MICA (P) 081/12/2011 Ref No: RM2012_0168 1 of 17

Regional Market Focus

Phillip Securities Research Pte Ltd

30 August 2012

Morning Market Commentary

- STI: +0.05% to 3041.6 - MSCI SE Asia: -0.60% to 812.8 - Hang Seng: -0.12% to 19788.5 - MSCI APxJ: -0.02% to 421.6 - Euro Stoxx 50: -0.32% to 2434.2 - S&P500: +0.08% to 1410.5 MARKET OUTLOOK: The S&P500 ended just a tad higher on Wednesday on the back of (i) an upward revision in US 2Q12 GDP (in line with expectations) and (ii) slightly better-than-expected increase in pending home sales (See Macro Data below). The Fed Beige book also painted a mixed picture of the US economy. Specifically, while growth was modest and employment improved slightly, manufacturing activity was softening. Volumes remained thin as investors likely stay on the sidelines, awaiting Bernanke’s speech at the Fed Jackson Hole symposium this Friday. We have some insights on what ECB president Mario Draghi might have said at the Jackson Hole. Parsing through his op-ed piece in German paper Die Zelt, Draghi did not rule out the possibility of “exceptional measures” to “ensure a a single monetary policy”. This is in line with our expectations of a major policy announcement from the ECB next Thursday. Draghi also proposed a new architecture for the euro area where political union need not be a pre-requisite. Instead, economic and political integration can develop concurrently. We –along with the markets- suspect that ECB is considering informal yield band targets for short-term bonds of peripheral EZ economies (such as Spain) to alleviate the elevated borrowing costs as well as risk premia of these economies. However, we opine that such a plan that would pose a moral hazard (i.e. weaken the resolve of EZ govt to restructure their troubled economies) and effectively make the ECB a lender of last resort. Nonetheless, as we have reminded our readers, any form of ECB intervention will come with strings attached (i.e. conditionality) -a key ECB/German requirement. We look to the ECB’s Sept 6 policy meeting for details of ECB’s new bond-buying program if it is finalised by then. Tomorrow, Bernanke’s speech at the Fed Jackson Hole symposium poses a critical event risk. The recent summer rally was largely buoyed by hopes for synchronised policy stimulus from major central banks. However, we caution that market might not be able to sustain its momentum against a still fragile macroeconomic backdrop. In fact, markets should be positioning for some disappointments and could sell off over the next few weeks, pending (i) Bernanke’s clarification on the Fed’s stance at the Jackson Hole symposium this Friday and (ii) ECB’s ability to deliver. As to whether there will be QE3 in Sept, it is going to be a close call. We are of the view that while the US economy is still sluggish (no strong economic rebound), it is not sufficiently weak enough to warrant further QE in September (but inevitably by the end of this year). We opine that this “additional monetary accommodation” (alluded in the Aug FOMC minutes) might also that the form of an extension of the current late-2014 rate guidance. The global economic trajectory is in a broad slowdown with August PMI portending lacklustre manufacturing performance in the months ahead. Asia's export data has been abysmal with a big disappointment from China - NE Asia economies are suffering due to China's slowdown. EZ is for all intents and purposes in recession and a program of austerity is going to hold it back this year and next. As for the US, core capex new orders are falling, below average employment and incomes and an impending fiscal cliff make us believe in a below consensus recovery. Notwithstanding some stabilisation in the housing prices, US consumers are also increasingly more pessimistic about the short-term outlook. Positive stimulus –if any- from central banks are likely to only result in tactical rallies for equities that cannot be sustained against this subdued macro backdrop. Our SG Sector Strategist likes defensives (SCI, Comfort, Singtel), and is sector overweight Aviation Services (SIAEC, STE, SATS), and the REITS. PORTFOLIO OUTLOOK: From a medium-longer term portfolio stance we are neutral at best for stocks till 1q13 as we think absolute returns could prove fleeting due to a global slowdown and fiscal uncertainty in the US. But within the stock space we prefer & Overweight ASEAN markets - the KLCI, JCI, SETI, PSEI, STI - to be relatively more resilient. For the first 4, domestic demand and pro-growth govt policy counteracts a weak external environment. As for the STI: +60% earnings exposure to ASEAN & Emerging Markets, high dividend yields in strong business moats, and the SGD's relative safe haven status, makes the STI an attractive buy in these yield starved times. For broad asset classes, we are still overweight Fixed Income (ETF tickers in brackets) over Stocks, Commodities, as we think macro headwinds remain considerable. In any case, as rates are repressed in the traditional safe havens of Treasuries (TLT: NYSE), Bunds, Gilts, SGS (A35:SGX), portfolios hard pressed for yield will likely have to explore beyond the traditional safe havens, thus within the bond space we're overweight dollar denominated EM sovereigns (EMB:NYSE), dollar denominated Asian Sovereigns & Corporates (N6M:SGX and O9P:SGX), and US Corporate Debt (VCLT:NYSE).

