Tag Archive | "SGX"

SGX strengthens risk management team with new appointments

Singapore Exchange (SGX) has strengthened its Risk Management and Regulatory team with new appointments.

Mr Richard Teng has been appointed as Head of Regulation.

He’s responsible for overseeing Issuer Regulation, Catalist Regulation, Member Supervision, Market Surveillance and Enforcement.

Mr Teng will closely support Ms Yeo Lian Sim, the Chief Regulatory officer, to fulfil and uphold SGX’s regulatory standards.

Mr Kelvin Koh has been appointed Head of Market Surveillance while Ms Annie Ong will be Acting Head of Enforcement.

Ms Agnes Siew has been appointed as Head of Clearing Risk and is responsible for the formulation of risk frameworks for new products and services.

The former Regulatory Policy unit has been expanded to include legal functions related to regulation in order to provide a more holistic perspective in regulatory formulations.

The Regulatory Development & Policy function will be headed by Mr Mohamed Nasser Ismail.

SGX said the changes are effective from July 1 this year, to maintain robust regulation in today’s rapidly changing financial landscape.

Adapted from CNA (By Stella Lee and Jonathan Peeris)

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Singapore Stocks Updates: Ezion Holdings, Hi-P, Keppel Corp., Wilmar

Singapore’s Straits Times Index dropped 0.5 percent to 3,005.28 at the close, the lowest since March 22. Almost six stocks fell for each that rose in the benchmark index of 30 companies. The gauge sank 2.4 percent this week.

Shares on the measure trade at an average 13.8 times estimated earnings, compared with about 15.6 times at the end of 2010, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Oil-rig builders: Keppel Corp. (KEP SP), the world’s biggest supplier of oil platforms, slid 1.9 percent to S$10.44. Smaller rival Sembcorp Marine Ltd. (SMM SP) lost 0.6 percent to S$5.21.

Crude oil futures dropped to the lowest in four months in New York on concern the Greek debt crisis will threaten Europe’s economic recovery, curbing fuel demand.

Ezion Holdings Ltd. (EZI SP), a provider of marine logistics and support services, climbed 1.6 percent to 65.5 Singapore cents. DMG Partners Securities Pte reiterated its “buy” rating on the stock, saying a $73 million contract won by the company’s joint venture with Treatmil Holdings Ltd., a European offshore services company, will boost earnings next year.

Hi-P International Ltd. (HIP SP), a contract manufacturer whose clients include BlackBerry-maker Research in Motion Ltd., dropped 1 percent to S$1 after Canada-based RIM said quarterly revenue may drop for the first time in nine years.

Wilmar International Ltd. (WIL SP), the Singapore-based agribusiness company, climbed 2.1 percent to S$5.44. Amyris Inc., a U.S. biotechnology company, said it will collaborate with Wilmar to develop surfactants, compounds that are used in consumer and industrial products, as part of plans to expand into Asia.

Adapted from Bloomberg & Hearst.

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ASEAN Exchanges a step closer to trading interconnectivity

Four exchanges in ASEAN – Bursa Malaysia (BMB), The Philippine Stock Exchange (PSE), Singapore Exchange (SGX) and the Stock Exchange of Thailand (SET) – today said that they have made progress toward achieving interconnectivity amongst their respective markets as part of the broader ASEAN Exchanges Collaboration.

After its previous announcement of electronic trading platform, ASEAN Exchange today further enforces its trading interconnectivity, for which may pose a threat to HKEx and Tokyo Trading?

There has been a concern in difference between ASEAN that structure and technology of Singapore Exchange (SGX) excels amongst them, which may lead to competition for customers. But now, the enhancement of trading interconnectivity lets it leap.

Today, the four exchanges have appointed SunGard as the technology provider of the business-to-business intra-ASEAN cross-border order routing and trading platform that will electronically connect the markets of participating exchanges and allow investors and broker members to access multiple markets via a single connection. The platform is expected to go “live” by the end of the first quarter of 2012.

