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The Week Ahead: High Expectations For OCBC Results

It’s been “steady as she goes” as far the Singapore earnings season is concerned. Let’s hope we can get more of the same when three more Singapore blue chips step into the spotlight.  

Hutchison Port Holdings  (SGX: NS8U) will report third-quarter numbers on Monday. In July the port operator posted a 21% drop in earnings. It also cut the distribution per share from 14 HK cents to 9.5 HK cents. Revenue only fell 1.5%, though. But it was losses at associated companies that did the damage. With global trade picking up, HPH might have better news for income investors.  

Ahead of results on Wednesday, Singapore Exchange  (SGX: S68) said it has expand its footprint to the US with the opening of SGX Chicago. SGX said a presence in America will help it to better serve a growing client base in the region. In July, SGX reported an 11% rise in fourth-quarter earnings. It said there were better performances from its securities trading and clearing, as well as its derivatives divisions. The market is looking forward to more of the same.  

Oversea-Chinese Banking Corporation  (SGX: O39) will report third-quarter earnings on Thursday. Singapore’s second-largest bank said in July that net profits jumped 22% compared to a year ago. Its better-than-expected numbers were boosted by wealth management and insurances businesses. This time it could be improving net interest income that might be driving bottom-line profits.  

On the economic front The  European Central Bank has an interest-rate decision to make on Thursday. No prizes for guessing that experts don’t believe there will be a change in the cost of borrowing. ECB Policymakers have said that the economy still requires a substantial amount of monetary easing to support inflation. So, it looks like no respite yet for savers with money in the bank.  

The UK economy grew at its slowest annual rate since the second quarter of last year. The cause was a slowdown in consumer spending and a reduction in investment by businesses. The uncertainty surrounding Brexit and a possibility that the Bank of England could start raising interest rates could be why. What will be the excuses this time, when the UK reports GDP numbers on Wednesday?  

China’s week-long Communist Party Congress will have ended by the time the country reports its latest house price index. The president of China, Xi Jinping, took aim at property speculators in his address to the Congress. He said housing should be for living in, not speculation. China’s House Price Index, which measures average prices in 70 Chinese cities, rose at the slowest rate for 15 months last time. But they still rose 8.5% year-on-year.

Other key events next week include Japan and Singapore inflation numbers, and the small matter of a general election in Japan, when Prime Minister, Shinzo Abe, is expected to be returned to power by Monday morning.

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