Morning Wrap | OCBC Announces Q4 Profit Increase and Capital Return Plans

Moomoo News SG wrote a column · Feb 26 09:27

Morning Wrap | OCBC Announces Q4 Profit Increase and Capital Return Plans

Good morning mooers! Here are things you need to know about today's Singapore markets:

- Singapore shares opened lower on Wednesday

- US stocks fall on trade concerns and weak consumer data; Tech stocks lead market decline.

- Singapore Equities See 6% Growth with Strong Performance in Finance and Telecom Sectors

- Stocks to watch: OCBC, CDL, SingPost, Food Empire, SingLand, etc.

- Latest share buy back transactions

Market Snapshot

Singapore shares opened lower on Wednesday:

Today's Volume / Value: 140.67M / S$304.39M

Advancers / Decliners: 122 / 90

US stocks fall on trade concerns and weak consumer data; Tech stocks lead market decline.

U.S. markets retreated Tuesday, with tech stocks leading the decline. The $Nasdaq Composite Index (.IXIC.US)$ fell 1.35%, marking a 5% drop over five sessions, while the $S&P 500 Index (.SPX.US)$ dipped 0.47%. The $Dow Jones Industrial Average (.DJI.US)$ edged up 0.37%.The sell-off was driven by concerns over chip trade restrictions, Tesla's sales issues, and weak consumer confidence data, which sent the "Magnificent Seven" tech stocks into correction territory.

The S&P 500 narrowly avoided closing below its 100-day moving average for the first time since August. Consumer confidence hit a nine-month low, reaching its steepest month-over-month decline since 2021.

However, the main factor pressuring tech stocks was news of potential semiconductor trade restrictions. Bloomberg reported that the White House had discussions with Japanese and Dutch officials about limiting semiconductor equipment exports to China, expanding on existing Biden-era policies.

Breaking News

Singapore Equities See 6% Growth with Strong Performance in Finance and Telecom Sectors

Singapore's equity market has seen a notable increase of 6.0% over the past three months, outpacing its ASEAN counterparts, as reported by FTSE Russell. This growth has been primarily fueled by significant gains in the Financials sector, which saw a 13.0% rise, and substantial contributions from the Telecom and Utilities sectors. Financials benefited from rate correlations with the US, while growth in the Telecom sector is driven by the expansion in AI-driven data center capacities.

Additionally, wealth management is becoming a key growth area, bolstering Singapore's status as a rising financial hub in Asia. Despite the Monetary Authority of Singapore's (MAS) easing policy in response to lower core inflation and global trade uncertainties, Singapore's interest rates continue to align with US rates, supporting the financial sector's robust performance. This resilience is also bolstered by the government's commitment to increase data center capacity, enhancing Singapore's capabilities in AI and digital technologies.

Meanwhile, Singapore government bond yields have remained stable, benefiting from steady domestic inflation and correlations with US yields.

Stocks to Watch

$OCBC Bank (O39.SG)$ disclosed on Wednesday that its net profit rose by 4% in the fourth quarter to S$1.69 billion, compared to S$1.62 billion in the corresponding period of the previous year. However, this was below the expected S$1.78 billion as predicted by a Bloomberg survey of five analysts. The bank has declared a final dividend of S$0.41 per share and recommended a special dividend of S$0.16 per share, as part of its strategy to distribute S$2.5 billion to shareholders over two years through special dividends and share buybacks. OCBC’s shares dropped by S$0.09 or 0.5% to S$17.60 on Tuesday.

$CityDev (C09.SG)$ reported a steep 54.7% fall in net profit to S$113.5 million for the second half, down from S$250.8 million in the previous corresponding period. Revenue also decreased by 23.6% to S$1.7 billion from S$2.2 billion. Consequently, the full-year profit for FY2024 was S$201.3 million, a 36.6% reduction from S$317.3 million in the previous year. CDL shares dropped by S$0.02 or 0.4% to S$5.12 on Tuesday, and a trading halt was requested on Wednesday morning pending an announcement.

$SingPost (S08.SG)$ announced it will convene an extraordinary general meeting (EGM) on March 13 at 3.30 pm to seek shareholder approval for the divestment of its Australian business, Freight Management Holdings. The deal values the enterprise at A$1.02 billion (S$867 million) and is anticipated to result in a disposal gain of about S$289.5 million. SingPost's shares remained unchanged at S$0.55 on Tuesday.

$Food Empire (F03.SG)$ reported a minor decline of 3.2% in net profit to US$28.9 million for the second half, down from US$29.8 million in the same period last year. However, revenue increased by 10.4% to US$251.1 million from US$227.5 million. The company proposed a total dividend per share of S$0.08, which includes a final dividend of S$0.06 and a special dividend of S$0.02. Shares of Food Empire closed 1% lower at S$0.975 prior to the announcement.

$SingaporeLandGrp (U06.SG)$ reported a robust 76% increase in net profit to S$180.5 million for the second half, up from S$102.4 million in the previous year. Revenue grew by 9% to S$390.5 million from S$358.7 million. The earnings per share, excluding fair-value gains on investment properties, increased to S$0.093 from S$0.07. SingLand's shares dipped by S$0.01 or 0.5% to S$1.92 on Tuesday before the announcement.

Share Buy Back Transactions

Source: Business Times, SGinvestors.io, Business Review

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