Regional Market Focus

30 August 2012

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Reports & Macro Data

REPORTS: Global Macro, Asset Strategy: 26 July Singapore Sector Strategy: 1 Aug Singapore Sector Reports: Banks / Transport / Telcos / Property / REITS / Thematic Regional Strategy: China, 23Aug/ Indon, 17 July / HK, 22 June / Thai, 18 June / S'pore, 8 June / M'sia, 30 May

MACRO DATA: In US, 2Q12 GDP was revised upwards to 1.7% q-q saar (from first reading of 1.5%) on the back of the upward revisions in net exports as well as consumption growth. Pending home sales also increased 2.4% m-m sa, reversing from a decline of 1.4% in the preceding month in July. In Euro zone, France’s industrial confidence remained close to its two year low in August, at 90, after a revised 89 in July. Germany’s inflation slowed down to 1.9% in July, lower than ECB’s target of 2.0%, which may prompt easing by ECB during a meeting next week. In South Korea, current account surplus widened to 6.1 bn USD, compared to a revised 5.9 bn in June, as import for raw material declines and domestic demand eases. The government is currently holding an interest rate at 3.0% and still has scope for further cut as inflation has slowed down to a relatively low level of 1.5% in July. In Thailand, exports continued to contract 4.5% y-y in July, following a decline of 2.3% in the preceding month. Recall manufacturing output also registered a larger-than-expected decline of 5.8% y-y in July. As we have repeatedly cautioned, sluggish external demand (particularly on the EU front) as well as global macro uncertainties are likely to weigh on factory output and exports despite the easing of supply chain disruptions. We opine that the central bank is likely to continue to stand pat on account of inflationary pressures (from lagged effect of April minimum wage hike as well as increases in energy levies) despite downside risks to growth (arising from macro uncertainties on the EU front). Nonetheless, should growth falter, markets can take comfort that there is still room for BoT to cut rates (likely a 25bps rate cut) to stimulate the economy if necessary as core inflation (which excludes energy and fresh food) continued to ease to 1.87% in July -well within the target range of 0.5-3.0%.

Source: Phillip Securities Research Pte Ltd

Regional Market Focus

30 August 2012

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Singapore The FTSE Straits Times Index (STI) rose 0.05% to close at 3,041. Market volume

was 1.3 billion shares with value of $1.1 billion. There were 222 gainers vs 195 decliners.

Olam Ltd fell 2.0% after announcing FY2012 results that came in below expectations. Sembcorp Ind rose 1.6% to lead gains among the index component stocks.

Although market volume pick up slightly, we are still of the view that trading will stay muted this week and the index will remain flat, as investors hold out for Friday’s US Fed meeting.

Close +/- % +/-FSSTI 3041.57 1.50 0.05P/E (x) 12.31P/Bv (x) 1.38

3.07Dividend Yield

STRAITS TIMES INDEX

2500

2700

2900

3100

3300

8/29 11/29 2/29 5/31

Source: Bloomberg

Thailand Thai stocks seesawed in a tight range throughout the session on Wed but blue

chips, especially banking stocks succumbed to profit-taking in late trading, dragging the SET index lower to end at the day’s low of 1220.16 points.

The Thai stock market seems to be awaiting new clues from overseas markets while internal factors are still unchanged. The market’s attention remains fixed on a speech by US Federal Reserve Chairman Ben Bernanke in Jackson Hole, Wyoming on Fri to look for signs of possible stimulus action. Data also showed US gross domestic product grew a revised 1.7% in the second quarter in line with economists’ expectations, making investors hesitant to increase bets on risky assets.

Yesterday’s sell-offs in big-caps especially in the banking sector would continue to weigh on the SET index today. We believe any gains are expected to be reined in today. For short-term strategy, we continue to advise investors to cut exposure to risky assets by booking profits at resistance levels.

Resistance on the main index is pegged at 1228, 1235 and support at 1218, 1210 today.

Close +/- % +/-SET INDEX 1220.16 -13.00 -1.05P/E (x) 17.24P/Bv (x) 2.13

3.77Dividend Yield

STOCK EXCH OF THAI INDEX

800

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1000

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1200

1300

1400

8/29 11/29 2/29 5/31

Source: Bloomberg

Indonesia

Indonesian stocks finished mostly lower Wednesday (29/08), amidst mixed closes on Asian markets, as investors turned cautious ahead of the economic symposium at Jackson Hole, US, this weekend. The Jakarta composite index lost 49.678 points, or 1.20% to close at 4,093.170. The decline included seven of the 9 major industry groups, led by basic industry which plummeted 2.51%, followed by financial dropped 2.18%, and mining lost 2.03%. The LQ 45 index - which tracks Indonesia’s blue-chip shares – shed 9.718 points, or 1.36% to close at 702.224, with shares of tobacco manufacturer Gudang Garam (GGRM) declined 1.46%, or 750 points, to IDR 50,500. Blue-chip top performers were led by shares of Unilever Indonesia (UNVR) which added 4.46%, or 1,150 points, to IDR 26,950. More than 50 shares advanced, 200 shares fell, and the remaining 206 shares remained unchanged Wednesday on the Indonesia stock exchange, where 3.077 billion shares worth IDR 3.676 trillion changed hands on the regular board. Foreign market participants posted net sales worth IDR 280.499 billion in total.