Dato’ Tajuddin Atan, Chief Executive Officer of Bursa Malaysia said: “The ASEAN trading link is an important development in enabling our markets to create greater ASEAN investment mobility amongst intermediaries namely the broker members and information vendors. This forms an integral part of the various initiatives in achieving the overall objective of the ASEAN Exchanges Collaboration to promote the growth of the ASEAN capital market.”

“The ASEAN trading link will facilitate global trades especially for retail investors seeking a bigger exposure in a fast growing ASEAN market,” said Mr Hans B. Sicat, President and CEO of PSE.

Mr Magnus Bocker, CEO of SGX, said, “We are pleased with the development of the ASEAN trading link which will enable investors to easily trade across markets in this region, the combined GDP growth of which is expected to average 6% annually across the ASEAN countries over the next 5 years. We expect this link will drive greater liquidity and investment mobility in ASEAN.”

Mr Charamporn Jotikasthira, President of SET said, “Signing the agreement with SunGard today is another milestone achieved for the ASEAN link project. However, technology alone is not sufficient to make this project a success. The ASEAN Exchanges will work together on marketing initiatives to promote the ASEAN link and the ASEAN asset class. Among others, there will be a networking event to promote cross-border partnerships among ASEAN brokers in Phuket in July.”

Adapted from Quamnet

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Emerging-Market Stocks Slump to Three-Month Low on Rates, Greece

Emerging-market stocks fell to a three-month low as concern deepened that Europe’s debt crisis and rising interest rates in developing nations will curb global economic growth.

The MSCI Emerging Markets Index dropped 1.8 percent to 1,107.43 at 5:30 p.m. in New York, the lowest since March 18. China’s Shanghai Composite Index sank 1.5 percent, while India’s Bombay Stock Exchange Sensitive Index lost 0.8 percent and South Korea’s Kospi dropped 1.9 percent. Brazil’s Bovespa index lost 1.2 percent and Russia’s Micex fell 0.5 percent.

Equities in Poland, the Czech Republic and Hungary sank, while east European currencies weakened as violence erupted in Greece over budget cuts. The Shanghai composite tumbled to the lowest level since September after the Economic Information Daily said in a front-page editorial that an interest-rate increase in China isn’t “far away.” The Sensex extended this year’s drop to 12 percent after India’s central bank raised borrowing costs for the 10th time since the start of 2010.

“Governments are walking a fine line between growth and social obligations,” said Lye Thim Loong, who helps manage about $770 million at Avenue Invest Bhd. in Kuala Lumpur. “Cheap money for funding businesses will eventually dry up.”

The MSCI gauge of emerging markets has fallen 3.8 percent this year, compared with a 0.5 percent slide in the MSCI World Index of developed-nation stocks. Shares in the MSCI emerging index are valued at 10.1 times analysts’ 12-month earnings estimates, the lowest level since March 2009, according to data compiled by Bloomberg.

Industrials and Financials

Industrial and financial stocks were among the biggest decliners on the MSCI emerging gauge today. Hyundai Heavy Industries Co., the world’s biggest shipbuilder, slumped 4.3 percent. China Construction Bank Corp., the world’s second- largest lender by market value, plunged 4.8 percent in Hong Kong.

The Czech PX index retreated 1 percent and Hungary’s benchmark BUX index of shares dropped 0.7 percent. Poland’s zloty weakened 0.9 percent against the euro after the International Monetary Fund said yesterday that Hungary’s government may breach the European Union’s budget-deficit limit next year.

Banco do Brasil SA, Latin America’s biggest bank by assets, lost 2 percent, the most in a month, as traders raised bets for higher borrowing costs and concern mounted that proposed international regulations may subject banks to capital surcharges if they grow any bigger. Miner Vale SA followed metal prices lower and oil company OGX Petroleo e Gas Participacoes SA fell for the fifth day in Brazil.

