NEWS SINGAPORE-Index futures up 0.3 percent Singapore index futures edged up 0.3 percent, indicating a positive start for the benchmark Straits Times Index after the market fell 3.6 percent last week. Asian shares eased on Monday as investors saw more reasons to cut risk after talks in Greece to form a new government failed, a German vote pointed to growing opposition to austerity steps and China took further steps to support its fragile growth. For related story, click (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ($1 = 1.2504 Singapore dollars) Link this Share this Digg this Email Reprints

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