STOCKS NEWS SINGAPORE-Shares snap 7-day winning streak

Wed Nov 28, 2012 5:27am GMT

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Singapore's main index fell by midday, snapping its seven-day winning streak, on growing concerns over the lack of progress over U.S. budget woes.

At 0509 GMT, the Straits Times Index was down 0.3 percent at 3,003.46 points, while the MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.5 percent.

U.S. stocks slid overnight after Senate Majority Leader Harry Reid expressed disappointment over the little progress in dealing with the approaching "fiscal cliff" of deep cuts in government spending and big tax increases early next year.

Commodity trader Olam International Ltd earlier tumbled as much as 6 percent to a three-and-a-half year low, but recouped some losses, after it launched a defence against short-seller Muddy Waters' allegations over its accounting practices and acquisitions.

By midday, Olam shares were down 0.6 percent at S$1.55. Jardine Matheson Holdings Ltd took the biggest hit on the STI, falling 2.2 percent to $58.09, while property developer Hongkong Land Holdings Ltd dropped 2 percent to $6.38.

1316 (0516 GMT) (Reporting by Charmian Kok in Singapore; Editing by Prateek Chatterjee; charmian.kok@thomsonreuters.com)

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12:40 STOCKS NEWS SINGAPORE-Religare downgrades Olam to 'sell'

Religare Capital Markets downgraded Olam International Ltd to 'sell' from 'buy' and cut its target price to S$1.40 from S$2.40, as it expects the commodity trader's shares to be weighed down by concerns raised by short-seller Muddy Waters.

By 0426 GMT, Olam shares were down 0.96 percent at S$1.55, off an intraday low of S$1.465, which was a three-and-a-half year low. Its shares have plummeted 27.5 percent since the start of the year, compared with a 13.5 percent rise in the Straits Times Index.

"Olam shares will face difficulty re-rating upwards and sustaining even a moderate earnings multiple for the next few quarters, even if the financial risks Muddy Waters warns of don't materialize," Religare said in a note.

The brokerage noted Olam's guidance that it won't be generating positive free cash flow until 2015, making it hard for the company to completely dispel the concerns raised.

1228 (0428 GMT) (Reporting by Charmian Kok in Singapore; Editing by Prateek Chatterjee; charmian.kok@thomsonreuters.com)

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12:15 STOCKS NEWS SINGAPORE-DBS starts Religare Health Trust at 'buy'

DBS Vickers initiated coverage of Religare Health Trust with a 'buy' rating and a target price of S$0.97, citing an attractive dividend yield and exposure to the fast-growting Indian healthcare sector.

By 0402 GMT, Religare Health shares were up 3 percent at S$0.82, but still 8.9 percent lower than the initial public offer price of S$0.90. Religare Health made its market debut last month.

The brokerage expects Religare Health, which has 17 assets and is backed by India's healthcare services provider Fortis Healthcare, to pay a distribution yield of around 10 percent at its current price, and is structured to offer upside potential through variable fees.

As 96 percent of Religare Health's assets are operational, distribution income can be sustained till 2014, providing assurance that it will be able to meet DBS' distribution per unit forecasts, it said in a report.

"Healthcare industry outlook in India looks promising," DBS said, citing Frost and Sullivan's estimates that the market will grow at an annual average rate of 15 percent from 2010-2015 on the back of rising and aging population and growing affluence.

1205 (0405 GMT)

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