Yield Spread

The extra yield investors demand to own emerging-market debt over U.S. Treasuries rose five basis points, or 0.05 percentage point, to 321, according to JPMorgan Chase Co.’s EMBI Global Index.

Greek Prime Minister George Papandreou will reshuffle his Cabinet today and seek a confidence vote, battling to control a shrinking majority and pass austerity measures demanded by international lenders. Police used tear gas to break up protests in central Athens last night.

Irish Finance Minister Michael Noonan said yesterday senior bondholders should share in the losses of Anglo Irish Bank Corp. and Irish Nationwide Building Society, reversing a policy of protecting owners of senior securities.

Adapted from Bloomberg

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SGX downplays size after failed ASX exchange deal

Singapore Exchange Ltd (SGXL.SI) CEO Magnus Bocker, whose takeover of market operator ASX Ltd (ASX.AX) was blocked by the Australian government earlier this year, warned on Friday that size alone will not determine which bourses ultimately succeed.

Bockner, speaking at a conference hosted by Sandler O’Neill, also said it was a bit “sad” from Australia’s perspective that the door was closed to the planned cross-border tie-up.

“There is a danger if you think that scale is survival,” he told reporters after his presentation. “Size will never be the single winner in this.”

Bocker was less than enthusiastic about the current round of merger mania in the exchanges space, telling reporters that Singapore is “focusing on organic growth.”

Singapore Exchange Ltd (SGX) in April withdrew its bid for Australia’s ASX Ltd after the government there blocked it, illustrating the hurdles to such cross-border deals for bourses.

This sparked talk that SGX could look to Nasdaq OMX Group Inc (NDAQ.O) or London Stock Exchange Group Plc (LSE.L) as possible partners.

Adapted from Reuters ( By Maria Aspan and Jonathan Spicer )

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SGX to clear Asian FX Forwards

The Singapore Exchange (SGX) is set to become the first bourse in the world to start clearing Asian Foreign Exchange Forwards (FX Forwards) when it makes the service available by September this year.

SGX said the clearing of Asian FX Forwards would include the non-deliverable currencies traded in the region.

These are the Chinese yuan, Indonesian rupiah, Indian rupee, Korean won, Malaysian ringgit, Philippine peso and Taiwanese dollar.

SGX said the initiative is in line with recent global regulations on mandatory clearing for non-deliverable FX forwards and FX options via a central counter party.

This latest over the counter clearing comes after the exchange started clearing of interest rate swaps denominated in Singapore dollars last year.

SGX said it has cleared nearly US$80 billion of interest rate swaps since the launch.

The new clearing service is expected to enhance Singapore’s position as a market for trading of interest rate derivatives and foreign exchange.

So far, 11 SGX clearing members are eligible to clear FX Forwards.

They include Barclays Bank, Citibank, DBS Bank, HSBC, OCBC and UOB among others.

SGX said it expects the membership to grow in the months ahead with membership interest from all banks active in these products.

Meanwhile, SGX has proposed two initiatives to improve market transparency and enhance price discovery through changes in the pre-opening and pre-closing routines.

In a separate announcement, SGX said the first proposal will involve the publication of real-time Indicative Equilibrium Prices (IEP), throughout the pre-open and pre-close phases.

This is for market participants to better assess market demand and supply conditions, and adjust their orders accordingly.

IEP is the price at which orders would be executed if auction matching were to occur at that point. With the proposal, the IEP would form the opening or closing price.

At the moment, investors can only see the aggregate buy and sell quantities at the various bid and offer prices.

SGX also proposed to have a random end to the pre-close phase for a varying duration between four and five minutes. Currently, this is a fixed duration of five minutes after the trading session.

The end of the pre-close phase will be synchronised across all counters.

The varying time period protects the integrity of the closing price against the impact of sudden large entry and withdrawal orders.

The proposals are open to feedback until June 15.

