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. There was a soft start for Singapore market in September after Friday’s market holiday (1 Sep) due to Presidential Election.

Market has rebounded from the 3140 level nearing end of August (Note that market has also rebounded from this same level in June & July 2023). During these times, we saw that the three SG banks were retracing back to their respective support levels.

STI is attempting to break above the immediate resistance of 3250. We may see potential market upside towards 3325 - 3350 if price can hold above 3250. Note that key resistance level is around 3400, where sellers took control, as seen in January and July 23.

Hot News (Click to read):

• Singapore’s market cap down by 4.8% in Aug due to slower outlook for Chinese growth (The Business Times)

• India’s ‘massive expansion’ set to be a key driver of global economic growth (CNBC)

United States

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

Based on DJIA, the market was testing the support level of around 34,500. Market looks to be experiencing some short term weakness as we see the 20d MA is pointing downwards. Resistance remains round 35,600.

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.

Based on S&P 500, US market rebounded from the support of 4400 ,gaining some strength back towards the resistance of around 4600,where some market selling came back. If support is breached, may see some short-term selling pressure back to 4200 level.

US stock market was closed on Monday (4 Sep) in observance of Labour Day.

Upcoming Fed Meeting to be held on 19 - 20 Sep 23.

Hot News (Click to read):

• Consumer Price Index rose 3.2% from a year ago in Jul, slightly below expectations (CNBC)

• US economy adds 187,000 jobs in August while unemployment rate climbs from 3.5% to 3.8% (Yahoo)

Singapore Stocks Spotlight

DBS (SGX:D05)
Target Price: S$36.00

About DBS

• Leading financial services group in Asia with a presence in 18 markets

• DBS is at the forefront of leveraging digital technology to shape the future of banking, having been named "World's Best Digital Bank" by Euromoney

Fundamental

• Guidance provides an ROE of 15-17% in the next 3 to5 Years, boasted from faster growth in Capital light business such as Wealth management, global transaction services and treasury market sales.

• Ordinary Dividends expected to increase by 24 Cents in 2023

• Further upside as the bank operates above the Tier 1 Common Equity Capital Ratio

Technical

• Price is attempting to break above the immediate resistance of around 33.50

• Second level of resistance (R2) is around 34.50 where sellers took control at the start of August

• Longer term MA is consolidating sideway as 100d and 200d MA are pointing horizontally

• Potential upside price target towards 36.00 if price can break and hold above R2

DYNA-MAC (SGX:NO4)
Target Price: S$0.45

About Dyna Mac Holdings Ltd

• Dyna-Mac Engages in the provision of engineering, procurement, fabrication, construction and onshore pre-commissioning and commissioning of offshore topside modules and facilities

Fundamental

• Return on Capital Employed of around 16% which is higher than the industry average of 6.0%

• Company had recovered from losses it was generating five years ago

• It’s stock has returned an impressive 281% to shareholders over the last five years, it looks like investors are recognizing these changes, where this results could persist into the future

Technical

• Longer term uptrend remains intact as price is trading above both 100d and 200d MA

• Key immediate support around 0.380 where price has been holding above since Jul 23

• Resistance level is around 0.440 where selling pressure came back

• Potential upside price target towards 0.440 if support holds

KEPPEL CORP (SGX:BN4)
Target Price: S$7.50

About Keppel Corp

• Keppel Corp. Ltd engages in the provision of offshore and marine engineering and construction services

• It operates through the following segments: Energy and Environment, Urban Development, Connectivity ,Asset Management, and Corporate and Others

Fundamental

• Profit attributable to shareholders surged to SG$3.63 billion in the first half of the year, from SG$497.5 million a year ago

• Surge in profit to the SG$3.3 billion disposal gain from the divestment of its offshore and marine business

Technical

• Overall longer term uptrend is still intact as price is still holding above 100d and 200d MA

• Evening star pattern appeared on 31 Jul - 2 Aug which is also near the resistance level around 7.50 (Evening star is a top bearish reversal pattern)

• Seeing some short term weakness as price retraced from the high of 7.46 on 1 Aug 23 and crossed below the 20d MA

• Price has tested the 6.65 support level at the end ofAug 23. Potential upside target towards $7.50 if support holds

IFAST (SGX:AIY)
Target Price: S$6.20

About IFAST Corporation Ltd

• IFAST engages in the development of software, marketing of unit trusts, exchange traded funds, listed stocks, debt securities and Singapore government securities through websites, and acting as an investment advisor, dealer, and custodian in respect to securities

Fundamental

• IFAST booked a profit attributable to owners ofSG$3.6 million in the second quarter, against an attributable loss of SG$2.7 million a year earlier

