Singapore Shares Lacklustre Despite Narrow STI Gain
Local shares were lacklustre as losers outnumbered gainers 270 to 175 despite STI ending with a narrow gain of 0.7% at 2,333.14. The benchmark index returned most of its early session gains led by window-dressing due to a weak start from the European markets and tepid lead from US futures. Traders warned of choppy session over the next day post window-dressing. Propping up the index stocks were conglomerate Jardine Matheson and its related companies Jardine Strategic Hldgs and Jardine Cycle & Carriage which gained 5%, 4.4% and 4.9% respectively after HSBC initiated Jardine Matheson at Buy. SIA also rose 3.9% to end at $13.30 on hopes that rising oil prices will lower the firm’s fuel-hedging losses. Among the sub-sector indices, both FTSE ST China and FTSE China Top Index, which track the PRC companies listed on the SGX, fared the worst with 2.1% and 2.7% in the red respectively.
Wall St Slides On Fading Confidence
US stocks registered their best quarter in a decade on Tuesday, in spite of falling during the day to take the markets lower for June. Oil prices swung back to US$70 and poor economic news knocked confidence in equities with US home prices continuing their multi-year tumble in April, according to the S&P Case-Shiller home-price indices, although the decline was smaller for the 3rd month in a row. This was coupled with indications that consumer confidence unexpectedly fell during June, exacerbating worries about how much individuals are likely to spend. The benchmark S&P 500 closed 0.9% down at 919.32 points. The DJIA fell 1% to 8,447 and the Nasdaq composite dropped 0.5% to 1,835.04. That left the market more than 15% higher for the quarter, the best since December 1998.
FCT Recapitalises With $675m Loans And $214m Rights Issue Plan
Frasers Commercial Trust (FCT) has secured financing for $675m from a consortium of lenders, conditional upon the company’s upcoming recapitalisation exercise, which has yet to be approved by shareholders. The recapitalisation exercise consists of a 3-for-1 rights issue to raise $213.9m and acquisition of Alexandra Technopark from its sponsor, Frasers Centrepoint, for $342.5m by way of issuance of convertible perpetual preferred units, entitling the latter to a distribution of 5.5% a year from the company. The entire exercise will reduce the company’s gearing from 58.3% as at end 1Q09 to 38.5% and free the company of any debt due until 2012.
F&N and Coca-Cola Extends tie-ups
Fraser and Neave (F&N) and The Coca-Cola Company have agreed on new transition arrangements under which F&N will continue to bottle, distribute and sell brands from Coca-Cola for the market in Malaysia while Coca-Cola will continue to bottle, distribute and sell brands from F&N for the market in Singapore and Brunei during the transition period which will run for 20 months till September 2011 after their current bottling arrangements expire in January 2010. The transition agreements is said to allow both companies to independently pursue opportunities in categories other than sparkling fruit-flavoured drinks, isotonic drinks and sparkling beverages in Malaysia, Singapore and Brunei.