Adapted from CNA (By Millet Enriquez)

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Singapore Exchange: Singapore inflation slows to less than 5% for first time in 2011 Share

Singapore’s inflation slowed to less than 5% for the first time this year in April as a strengthening currency reduced the cost of imported goods.

Consumer prices rose 4.5% last month from a year earlier, the Department of Statistics said in a statement today. That was the slowest pace in five months, according to data compiled by Bloomberg based on previously released information, and compares with the 4.4% median estimate of 11 economists surveyed by Bloomberg News.

Asian central banks from China to Thailand and India have raised interest rates or allowed their currencies to gain to curb price pressures as oil and food costs rise. Singapore’s dollar rose to records after the central bank said April 14 it would allow further appreciation in its third tightening of monetary policy in a year.

“Singapore’s inflationary pressures remain high,” Pay Shuzhen, a Singapore-based economist at Australia & New Zealand Banking Group, said before the report. “With a tightening labor market, high commodity prices and housing costs, inflation will continue to rise.”

Prices rose 0.3% last month from March, without adjusting for seasonal factors, today’s report showed. A core inflation measure that excludes accommodation and private road transport showed prices climbed 2.2% in April from a year earlier, the statistics department said.

Singapore raised its growth forecast for 2011 last week after the island’s economy expanded the most in Southeast Asia in the three months through March. Gross domestic product will increase 5% to 7% this year, the trade ministry said May 19.

POLICY TIGHTENING
The Monetary Authority of Singapore, which uses the exchange rate as its main tool to manage inflation, said last month it will re-center the currency’s band higher.

Singapore’s inflation may have peaked and a stronger currency has helped damp price gains, central bank Managing Director Ravi Menon said May 18. The monetary authority forecasts inflation will average 3% to 4% this year.

The Singapore dollar has gained more than 13% against the U.S. currency in the past year to be the best performer in Asia excluding Japan. It traded at $1.2452 a dollar at 12:54 p.m. local time.

Pressure on consumer prices may increase in the coming months after Singapore Power, the island’s main electricity provider, increased tariffs for the April-to-June quarter by an average 6.5% because of higher oil costs.

Adapted from i3investor & Bloomberg

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Singapore exchange’s McMahon to resign in June

Singapore Mercantile Exchange Sunday said its chief executive, Thomas McMahon, has resigned and will leave his post at the end of June.

The exchange, which commenced operation in August last year, said in a statement McMahon “has decided to move on to pursue his personal interests within the industry, and will do so from Singapore.”

It also said McMahon “will continue to serve SMX until end of June 2011 and will thereafter continue his association with SMX as a member of the Advisory Board of SMX.”

Singapore’s The Sunday Times, citing unnamed sources, said McMahon left the SMX on Friday over “strategy differences” with SMX parent company Mumbai’s Financial Technologies (India) Ltd. (526881.BY). The SMX statement did not elaborate on McMahon’s reasons for resigning but said it is in the process of finding a new CEO.

McMahon, who joined SMX in April 2009, was previously president of the Hong Kong Mercantile Exchange and director of Asia for the New York Mercantile Exchange.

Adapted from MarketWatch (By Sam Holmes)

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Time to introduce S-Chip investor protection measures: SIAS

The time is now ripe for Singapore to introduce strict measures that will protect the investments of retail investors in S-Chips, according to David Gerald, president and CEO of Securities Investors Association Singapore (SIAS).

Mr Gerald’s comments came as S-Chips investors face another prospect of losing their investments after mainboard-listed China Milk Products Group is found by special auditors KPMG to have several irregularities in its transactions.

In a report dated June 7 by KPMG, China Milk is also found to have made significant payments without board approval and documentation.

SGX said it released the KPMG report after China Milk’s audit committee “did not take prompt action”. The exchange said this is despite a reminder to release the report by 5pm on June 9.

