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It’s a Wrap: The Top 3 and Bottom 3 Blue-Chip Stocks for July

The Straits Times Index (SGX: ^STI), which tracks the performance of the top 30 largest and most liquid companies listed in Singapore, ended July in the green. For the month, the index rose 1.6%, or around 51 points, to 3,320. The increase was despite it falling 2%, or 65 points, on 6 July after the Singapore government announced additional property cooling measures a day before.

Of the 30 index components, 20 were in the positive territory; one was flat while the remaining nine were in the red. The company that ended the month unchanged was ComfortDelGro Corporation Ltd (SGX: C52).

The top three winners of the Straits Times Index were Singapore Press Holdings Limited (SGX: T39), Jardine Strategic Holdings Limited (SGX: J37) and Jardine Matheson Holdings Limited (SGX: J36).Source: S&P Global Market Intelligence (stock prices for the Jardines have been converted to Singapore dollars from US dollars)

Singapore Press Holdings, on 11 July, announced its financial results for the third quarter ended 31 May 2018. It posted operating profit growth of 29.6% year-on-year to S$44.4 million while net profit rose 64.3% to S$47.4 million. For more on the financial performance, you can head here.

Jardine Strategic is a holding company with long-term strategic investments in multinational businesses. Jardine Strategic owns 58% of Jardine Matheson, with Jardine Matheson, in turn, having an 84% stake in Jardine Strategic.

For the six months ended 30 June 2018, Jardine Matheson’s revenue was 14% higher at US$21.4 billion, while gross revenue, which includes 100% of associates and joint ventures, improved 19% year-on-year to US$44.3 billion. However, net profit tumbled 57% to US$928 million. Excluding non-trading items, underlying net profit would have increased 6% to US$792 million.

Sir Henry Keswick, chairman of the conglomerate, said:

“After a good performance in the first half of 2018 driven primarily by Astra and Jardine Cycle & Carriage, we are optimistic for a stronger second half of the year, with these companies continuing to perform well and the contributions of other businesses expected to improve.”

On the other hand, the top three losers of the index were Hutchison Port Hldg Trust (SGX: NS8U), City Developments Limited (SGX: C09) and Golden Agri-Resources Ltd (SGX: E5H).Source: S&P Global Market Intelligence (stock price for Hutchison Port has been converted to Singapore dollars from US dollars)

Hutchison Port had a weak second quarter. For the three months ended 30 June 2018, revenue and other income decreased by 3.6% year-on-year to HK$2.79 billion while net profit fell by 36.8% to HK$170 million. The lower profit was on the back of lower container throughput at its Hong Kong and Shenzhen ports.

Looking ahead, the trust mentioned:

“The level of uncertainty in political and economic relations as it pertains to trade has increased significantly over the course of the year to date and shows little sign of abating. The impact of measures which may arise out of the trade disputes, especially those between the United States and China, on the performance of HPH Trust for the remainder of the year cannot readily be quantified given the level of uncertainty that currently prevails as to both the specific nature; extent; and timing of such measures and the consequent precise impact they may have on local and global trade flows and, as such, HPH Trust’s business.”

Property company, City Developments, saw its shares hit hard in July due to the additional property cooling measures. My Foolish colleague, Jeremy Chia, took a dive into the company’s business and whether the share price decline was warranted. You can check out his article here.

Golden Agri-Resources will be announcing its financial results for the 2018 second-quarter on 14 August.

For the first quarter, which ended on 31 March 2018, revenue slumped 11.3% year-on-year to US$1.8 billion while net profit plummeted 68.4% to US$11.9 million. The company’s chairman and chief executive, Franky Widjaja, said the following about the results and Golden Agri-Resources’ long-term prospects:

“First quarter 2018 was a challenging period for the palm oil industry. Industry experts are also concerned about a production surplus in the second half of the year, due to seasonality and low production in the first quarter. However, we believe CPO [crude palm oil] prices will be supported by growing food demand as well as from increasing biodiesel usage. Over the long term, we believe demand for palm oil will remain strong, and the industry is well positioned to ride out occasional periods of volatility.”

The SPDR STI ETF (SGX: ES3), an exchange-traded fund which can be taken as a proxy for the Straits Times Index, was valued at a price-to-earnings ratio of 11.8 and had a distribution yield of 3% on 31 July 2018.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.