Amazon.com briefly joined Apple in the trillion dollar club on Tuesday when its shares hit a high of US$2,050.50 apiece. Although the share price has since dipped back to US$1,994 (as of 6 September), it still marked a historic accomplishment for chief executive, Jeff Bezos, who founded the company as a small online book seller a mere 24 years ago. Bezos is now the world’s wealthiest person, with Amazon.com a diversified enterprise that has more than US$200 billion in annual sales and more than 575,000 employees. Amazon shares have more than tripled since 2015 and are up more than 500 times the IPO price, after accounting for share splits.
Share buybacks in Singapore reached a 35-month high in August as 43.6 million shares worth S$245.4 million were repurchased by 30 companies. The total value is more than twice July’s buyback consideration of S$109 million. It also represents a four-fold increase from August 2017. Managers can use share buybacks to reduce the number of outstanding shares in the market. They are usually carried out when managers believe that the stock prices are below their intrinsic value.
DBS Group Holdings Ltd (SGX: D05) led the August share buyback, repurchasing 5.95 million shares for S$150.8 million. DBS and four other index stocks — CapitaLand Limited (SGX: C31), United Overseas Bank Ltd (SGX: U11), Oversea-Chinese Banking Corp Limited (SGX: O39) and City Developments Limited (SGX: C09) — bought back a total of S$230.2 million worth of shares. Outside of the index, HRnetGroup Ltd (SGX: CHZ) had the biggest buyback consideration of 2.4 million shares for S$2.2 million.
Meanwhile, Indonesia will raise import taxes on more than 1,000 goods to support a weak rupiah. The rupiah dipped to its lowest level since the Asian financial crisis this week, closing at Rp 14,930 per US dollar on Wednesday. Indonesia’s stock market fell the most in almost two years. The currency has been one of emerging Asia’s worst performers as investors sell assets amidst fears of US rate rises and contagion from crises in Argentina and Turkey. The total value of imported goods that will be affected by the tariffs is estimated to be worth US$5 billion in the first eight months of this year and US$6.6 billion in the whole of 2017.
According to a poll, private-sector economists expect the Singapore economy to grow by 3.2% in 2018, which is within the Government’s forecast range of 2.5% to 3.5%. The poll, which reflects the views of 23 economists, showed that they expect manufacturing to grow by 7.6%, accommodation and food services by 2.9%, finance and insurance by 6.7%, and wholesale and retail trade by 1.5%. The only sector that is expected to show lack of growth is the construction sector. The forecast for growth in non-oil domestic exports this year was a robust 5%.
Economists, however, warned that downside risks include the escalation of trade conflict between the United States and China, and slower growth in China due to tightening credit conditions.
Property prices in Australia have fallen for the 11th consecutive month in August. Prices dropped 0.3% in August, due to declines in Sydney and Melbourne. Prices in Sydney have fallen 5.6% from a year ago.
Finally, the high-speed rail project between Singapore and Kuala Lumpur has been shelved for another two years as Malaysian Prime Minister Mahathir Mohamad seeks to address his nation’s debt. The two countries have agreed to delay construction work on the 350-kilometre link until the end of May 2020. The first train is only expected to start service after January 2031, four years later than initially planned. As compensation for the delay, Malaysia has to pay Singapore S$15 million by January 2019.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has a recommendation on Amazon.com, Apple, DBS Group Holdings Ltd, United Overseas Bank Ltd and HRnetGroup Ltd. Motley Fool Singapore contributor Jeremy Chia owns shares in HRnetGroup Ltd and DBS Group Holdings Ltd.