Meanwhile, SIAS said it has made representations to the Singapore Exchange to consider putting safeguards in place, so that money raised from Singapore market is not siphoned off to dodgy deals. It added that its suggestions are being considered by SGX.

On April 5 last year, Singapore Exchange directed China Milk to appoint a Special Auditor immediately to investigate the affairs of the company. The reason for this special course of action was because China Milk failed to release the findings of a cash audit that it was instructed to do earlier last year.

On February 12 last year, China Milk announced that it was in default on its Convertible Bonds as it was unable to meet repayment obligations amounting to US$170 million.

The company had previously said the delay in repayment was due to the process of obtaining approval for the remittance of funds out of China from China’s State Administration of Foreign Exchange (SAFE).

China Milk had then said the process was administrative and procedural in nature.

Adapted from CNA (By Julie Quek)

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ETF Turnover Up 85% On-Year in Last Five Months

ETF turnover up 85% on-year in last five months

Turnover for exchange traded funds (ETFs) grew 85 per cent on-year in the last five months, according to the Singapore Exchange (SGX).

And most recently, ETFs have accounted for 10 to 15 per cent of overall trading volume on the exchange – reaching 92 million units in the month of May.

Investment firms like BlackRock are seeing tremendous potential for such passive income investments in Asia and has launched two more ETFs on the SGX on Thursday.

The SGX saw over a billion dollars worth of ETFs changing hands in the month of May, according to its monthly statistics released on Thursday – signalling investors’ gradual acceptance and understanding the benefits of ETFs.

“If you take three years ago, we may be trading S$2 million of ETFs a day but that has easily gone up by almost 20-fold to S$40 million to S$50 million a day,” said Chew Sutat, Head of Securities, SGX.

SGX said it will continue to focus on educating the market about ETFs and expanding its product offerings for passive investments.

To this end, two new ETFs on Asian fixed income were launched on the exchange.

BlackRock’s two new ETFs – iShares Barclays Capital Asia Local Currency Bond Index ETF and iShares J.P. Morgan USD Asia Credit Bond Index ETF – are said to be the first to provide multi-market Asian bonds coverage on the exchange.

“These products are particularly unique in the ETF space in that they offer exposure to the corporate debt issuer as well as the sovereign issuers, in comparison to the other products that are here in Singapore,” said Catherine Barker, Director and Head of iShares Southeast Asia, BlackRock.

The products will trade in US dollars, and are expected to provide up to 4 per cent yield per annum. The ETFs will also allow retail and institutional investors an entry into hard-to-access asset classes.

BlackRock said the Asian bond market has grown dramatically as more funds flow into emerging markets.

“There is a general belief in the ongoing growth of Asia and the strength of Asian markets, and the strength of Asian bond markets in particular. We see that demand and we are looking to provide options for investors to access that,” said Nick Good, MD and Head of iShares, Asia Pacific, BlackRock.

“We are looking international equity ETFs more deeply, particularly here in Asia, where there is tremendous demand for exposure to Asian countries. Equally, we see demand for more extensive fixed income, commodities and currencies right across the asset classes,” he added.

The addition of the two new ETFs brings the number of listed ETFs on the exchange to 84 in total, with more coming on stream.

Adapted from CNA (By: Millet Enriquez)

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APB acquires Solomon Breweries

APB acquires Solomon Breweries

SGX-listed Asia Pacific Breweries (APB) said it has completed the acquisition of a 97.69 per cent stake in Solomon Breweries for S$21.5 million.

The firm said the deal is a strategic fit to APB’s expansion in the South Pacific sector as it taps on Solomon Breweries’ good track record of market leadership and profitable growth.

“The robust distribution network, popular beer brands and goodwill of Solomon Breweries immediately make APB a leader in this new market and create a new source of earnings for the group,” APB chief executive officer Roland Pirmez said in a statement.

Apart from an enhanced earnings base, Mr Pirmez said there would also be regional synergies in cost management and commercial excellence in the firm’s operations in Papua New Guinea and New Caledonia.

