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Singapore stock market and companies daily report (Wall Street, Private Equity Industry, HG Metal) (March 08, 2010)

Contributed by Shares Investment

By Shares Investment

Wall St Back In Bulls Territory
The stronger-than-expected jobs report on Friday has fuelled a spurt on Wall Street, capping a 2-week rally that has brought US stocks into positive territory for the year, and within striking distance of the S&P 500’s recent January high. Indeed, the US nonfarm payroll employment in February declined 36,000, against an earlier market forecast for a 50,000 fall in employment and the unemployment rate held steady at 9.7%.
The blue-chips Dow surged 1.17% to close Friday at 10,566. The broader S&P 500 logged a healthy 1.4% gain, to end the day at 1,138.69. The Nasdaq Composite added 1.48% to close at 2,326.35. The Dow and S&P 500 both moved into positive territory for the year this past week, and are now about 1% away from their mid-January highs. The Nasdaq is now at an 18-month peak. Market watchers are expecting the coming week to be another good one potentially for the stock market, if the few retail reports scheduled for release over the next few days show good numbers.

Private Equity Investment Poised For recovery
The private equity industry in South-East Asia is expected to recover substantially from the lows of 2009, according to a report by The Business Times (BT) based on a new Deloitte survey report conducted. The report was based on interviews with some 25 senior executives in the private equity industry in the region and it said that “private equity players see a multitude of mid-sized deals in the energy, mining and consumer-related sectors.”
‘Since the region was never over-leveraged, the long-lasting structural changes in the banking industry being seen in the west are less likely to effect private equity here,’ Heath Snyder, who heads private equity for Deloitte in Singapore and South-east Asia told BT in an interview. While funds have traditionally flowed in from the West, a lot more institutions in Asia are looking to allocate funds to private equity in the region, he said. The valuation gap between buyers and sellers – which has put off dealmaking in the past year – is nevertheless closing. ‘It is probably more the buyers that have become more confident. Sellers haven’t really adjusted their expectations,’ a respondent of the report noted.

HG Metal Reduces Further Stake In BRC Asia To Pay Short Term Debts
HG Metal Manufacturing has said it will sell 28m shares in steel company BRC Asia (BRCA) to help meet its short-term debt. The company has inked a deal with 12 separate buyers to sell BRCA shares at $0.135 per share in cash for $3.78m. The company added it will realise an estimated net loss of approximately $700k from the proposed disposal.
HG was last month hit by a $3.27m claim from LPM Projects, after recording 5 straight quarters of losses ending with 4Q09. It has since swung back into the black with a 1Q10 net profit of $8.7m, helped along by gains from an earlier disposal of BRCA shares.
HG had earlier sold 80.6m BRCA shares at $0.145 in January, through a private placement exercise. This had netted it about $11.7m. The sale had pared its stake in BRCA down from 43.67% to 31.67%. This latest proposed sale will bring its stake down to about 27.50%.

This article is contributed by Shares Investment. Visit Sharesinv.com for the latest Singapore, Malaysia and China stock market news and reports.