Singapore shares were slightly lower at midday, weighed by property firms, as investors waited on the sidelines for more signs of progress in resolving the U.S. “fiscal cliff” budget crisis.
Property developers were among the biggest losers, with City Developments Ltd falling 2 percent to S$12.94, while CapitaLand Ltd dropped 1.6 percent to S$3.61.
However, commodity companies such as Noble Group Ltd rose 2.6 percent to S$1.18, and Olam International was up 1.4 percent at S$1.495.
In a stock exchange filing, Olam said Singapore state investor Temasek had raised its stake in the commodity trader to 17 percent from 16.99 percent.
OCBC Investment Research said more privatisation of Singapore residential property companies could happen, such as Wheelock Properties (Singapore) Ltd and Ho Bee Investment Ltd, which are both trading at attractive levels of 0.79 times and 0.76 times respectively, and have relatively small free floats.
“Given the current environment of low borrowing costs and steep trading discounts to restated net asset value for high-end developers, it is likely that a spate of privatisation activity lies ahead,” said OCBC.
The brokerage forecasts mass market home prices to rise by up to 5 percent in 2013, while high-end home prices could fall by up to 10 percent next year.
1137 (0337 GMT) (Reporting by Charmian Kok in Singapore; Editing by Prateek Chatterjee; email@example.com)
10:48 STOCKS NEWS SINGAPORE-Macquarie Intl Infrastructure rises
Units of Macquarie International Infrastructure Fund Ltd (MIIF) rose as much as 3.2 percent after it announced a one-off special dividend following a strategic review.
By 0239 GMT, MIIF units were traded at S$0.645 and have risen 21.7 percent since the start of the year.
After a strategic review done by MIIF’s board, it decided to implement certain initiatives such as distributing existing excess cash to shareholders as a one-off special dividend and seek to divest some of its assets.
“MIIF’s latest move should enable the fund to further realise its net asset value given the decent quality of the remaining underlying assets, but no timeline has been set to avoid any impression of a fire-sale,” said DMG & Partners in a note.
DBS Vickers raised its target price on MIIF shares to S$0.65 from S$0.58 and kept its ‘hold’ rating on expectations investors could receive a special dividend of 3 Singapore cents, on top of a final dividend of 2.75 Singapore cents for the second half of 2012.
However, it noted that it could be difficult and time consuming for MIIF to realise the true values of its investments, given the uncertainties involved in the process.