Market Overview

Singapore

Straits Times Index (STI) is a market capitalization weighted index that tracks the performance of the top 30 companies listed on SGX.

With the latest data provided by Monetary Authority of Singapore, it is reported that Singapore's economy grew modestly in Q2 2024, with a 0.4% increase in GDP from the previous quarter.

Tourism and manufacturing saw stabilization, while transport and modern services picked up. Despite easing labour market tightness, employment growth slowed, and wage pressures began to moderate.

Inflation also eased, with MAS Core Inflation at 3.0% in Q2, down from 3.3% in Q1. Looking ahead, economic growth is expected to stay strong, supported by global tech and financial services, while inflation should continue to decrease, averaging around 2.5-3.5% for the year.

STI managed to push higher in Jul, testing the key resistance level around 3500, where selling pressure had returned. After witnessing a 2.6% pullback, price started to stabilze and move sideways, further supported by the flattening of 20d MA

With longer-term trend (100d and 200d) still looking optimistic, potential bargain hunting may return near the new higher support around 3300 where the 100d MA resides.

Hot News (Click to read):

• Singapore’s employment growth up in Q2, despite seasonal dip in resident employment (The Business Times)

• MAS holds steady at July review; economists expect easing only in 2025 (The Business Times)

United States

Dow Jones Industrial Average (DJIA) tracks the daily price movements of 30 large, public-owned blue-chip American companies.

The index has indeed broke above the 40,000 resistance level, turning it to a new support. The new support was retested shortly. Despite 20d MA still heading up, signaling strong short-term momentum, both 100d and 200d MA are starting to taper off sideway, indicating a potential consolidation

S&P 500 Index is a market-capitalization weighted index of the 500 leading companies in the US which is widely considered as one of the best gauge of the US economy.

Selling pressure returned as price approached the 5700 level. Support level around 5400 still remains intact. Longer term trend based on 100d and 200d MA still looks healthy, despite seeing some short-term weakness as seen from the slight dip in the 20d MA.

US inflation has slowed, leading to lower Treasury yields as markets expect potential rate cuts from the Federal Reserve. Despite political developments ahead of the November election, asset prices have remained stable. Core PCE inflation decreased in Q2, and the job market showed mixed signals with strong payroll growth but rising unemployment. Economic activity has slowed but continues to grow, with notable investment in business equipment.

The Federal Reserve maintains the federal funds rate at 5.25-5.5%, focusing on achieving 2% inflation before considering rate cuts.

Hot News (Click to read):

• Fed holds rates steady and notes progress on inflation (CNBC)

• Here’s what changed in the new Fed statement (CNBC)

Singapore Earnings Calendar

Note that the below information is taken from the confirmed dates on Earnings Whispers. We've exclusively chosen stocks favored by investors with widely recognized names. The below calendar is not exhaustive. Please refer to Earnings Whispers for the full list.

US Earnings Calendar

Note that the below information is taken from the confirmed dates on Earnings Whispers. We've exclusively chosen stocks favored by investors with widely recognized names. The below calendar is not exhaustive. Please refer to Earnings Whispers for the full list.

Singapore Stocks Spotlight

STARHUB (SGX:CC3)
Target Price: S$1.35

About StarHub Ltd

• StarHub Ltd offers communication and entertainment services in Singapore through its Telecommunications and Cyber Security segments

• It provides television subscription, broadband access, and information security solutions, alongside network security surveillance services

Fundamental

• Posted an 8.1% rise in net profit to S$40.1m for the first quarter ended Mar 31, from S$37.1m a year earlier

• Total revenue dipped 0.1% to S$545.4m over the same period a year ago, from S$546m

• Rise in net profit due to higher share of profits from joint ventures and associates, lower net financing cost, lower depreciation and amortization and taxation charges

• Expects to launch its low-latency data centre connect solution in the third quarter of this year

Technical

• Price has hit our May target of 1.28 where it is normal to see some selling pressure returning near resistance

• Long term uptrend still remain intact with 100d and 200d MA still heading up

• In terms of 20d MA, it is fluctuating between 1.20 - 1.28, potentially seeing a short-term sideway consolidation

• If price is able to break and hold firmly above 1.28, potential upside target towards 1.35

SIA ENGINEERING (SGX:S59)
Target Price: S$2.50

About SIA Engineering

• SIA Engineering is a leading regional aircraft maintenance, repair, and overhaul (MRO) company with bases in Singapore and the Philippines

• Participates in Joint Ventures (JVs) with reowned OEMs allows it to provide a full suite of MRO Services

Fundamental

• FY24 core net profit surged 93.1% year on year to S$121m, driven by a surprise positive operating profit in 4QFY24 and slightly higher-than-expected share of profits from its associates and JVs

• Share of profits from associates and JVs improved 14.3% sequentially to SGD27.2m in 4QFY24, likely bolstered by higher work volumes at its key JVs (Eagle Services Asia)

