SINGAPORE, Oct 29 (Reuters) - Shares of Singapore
Telecommunications (SingTel) (STEL.SI), Southeast Asia's
largest telecom, fell as much as 4.2 percent on Wednesday after
UBS cut its price target for the stock to S$3.46 from S$4.60.
"There is no safe haven right now, once the markets tank,
everything is going to come down, even the most defensive
counters," said a Singaporean trader.
The selling came after SingTel closed around 17 percent
higher on Tuesday.
UBS analysts said in a report SingTel may continue to face
pressure in the near term on weaker earnings contributions from
subsidiaries and negative investor sentiment towards emerging
market exposure.
By 0602 GMT, SingTel's shares were down 3.3 percent,
trading at S$2.33, underperforming the benchmark Straits Times
Index .FTSTI which was flat.
OCBC
Shares of Overseas-Chinese Banking Corp (OCBC.SI) fell 1.8
percent on Wednesday, bucking gains by other lenders on
concerns its performance will be hurt by insurance arm Great
Eastern (GELA.SI).
Around 0350 GMT, OCBC was down 1.8 percent compared with
gains of 3.3 percent by United Overseas Bank (UOBH.SI) and 6.3
percent by DBS Group (DBSM.SI) percent.
DBS is not involved in insurance while UOB's insurance
business is relatively small compared with Great Eastern, the
largest life insurer in Singapore and Malaysia.
RBS analyst Trevor Kalcic, who has a "hold" recommendation
on OCBC and "buy" calls on DBS and UOB, said OCBC had poorer
earnings visibility.
"The group's life insurance earnings are being weighed down
by expanding credit spreads and some other life insurance
peculiarities," he wrote.
OCBC's "relative over-valuation versus DBS limits upside
potential in our view," he added.
A trader with a local brokerage said the Singapore banks'
share price movements also reflected a correction of previous
price changes, noting government-linked DBS had fallen much
more than the two family-controlled lenders.
The benchmark Straits Times Index .FTSTI was up 1.46
percent.
REITS
Shares of Singapore real estate investment trusts (REITs)
rose on Wednesday, helped by improved sentiment after
Malaysia's YTL Corp bought a 26 percent stake in Macquarie
Prime REIT MMPR.SI at a more-than-50-percent premium.
"YTL's investment indicates there are investors who are
confident in the longer-term prospects of Singapore property,"
Goldman Sachs said in a report.
"We view this development as positive for Macquarie Prime
REIT and for the Singapore REIT sector."
Around 0210 GMT, CapitaCommercial Trust (CACT.SI) was up
6.8 percent, while CapitaMall Trust (CMLT.SI) was 7.3 percent
higher.
Macquarie Prime was flat at 54 Singapore cents after
gaining as much as 9.3 percent earlier in the session.
YTL, a property and infrastructure conglomerate, said on
Tuesday it will buy 26 percent of Macquarie Prime and 50
percent of the REIT's management firm for S$285 million. The
price of S$0.82 a unit represents a 52 percent premium to the
REIT's last traded price and a 49 percent discount to book
value.
The benchmark Straits Times Index .FTSTI was up 1.8
percent.
(Reporting by Laurence Tan and Ramya Jaidev; Editing by Kevin
Lim and Saeed Azhar)