The only brewer in the Solomon Islands, Solomon Breweries, enjoys good market share with its SB and Solbrew Lager brands.

Beer consumption in the island stood at about 67,000 hectolitres in 2010.

The per capita consumption stood at approximately 12 litres and is expected to increase further, driven by the country’s robust economy and growing population.

APB said the acquisition will be immediately accretive to the company’s earnings, but it will not have any material impact on net tangible assets and earnings per share of the company for the current financial year.

Adapted from CNA (By: Millet Enriquez)

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SGX Will Re-Tool Corporate Governance

SGX will re-tool corporate governance

Singapore Exchange (“SGX”) is consulting the public on amendments to the listing rules to enhance shareholder engagement, encourage participation at general meetings and increase disclosure of voting outcomes. SGX is of the view that communication and engagement of shareholders by listed companies are important components of good governance. The proposed rule revisions are as follows:-

(i) Hold General Meetings in Singapore

General meetings are important avenues for shareholders to interact with the board and management of listed companies. Shareholders have the right to ask questions and gain a better understanding of the developments and plans of the companies. For SGX primary-listed companies with a majority of their shareholder base in Singapore, holding general meetings locally is one of the best ways to facilitate engagement with shareholders.

The Exchange notes that some foreign-incorporated issuers may be legally restricted from holding general meetings outside those jurisdictions. In such cases, the company should hold a meeting (not a statutory meeting) in Singapore at an appropriate time for shareholders to meet and hear directly from the Board and management on company matters. These meetings also facilitate questions and comments from shareholders to their Boards.

The Exchange proposes for all primary-listed companies to hold their general meetings in Singapore unless prohibited by relevant laws and regulations in the jurisdiction of its incorporation. This proposal is meant to encourage shareholders’ participation and enhance their empowerment.

(ii) Vote by Poll at all General Meetings

Voting by poll is one of the ways for shareholders, who are owners of the company, to exercise their interests and rights. Shareholders can be empowered to protect their own interest through their right to vote at general meetings. Voting by show of hand may be simpler to administer and in most cases, may not make a difference to the outcome. However, voting by poll more precisely allocates the rights to each vote according to the size of shareholding.

The Exchange proposes for all listed companies to adopt voting by poll and will provide sufficient time for administrative and logistics preparation in anticipation of the proposed rule amendments. Already, several companies in Singapore have adopted voting by polls at their general meetings.

(iii) Disclose Details of the Outcome of General Meetings

Many major decisions are made during general meetings. Shareholders should be informed on decisions made and the outcomes of their voting. The Exchange proposes a new rule for issuers to make prompt disclosure of the results of the polls, including details such as the number of votes for and against each resolution, as well as the number of proxy votes cast.

The proposed rule changes serve to enhance accountability and transparency of our listed companies. These amendments will apply to both Mainboard and Catalist companies.

The current proposal is part of the ongoing initiatives by SGX to strengthen governance among listed companies. SGX launched a series of programmes and initiatives, such as the online investors’ guide to reading annual reports and preparing for AGMs to educate investors. There was also a popular series of webclips on reading IPO prospectus.

Adapted from Futures Magazine.

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Symbol Bid Ask Spread
EURUSD 1.17520 1.17540 2
GBPUSD 1.28740 1.28770 3
USDCAD 1.25700 1.25730 3
USDJPY 109.310 109.330 2
USDCHF 0.96510 0.96540 3
AUDUSD 0.79320 0.79350 3
NZDUSD 0.73160 0.73210 5
EURGBP 0.91270 0.91300 3
EURCHF 1.13440 1.13470 3
EURJPY 128.470 128.500 3
AUDJPY 86.700 86.750 5
GBPJPY 140.730 140.790 6
XAUUSD 1286.84 1287.24 40
XAGUSD 17.019 17.032 1.3