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Singapore stock market and companies daily report (The Dow Jones Industrial , PLife Reit ,Miyoshi Precision) (July 14, 2010)

Contributed by Shares Investment

By Shares Investment

US Stocks Climb On Strong Earnings Season Kickoff

The Dow Jones Industrial Average closed 1.4% higher as 2Q earnings season kickoff with a positive start and Greece’s sale of debt bolstered optimism in the economic outlook. The Nasdaq gained nearly 2%, while the S&P climbed 1.5%. It was the market’s first 6-day winning streak since late April. This was despite a downgrade on Portugal after Moody’s Investors Service cut the nation’s bond ratings to A1 from Aa2. Oil prices rose above US$76 a barrel as rising equities markets helped traders shrug off a report showing the pace of crude demand slowing next year. Gold prices jumped nearly 2% to above US$1,215 an ounce while the euro hit a 2-month high against the US dollar.

PLife Reit Boosts Japan Portfolio With Acquisition Of 5 Nursing Homes

Parkway Life Real Estate Investment Trust (PLife Reit) is expanding its presence in Japan with the $48.3m acquisition of 5 nursing home properties. The properties will be bought from Yugen Kaisha, which is a subsidiary of Kenedix, a real estate asset manager in Japan. As at 30 Jun-10, the 5 properties had an average occupancy rate of 94.9%, with a weighted average lease term to expiry of 17.45 years. Yugen Kaisha will also be providing a rental income guarantee for 7 years with a cap of 5% of the purchase price, offering certainty for the PLife Reit’s future distributions. The acquisition, which will be completed by 23 Jul-10 , will be funded through a 5-year revolving credit facility of up to 3.2b yen, which will increase PLife Reit’s gearing from 32.2% to 34.4%.

Significance: PLife Reit’s recent ramp-up in its acquisition of nursing homes in Japan will improve the returns to unitholders and give the Reit a boost in geographical diversity.

Miyoshi’s 3Q10 Profit Dives 64%

Miyoshi Precision (Miyoshi) registered a 64% fall in net profit to $946k for 3Q10 due to foreign exchange losses from a sharply weakened US dollar, the increase in employee benefit expenses, and reduced orders for consumer electronic products. This was despite a 69.3% rise in revenue to $35.22m, buoyed by contribution from Giken Sakata. Miyoshi raised its stake in Giken to 53.16% in 1Q10, after having acquired 27.64% in FY09. Data storage revenue for 9M10 grew in line with industry trends but the growth in other segments were predominantly the result of Giken’s revenue consolidation. Meanwhile, revenue for 9M10 rose 54% to $110.77m and net profit grew 34.4% to $7.49m subsequently.

Significance: Despite its setback in 3Q10, Miyoshi may be able to maintain its FY09 performance, with its 9M10 revenue already exceeding that of FY08.

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