• Total revenue slipped 3.1% year over year to SG$51.5million from SG$53.2 million

• Declared an interim dividend of SG$0.011 per share for the three months ended June 30

Technical

• Price has rallied on 27 Aug due to the earning results, however it is unable to form a new high, comparing to the period in Dec 2022

• Support is around 5.50 where buyers had manage to regain control on 22 Aug 23

• If price is able to hold above support, may potentially see some sideway consolidation between 5.50 - 5.80first as we are starting to see all 3 MAs flattening out

• Longer term trend still looks good as 100d and 200dMA is still heading in an upward trajectory

United States Stocks Spotlight

NVIDIA (NVDA.NQ)
Target Price: US$600

About Nvidia Corporation

• NVIDIA Corp. engages in the design and manufacture of computer graphics processors, chipsets, and related multimedia software

• Operating through the following segments; Graphics Processing Unit (GPU), Tegra Processor, and All Other

Fundamental

• Stock prices had reached an all time high, as earnings came in at US$2.70 vs US$2.09

• Revenue came in at US$13.51B vs U$11.22B

• Largely driven by its data centre segment which has seen a surge in business due to the uptake of AI services such as ChatGPT, the Board of directors has also authorized US$25B share buyback

Technical

• Price has gapped up and formed a large rising window on 25 May 23 due to strong earning results

• This rising gap acts as the key support zone, where bargain hunting could come back

• Price seem has been testing the 500 immediate resistance level which is also a key psychological level to watch

• Key support level at 400 which prices had been holding above since Jun 2023

• Longer term uptrend is intact since Mar 2023 when100d MA has crosses above 200d MA and current price is also trading above all MAs

APPLE INC (AAPL.NQ)
Target Price: US$200

About Apple Inc.

• Apple Inc designs, manufacture, and sale of smartphones, personal computers, tablets, wearables and accessories, and other varieties of related services

• It operates through the following geographical segments: America, Europe, Greater China, Japan, and Rest of Asia Pacific

Fundamental

• AAPL reached new all-time highs of $198.23 going into Q3 earnings

• Revenue declined by -1.4% YoY. In its 2023 fiscal year, AAPL generated $293.79 billion in revenue compared to $304.18 billion in the first 9 months of 2022

• Generated $74.04 billion in net income and $80.15 billion in free cash flow over the past 9 months, $8.23 billion in net income and $8.91 billion in FCF per month

• More profits and FCF than any other company in the market and utilizing those proceeds to generate value for shareholders

Technical

• Price has formed an upward sloping channel support line since the start of 2023, which has been broken in Aug

• Key support level is around 170 where price has consolidated sideway for 3 weeks in May and rebounded on 18 Aug 23

• If price can break and hold above 185, potential upside target towards 200

APPLIED MATERIALS (AMAT.NQ)
Target Price: US$170

About Applied Materials Inc

• Applied Materials, Inc. provides manufacturing equipment, services and software to the semiconductor, display and related industries. Operating through the following segments: Semiconductor Systems, Applied Global Services, and Display & Adjacent Markets

Fundamental

• Outperforming expectations and showcasing its ability to weather industry fluctuations

• Revenue was down 1.4% YoY. Reported revenue of $6.43 billion

• Continued growth can be expected if company able to maintain operating margins above 25%

• EPS in Q3 was $1.90, down 2% YoY but topping the consensus by $0.15

Technical

• 20d MA has bounced off the 100d MA in May 23which has bullish implications. Overall long term uptrend remains intact as price holds above the 135 support level

• Rising three method pattern appeared on 14 - 18 Aug which is a bullish continuation candlestick pattern

• Potential upside targets towards 170 if price can break and hold above immediate resistance of 155

ELI LILLY AND CO (LLY.NYSE)
Target Price: US$620

About Eli Lilly and Company

• Eli Lilly and Company discovers, develops, and markets human pharmaceuticals worldwide

• Company overtook the market leader last year and is currently one of the most valuable drug producers in the world

Fundamental

• $8.3B in revenue with around 28% YoY growth due to a 29% increase in volumes

• Gross margin remained flat at ~80% from last year, non-GAAP earnings jumped ~69% YoY to $2.11 per share

• Increased its full-year guidance for revenue and adjusted EPS to $33.4B 33.9B and $9.70 – 9.90, compared to $31.5B and $8.75 per share in previous consensus

Technical

• Price has rallied on 8 Aug due to good earningresults causing a huge rising window gap which actsas the support zone

  Price has tested this 560 level for about 2 weeks in Aug which indicates that if this level is broken, buyers are in control

  If price is able to break and hold above 560 with above average volume, potential upside target towards 620

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