Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on changes – just in case they’re material to our investing thesis. The Straits Times Index (SGX: ^STI) has declined by 0.9% to 3,344 points with only five of its 30 constituents ending the day with gains; a total of 21 blue chips had suffered losses, dragging the STI down into negative territory. At this point, I’d usually start talking about three shares that happened to beat the market. But, there’s a special development in our local share…
Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on changes – just in case they’re material to our investing thesis.
The Straits Times Index (SGX: ^STI) has declined by 0.9% to 3,344 points with only five of its 30 constituents ending the day with gains; a total of 21 blue chips had suffered losses, dragging the STI down into negative territory.
At this point, I’d usually start talking about three shares that happened to beat the market. But, there’s a special development in our local share market today that bears mention. In a joint press-release by the Monetary Authority of Singapore and the stock exchange operator Singapore Exchange Limited (SGX: S68), the following was revealed:
“To improve retail investors’ access to a broader range of listed securities, particularly blue-chip stocks, SGX will reduce the board lot size for securities listed on SGX from the existing 1,000 shares to 100 shares in January 2015. SGX will announce details of this initiative by end-August 2014.”
I’ve been waiting for this development for a long while (as are my colleagues!) as it would greatly enhance the affordability of shares with huge price tags for individual investors. The changes can allow individual investors the ability to build a portfolio based on consideration of a share’s valuation rather than its price alone. As my colleague David Kuo once wrote:
“Investing should be for everyone and not just for those who have piles of cash at their disposal.”
That’s all for the special update. Now back to the three shares that have done better than the STI.
Hongkong Land Holdings Limited (SGX: H78) is up 1.2% to US$6.93 following the release of its half-year results yesterday. For the six months ended 30 June 2014, the property developer and owner saw its revenue drop by one-third from US$912 million a year ago to US$602 million. Meanwhile, its profit dipped by only 6% to US$563 million.
The bulk of the decline had been due to a weaker residential property market in Singapore and China (both countries are key geographical markets for the company’s residential property development business). Fortunately, Hongkong Land’s portfolio of commercial properties had helped to pick up some of the slack with a strong performance. For instance, the company’s “average office rent increased to HK$103 per sq. ft from HK$97 per sq. ft and HK$101 per sq. ft in the first and second half of 2013, respectively.”
The following are comments on Hongkong Land’s outlook given by its Chairman Ben Keswick:
“The solid performance in the Group’s commercial portfolio is set to continue in the second half, while the contribution from our residential business will show improvement as it benefits from the final sales at Serenade as well as further completions in mainland China and Singapore.”
Despite seeing a decline in both its top- and bottom-line in its latest half-year earnings released yesterday, Singapore Exchange Limitedmanaged to climb by 1.6% to S$7.17. The company’s revenue dropped by 4% to S$686.9 million compared to a year ago while profit slipped by 4.6% to S$320.4 million.
Southeast Asia’s largest bank DBS Group Holdings Ltd (SGX: D05) rounds up the trio. It has inched up by 0.5% to S$18.31 after proudly revealing that its net profit has crossed S$2 billion for the first time in the first-half of a year.
For the six months ended 30 June 2014, the bank’s total income (analogous to ‘revenue’ for other types of companies) increased 3% year-on-year to S$4.76 billion while net profit was up 9% to S$2.0 billion.
The bank’s top-line growth had been underpinned by a healthy 12% increase in net interest income to S$3.05 billion “as loan and deposit volumes grew and net interest margin improved three basis points to 1.66%.”
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