STOCKS NEWS SINGAPORE-Shares retreat as Golden Agri weighs

Thu Jan 17, 2013 4:24am GMT

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Singapore's main index retreated by midday, dragged by losses in shares of palm oil firm Golden Agri-Resources Ltd and as investors remained cautious ahead of Chinese economic data on Friday.

The Straits Times Index fell 0.4 percent to 3,196.28 points, while the MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.3 percent.

Golden Agri shares fell 3.1 percent to S$0.62, after J.P. Morgan downgraded the stock to 'underweight' on expectations it will miss its fourth-quarter earnings forecast.

China will post several economic reports on Friday, including fourth-quarter GDP, December industrial output, retail sales and house prices, which will offer clues on the health of Asia's biggest economy.

Singapore's government said on Thursday it plans to build two new train lines and extend three, which could boost construction firms in Singapore, such as Yongnam Holdings Ltd , which is up 2.1 percent at S$0.245.

1214 (0414 GMT)

(Reporting by Charmian Kok in Singapore; Editing by Prateek Chatterjee; charmian.kok@thomsonreuters.com) (charmian.kok.thomsonreuters.com@reuters.net)

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11:40 STOCKS NEWS SINGAPORE-JPMorgan downgrades Golden Agri to 'underweight'

J.P. Morgan downgraded palm oil firm Golden Agri-Resources Ltd to 'underweight' from 'neutral' and lowered its target price to S$0.50 from S$0.56, on expectations it will be hurt by a muted recovery in crude palm oil (CPO) prices.

By 0329 GMT, shares of Golden Agri were down 3.1 percent at S$0.62, and have fallen about 4.6 percent since the start of the year, compared to the Straits Times Index's 1 percent rise.

J.P. Morgan said it expects Golden Agri's fourth-quarter earnings to miss expectations, and forecast a 20 percent quarter-on-quarter decline in core net profit to $69 million as average CPO prices fell 23 percent in the period.

It also cut its 2013 and 2014 earnings per share estimates by 10 percent to factor in lower CPO prices.

Indonesian plantation companies, including Golden Agri, are expected to see meaningful labor cost increase following this year's rise in minimum wage, the brokerage said.

1131 (0331 GMT)

(Reporting by Charmian Kok in Singapore; Editing by Sunil Nair; charmian.kok@thomsonreuters.com; Reuters Messaging: teo.jionchun.thomsonreuters.com@reuters.net)

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10:25 STOCKS NEWS SINGAPORE-CIMB raises Midas Holdings target price

CIMB Research raised its target price for Midas Holdings , which supplies components for train projects, to S$0.59 from S$0.53 and kept its 'outperform' rating, as its recent contract win reflects strong orders for the railway industry going forward.

At 0214 GMT, Midas shares were up 1 percent at S$0.525, and have gained 25 percent since the start of the year, compared to a 1.8 percent rise in the FTSE ST All Share Index.

Midas's 32.5 percent-owned associate Nanjing SR Puzhen Rail Transport Co. Ltd (NPRT) won a tram contract worth 338 million yuan ($54.37 million), adding to NPRT's order book of 9 billion yuan, CIMB said.

"This lends credence to our expectations of positive order flow momentum and could signify back-to-back contract win announcements and further re-rating potential," said CIMB, adding that major clients have restarted negotiations with key suppliers.

1016 (0216 GMT)

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