• The company declared a final DPS of $0.06, bringing the full-year DPS to $0.08

Technical

• Long term trend (100d and 200d MA) has been heading sideway since May 2023, where 20d MA has been fluctuating up and down

• Furthermore, price has been consolidating between the range of 2.20-2.40 as well

• Note that 100d MA is also attempting to break above 200d MA in late Jul

• If price can break and hold firmly above 2.40 with 100d MA holding above 200d MA, potential upside target to 2.50 first

IFAST CORPORATION LTD (SGX:AIY)
Target Price: S$8.50

About IFAST Corporation Ltd

• iFAST is an internet-based investment product distribution platform

• Over 12,800 wealth advisors use its B2B platforms and more than 800,000 customer accounts have been opened across the five markets – Singapore, Hong Kong, US, Malaysia, and China

• Offering over 22,500 investment products including funds, bonds, stocks, and ETFs

Fundamental

• iFAST’s scalable platform business model enables the group to scale up without a proportionate increase in cost

• iFAST has set a 10-year target to reach S$100b in assets under administration (AUA) by 2028-2030

• Return on equity ratio (ROE) has also improved to 21.9% in 1Q24, vs 12.2% in FY23

• Core wealth management platform is also advancing while the net margin improves

Technical

• Immediate resistance is around 7.75 where we saw selling pressure returned as price approached it in May and Jul

• Support remains at psychological 7.00 for now

• If price can break and hold above resistance, potential upside target towards 8.50, otherwise may see sideway consolidation between 7.00 - 7.75 until more confirmation from MAs

United States Stocks Spotlight

GRANITE CONSTRUCTION (GVA.NQ)
Target Price: US$75.00

About Granite Construction

• Granite Construction operates as an infrastructure contractor and a construction materials company in the United States.

• Involved in the construction and rehabilitation of roads, pavement preservation, bridges, rail lines, airports, marine ports, dams, reservoirs, aqueducts, infrastructure, and site development for use by the public.

Fundamental

• Revenue increased 20% YOY, driven by strong performances from both construction and materials segments

• Construction gross profit margin was 15%, driven by higher quality project portfolio and execution

• Strong revenue growth in Q2 FY24, adjusted EBITDA and operating cash flow well ahead of 2023

• Acquisition of Lehman-Roberts Company and Memphis Stone & Gravel providing a platform for further growth

• Strong balance sheet and liquidity position

Technical

• Both short-term MA (20d) and long-term MA (100d and 200d) are aligned and heading up, indicating that uptrend is intact

• Immediate psychological support is around 64 and psychological resistance is around 70.00, where some selling pressure can return first

• If price can break and hold firmly above 70.00, target to be revised higher towards 75.00

BERKSHIRE HATHAWAY INC (BRK.B.NY)
Target Price: US$460.00

About Berkshire Hathaway Inc

• Globally involved in insurance, freight rail transportation, and utilities

• Offers a range of insurance services and operates rail systems in North America

• Established in 1998, headquartered in Omaha, Nebraska

Fundamental

• Company reported earnings of $30.3 billion in the second quarter versus a profit of over $35.9 billion in the same quarter of 2023

• The most significant business by year-to-date operating earnings is insurance, followed by the manufacturing, service, and retailing segment

• A 39% increase in operating earning for Q1, reaching $11.22b, driven by 185% rise in insurance underwriting

• Company’s cash reserve hit a record of $188.99b, suggesting challenges in finding major acquisition targets

Technical

• 20d MA has started to point up in early Jul, aligning with both longer term MA (100d and 200d) as price break above 430 resistance

• Price is currently retesting the new 430 support after release of earnings

• As long as support holds and all 3 MAs are still heading higher, potential upside target towards 460 where some profit-taking can happen

WALMART INC(WMT.NY)
Target Price: US$76.00

About Walmart Inc

• Walmart Inc. engages in the operation of retail, wholesale, other units, and eCommerce worldwide

• Operating through three segments: Walmart U.S., Walmart International, and Sam's Club

• Additionally, the company markets lines of merchandise under private brands, including Allswell, Athletic Works, Equate, and Free Assembly

Fundamental

• The company's strategic expansion, focus on price-sensitive consumers, and innovative technology integration have led to strong growth despite economic challenges

• In Q1, the company reported 5.7% sales growth and 12.9% higher adjusted operating income on a constant currency base

• It expects to grow its revenue by roughly 4% per year over the next five years

• Operating income is expected to grow by up to 8% per year

Technical

• Uptrend still remain intact for this counter as all 3 MAs are heading upwards

• Price gapped up by about 5% after the last earning report in May, which act as a rising window support

• Higher lows are subsequently spotted over the next few months

• Price is testing the 68.00-69.00 level.

• Would be good to see some sideway consolidation first as seen in Mar-May 24 for the uptrend to be healthy and sustainable

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