June 20, 2012 / 6:12 AM / 7 years ago

STOCKS NEWS SINGAPORE-Wilmar tops gainers in strong market

Singapore shares rose for the fourth session in a row, with palm oil firm Wilmar International Ltd surging to a three-week high after its recent underperformance.

The Straits Times Index was up 0.4 percent at 2,853.4 points, while MSCI’s broadest index of Asia Pacific shares outside Japan added 0.5 percent.

Wilmar rose as much as 7 percent to S$3.80, the highest since May 28 and crossed its 20-day moving average. Traders cited no specific company-related developments but market appetite for commodity stocks has improved this week.

More than 15 million Wilmar shares were traded, 1.4 times the average full-day volume over the past 30 days. With its shares falling more than 20 percent this year, Wilmar is still the biggest decliner in a market up 8 percent this year. Wilmar’s first-quarter results announced in May disappointed investors.

Among other gainers, shares of Aussino Group Ltd surged as much as 26 percent and have doubled since the bed linen firm said on Monday it would enter Myanmar’s petrol kiosk business. Aussino was among the top 10 traded stocks by volume in Singapore.

1407 (0607 GMT)

(Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com)

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13:01 STOCKS NEWS SINGAPORE-DMG & Partners Securities downgraded its rating on instant beverage maker Super Group Ltd to neutral from buy and lowered its target price to S$2.12 from S$2.18, citing a recent spike in the prices of coffee beans, a major raw material for Super.

Shares of Super Group were down 0.45 percent at S$2.20 on Wednesday. This year, Super shares have surged around 67 percent, outperforming the 12.6 percent gain in the FT ST Mid Cap index.

DMG cut its earnings estimate for Super’s 2012 fiscal year by 4 percent to S$68 million $53.7 million). The broker said it saw some headwinds from higher robusta coffee bean prices that averaged $2,125 per tonne in May.

DMG said upside potential to Super’s stock will come from better margins due to an improved product mix as well as higher dividend payout ratios. Downside risks include a spike in input prices such as for robusta coffee beans, palm oil and sugar.

1246 (0446 GMT)

(Reporting by Leonard How; leonard.how@thomsonreuters.com)

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12:43 STOCKS NEWS SINGAPORE-Yangzijiang contract termination may weigh-DBS

Yangzijiang Shipbuilding (Holdings) Ltd has terminated a contract with Greek shipowner FreeSeas Ltd after it failed to make payments, which may weigh on its stock price, DBS Vickers said.

The cancelled contract was for Yangzijiang to build two bulk carriers for FreeSeas, an external spokeswoman for the Chinese shipbuilder said.

Although the orders from FreeSeas account for only 1 percent of Yangzijiang’s $4.5 billion order book, “the cancellation will still be negative on sentiment as this is Yangzijiang’s first contract cancellation on default,” said DBS Vickers in a report.

It added that among the Singapore-listed shipyards, COSCO Corp Singapore Ltd has the highest exposure to Greece and Europe, with more than 60 percent of its order book from the region, while Yangzijiang will be the least affected among Chinese yards.

DBS advised investors to avoid COSCO’s shares, which are likely to underperform the market on concerns about their European exposure.

At 0419 GMT, shares of Yangzijiang were unchanged at S$1.045, while COSCO has fallen about 1 percent to S$0.995.

“We believe the cancellation is a reflection of tightening in ship financing as European banks become more selective in lending, while Chinese banks have not stepped in to fill the gap,” said Credit Suisse, which has an outperform rating and target price of S$1.60 on Yangzijiang.

The brokerage estimates that only about 5 percent of Yangzijiang’s order book consists of bulk carrier orders from Europe-based customers.

1221 (0421 GMT)

(Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com)

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11:07 STOCKS NEWS SINGAPORE-STX OSV shares up 3 pct on order wins

Shares of Singapore-listed shipbuilder STX OSV Holdings Ltd rose as much as 3 percent after it won two contracts worth 700 million Norwegian crowns ($118.1 million) to build two platform supply vessels.

Shares of STX were up about 2 percent at S$1.55 at 0301 GMT and have risen 34 percent so far this year.

“We believe that order momentum in the North Sea underscores robust sector dynamics, despite ongoing Euro concerns,” CIMB Research said.

The contracts bring the shipbuilder’s order wins so far this year to 6.7 billion Norwegian crowns, two-thirds of the broker’s total order target for fiscal 2012.

CIMB Research kept its target price of S$2.09 on STX OSV and maintained its ‘outperform’ rating, saying it liked the company for its high-end capabilities, market leadership and entrenchment in Brazil.

For a company statement, click

1100 (0300 GMT)

(Reporting by Leonard How in Singapore; leonard.how@thomsonreuters.com)

($1 = 1.2660 Singapore dollars)

$1 = 5.9293 Norwegian krones

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