SG Bonds Weekly – Week 34 August 17, 2020 248

Outlook for the week

  • Bond markets are still boyant as spreads tighten for 7 consecutive weeks in Asia as new issuances are still being snapped up. This is amidst the backdrop of US Treasuries seeing lackluster demand for their auction last week as investors seek higher yields elsewhere. Expect more new issuances in our local markets. Despite the Ministry of Trade and Industry narrowing growth forecasts for 2020 from “-7% to -4%” to “-7% to -5%”, signalling a more cautious outlook, mass testing of dormitories are nearing completion which could boost construction activities in our property market.


Key economic releases for the week

  • Monday, 17 August 2020: SG Non-oil Domestic Exports YoY (8:30AM)
  • Friday, 21 August 2020: US Markit PMI Manufacturing (4:30PM)


Past week: Key events

  • A flurry of result releases last week:

Olam International: Results were poorer from lower commodity prices and demand for non-food products and out-of-home related food products, while ended gearing higher.

Centurion Corporation Limited: PBSA assets impacted by travel restrictions and online classes, while more provisions made for receivables as some tenants face financial strain. Worker dorms are stable however expenses higher due to covid measures, and new developments are put on pause.

Keppel Corp: Temasek’s partial offer has been taken off and bond prices fell on the news. Results were affected by yard closures, lockdowns and some orderbook terminations. Revenue fell across all segments.

City Developments Limited: Hotels still in the red, but residential sales are resilient with lower land supply and stable prices. Balance sheet is healthy with plans to divest non-core hotel assets and china retail malls to boost liquidity.

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About the author

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Timothy Ang
Research Analyst
Phillip Securities Research

Timothy covers credit analysis of local and foreign bonds. Previously an equity dealer, he handled equity trade execution and portfolio management. He has presented seminars for organisations such as SIAS, SPH and IRAS, commentated live market updates for 93.8FM, and authored investment articles for the Business Times newspaper. He graduated with a Bachelor of Commerce in Accounting & Finance from the University of Western Australia.

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