STOCKS NEWS SINGAPORE-Noble drags index lower

Fri Nov 9, 2012 5:06am GMT

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Singapore shares were slightly lower, dragged by Noble Group Ltd after the commodities trader reported lower-than-expected earnings for its third quarter.

The Straits Times Index was down 0.1 percent at 3,008.53 points, while MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.2 percent.

Noble shares were down 7.5 percent at S$1.18 on volume of 108.5 million shares. The stock was the top traded by value in the Singapore market.

"We expect Noble to see a negative knee-jerk reaction to its lower-than-expected earnings," OCBC Investment Research. But it expects Noble to have a "reasonable" recovery next year.

DBS Vickers cut its core earnings estimates for 2012-2014 fiscal years by 6-21 percent on reduced agriculture and energy contribution. But it still sees Noble's earnings trending higher despite volatility on a quarterly basis.

DBS cut its target price to S$1.50 from S$1.60 but maintained its 'buy' rating.

However, Wilmar International Ltd outperformed the market after its third-quarter earnings beat forecast, helped by its sugar business and a rebound at its oilseeds and grains unit after two quarters of losses.

Wilmar shares were up 3.2 percent at S$3.22 on volume of 22.2 million shares, 1.6 times its average daily volume over the last five sessions.

1253 (0453 GMT) (Reporting by Charmian Kok in Singapore; Editing by Anand Basu; charmian.kok@thomsonreuters.com)

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12:50 STOCKS NEWS SINGAPORE-OCBC ups target price for Venture Corp

OCBC Investment Research raised its target price for electronics contract manufacturer Venture Corp Ltd to S$9.22 from S$8.72 and kept its 'buy' rating, on expectations of a recovery in its business next year.

By 0321 GMT, Venture shares fell 0.3 percent to S$7.68, and have jumped 23.9 percent since the start of the year, compared to a 21.9 percent rise in the FTSE ST Industrials Index .

Venture said its third-quarter net profit fell about 8 percent to S$32.6 million from a year earlier, which was weaker than OCBC's expectations due to poor margins.

OCBC highlighted that Venture's management had warned about cautious customer sentiment in light of weak market demand due to macroeconomic uncertainties. The brokerage pared its 2012 revenue and net profit estimates by 1.6 percent and 9.1 percent respectively.

However, OCBC expects Venture to maintain its attractive dividend of 55 Singapore cents a share in the fourth quarter, supported by strong free cashflows.

1128 (0328 GMT) (Reporting by Charmian Kok in Singapore; Editing by Anand Basu; charmian.kok@thomsonreuters.com)

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11:15 STOCKS NEWS SINGAPORE-Noble down at 2-month low, CIMB cuts target price

CIMB Research cut its target price on commodity trading firm Noble Group Ltd to S$1.45 from S$1.61 and kept its 'outperform' rating, citing worse-than-expected earnings and poor performance in its agriculture business.

By 0239 GMT, Noble shares were down 7.8 percent to a two-month low, with over 93 million shares traded, 3.2 times its average daily volume over the last five sessions. Its shares have gained 4 percent since the start of the year, compared to the 13.7 percent rise in the Straits Times Index.

"Unlike its global peers Bunge and Cargill, Noble failed to ride on the tailwinds of improving agribusiness dynamics," said CIMB in a report.

Despite Noble's new sugar assets and peak harvesting season, its agriculture revenue fell 34 percent from a year earlier, which the management blamed on poor China crush margins and volatile corn and soybean prices.

Higher depreciation in its new sugar mills also dampened Noble's profit margins, while operating expenses were higher-than-expected, CIMB noted.

While the brokerage expects near-term share price weakness for Noble, it maintained its 'outperform' rating due to its positive long-term growth plans.

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