The Week Ahead: OCBC, Venture and Sembcorp Industries

Some solid numbers from United Overseas Bank (SGX: U11) has set the bar for Oversea-Chinese Banking Corporation (SGX: O39), which is pencilled in for third-quarter numbers next week.

In August, OCBC said second-quarter profits jumped 16% to S$1.21 billion. But it warned that the operating environment is becoming increasingly challenging. It also said that it was watchful of the severe implications to the global economy and financial markets from the escalating trade and political tensions.

Venture Corporation (SGX: V03) surprised the market last time with a 40% jump in second-quarter profits. The electronics manufacturer also caught the market off guard with the announcement of an interim dividend. It typically only pays one dividend at the end of the year. But in its August announcement, Venture said that some volatility could arise in the near term from the possible of escalation of the trade war and component shortages.

Disappointing results from Sembcorp Marine (SGX: S51) could weigh on Sembcorp Industries (SGX: U96), which will report third-quarter numbers. In August, the industrial conglomerate said net profits rose 46% to $81.9 million. Whilst profit from utilities swelled and urban development outperformed, the group’s marine business was a drag.

On the economic front, it is time for those US non-farm payroll numbers again. In September 134,000 jobs were created, but that was below expectation. The US will also report its unemployment rate for October, which is expected to be unchanged at 3.7%.

China will have some key Purchasing Managers’ Indices to report. They are expected to still show expansion in manufacturing and services but at slightly reduced levels.

The Eurozone will report flash GDP numbers which could indicate a slight rise in year-on-year economic growth. Elsewhere, there could a sign of a slight pickup in the rate of inflation, when those flash numbers are released.

The UK government will announce its Autumn Budget, which would be the last one before Brexit. The Budget will be followed later in the week by an interest-rate decision by the Bank of England. The base rate is expected to remain at 0.75%.

The Bank of Japan also has an interest-rate decision to make. This is expected to remain unchanged at -0.1%.

And finally, Singapore will report bank lending numbers for September. This is expected to show a slight increase from S$669.9 billion to S$671.1 billion.

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