STI Buckles Under Late Sell Off
The STI appeared to be heading towards positive grounds in the early afternoon before a late sell off, triggered by sharp falls in the Hang Seng Index as well as in European bourses during the opening hours, sent the benchmark index back into the red at 2,271.45, down 0.73%. Casino operator Genting Singapore gained the most at 3.9% among the index stocks, followed by telco StarHub and conglomerate ST Engineering with 2.9% and 2.5% respectively. Among the losers, NOL was down 12.5% after trading ex-rights and local banks ended weaker across the board by 0.6% to 2%. On the broader market, aluminium alloy maker Midas Hldgs was up 8.4% at $0.71 after news of the company landing 2 contracts worth Rmb603m in total. Abalone producer Oceanus Group rebounded 7.3% to close at $0.295 despite downgrade by DBS Vickers from buy to hold on account that its potential business growth had been priced in and that it faces ‘high interest cost and potential dilution to share capital’ risks.
Wall Street Mixed In Choppy Trade
US stocks fluctuated on Wednesday as bullish healthcare stocks balanced a flagging financial sector, which fell as the government released details of proposed new regulations. The Obama plan would mean tighter controls on capital reserves, which was part of the reason for the decision by S&P to downgrade 22 banks. Although shares rallied in the afternoon as investors took confidence from positive words about the outlook for the US on its AAA credit rating from S&P and figures showing inflation is not a near-term concern with CPI rising less than forecasted, they fell back again shortly before the close. The benchmark S&P 500 and the DJIA both closed 0.1% down at 910.71 and 8,497.18 respectively. The Nasdaq Composite index gained 0.7% to 1,808.06 however.
Shareholder Opposes Asia Water’s Proposals
Asia Water Technology’s proposed investment and proposed rights issue have hit the wall as substantial shareholder EGN Nominees indicated its intention to oppose the moves. The latter has also called for the resignation of 4 existing board members and nominated 3 new directors to replace them. An EGM would be called subsequently for, among other things, the execution of voting of ‘no’ confidence against the board.
MAP Tech Proposes $14.9m Rights Issue
MAP Technology Hldgs is proposing a renounceable non-underwritten 4-for-1 rights issue of up to 1.48b new ordinary shares at $0.01 per share to raise up to $14.9m in net proceeds under full subscription. Min Aik Technology, which holds approximately 42.72% shareholding interest in the company, has undertaken to subscribe in full for its entitlements and may apply for excess rights shares not being taken up. The company has also issued a profit warning that it anticipates to make a loss for 2Q09 and subsequently FY09 ending 31 December 2009 following poor sales and among other reasons, provision for doubtful debts and higher interest cost.
STATS ChipPAC Expands Capacity For Wafer Level Packaging
STATS ChipPAC has announced that it is expanding capacity for full turnkey wafer level packaging in its Singapore operation due to the latter’s increasing demand in mobile applications and that it is on track to achieve another 50% increase in wafer level capacity by 3Q09. The company has previously been on a steady production ramp with wafer level packaging services and more than doubled its production volume in 2008.