The JCI will likely continue to decline today, as Asian markets started lower today after flat finish on US markets. We expect the composite index to trade with support at 4,036 and resistance at 4,167.

Close +/- % +/-JCI Index 4093.17 -49.68 -1.20P/E (x) 18.32P/Bv (x) 2.74

2.19Dividend Yield

JAKARTA COMPOSITE INDEX

3000

3200

3400

3600

3800

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4200

4400

8/29 11/29 2/29 5/31

Source: Bloomberg

Regional Market Focus

30 August 2012

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Sri Lanka The market successfully maintained its positive momentum for the 3rd

consecutive day and was very much a retailer driven. The Colombo Bourse closed the trading day recording positive closures on all indices. 247 counters engaged in trading today, further the market recorded 110 positive price contributors against the 93 negative subscribers. The ASI closed the day recording 5,114.15, gaining 11.50 points. The liquid MPI closed for the day gaining 2.51 points to end the day at 4,756.05. The S&P SL20 Price Index gained 09.38 points and closed at 2,866.13. The market capitalization was LKR 1.95Tn.

The market turnover for the day was Rs.444Mn. which is an 85% reduction

compared to the previous day. The best performing sectors for the day in terms of turnover were and Bank Finance and Insurance (Rs.68.7Mn) and Hotels And Travels (Rs.64.3Mn) sectors correspondingly. The total traded volume for the day ware 44.2Mn. This is a 26.8% reduction against the previous day. The market recorded a net foreign inflow of LKR 7.7MN.

Close +/- % +/-CSEALL Index 5114.15 11.50 0.23P/E (x) 10.48P/Bv (x) 1.63

2.68

Dividend Yield

SRI LANKA COLOMBO ALL SH

4500

5000

5500

6000

6500

7000

7500

8/29 11/29 2/29 5/31

Source: Bloomberg

Australia

The Australian share market finished the day flat after falls by heavyweight miners Rio Tinto and BHP Billiton. The local market on Wednesday closed lower, with the benchmark S&P/ASX200 index down 3 points or 0.07 per cent to 4,356.4.

The Australian market is set to open slightly lower today as investors remain timid ahead of a highly anticipated speech from US Federal Reserve chief Ben Bernanke at the end of the week. The SFE Futures 200 is indicating down 10 points or 0.22 per cent to 4,342. As we get half way through the reporting season, Lend Lease, Perpetual, Prime Media Group and Boart Longyear release their full year financial results today.

On the economic news front for Thursday, the Australian Bureau of Statistics (ABS) releases building approvals data for July, and private new capital expenditure and expected expenditure data for the June quarter.

Close +/- % +/-S&P/ASX 200 INDEX 4356.45 -2.93 -0.07P/E (x) 16.51P/Bv (x) 1.73

6.52Dividend Yield

STANDARD & POORS/ ASX 200 INDEX

3800

4000

4200

4400

4600

8/29 11/29 2/29 5/31

Source: Bloomberg

Hong Kong

The HSI dropped 23 points to 19,789 but the HSCEI dropped 51 points to 9,470. The full-day volatility shrank to 93 points only and the volume was 43.7 billion.

AGRICULTURAL BANK OF CHINA LIMITED(1288) reported interim results. Net

profit increased by 20.8% to $80.522 billion (RMB) yoy and the core capital adequacy ratio was 12.02%.

Another Chinese bank, CITIC BANK(998) also reported interim results. Net profit

rose by 29% to $19.4 billion (RMB) yoy. Both Chinese bank got earnings growth mainly from the high net interest income growth

Technically, the HSI closed at 19,789. The trading volume shrank this week and

no obvious signal was shown. We remain our short term bearish view, investors are suggested to stand on sideline and wait for a clear trading signal.

We peg resistance for the HSI at 20,000 and support at 19,600.

Close +/- % +/-HSI INDEX 19788.51 -23.29 -0.12P/E (x) 10.10P/Bv (x) 1.35

3.64Dividend Yield

HANG SENG INDEX

16000

17000

18000

19000

20000

21000

22000

23000

24000

8/29 11/29 2/29 5/31

Source: Bloomberg

Regional Market Focus

30 August 2012

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Thailand

Somboon Advance Technology – Trade Flash Recommendation: ACCUMULATE Previous close: Bt29.25 Fair value: Bt31 SAT’s management adjusted its 2012 sales target up to Bt9,500mn, representing growth of 48% y-y versus earlier 35% y-y.

We cut our CY12 net profit forecast down by 4% to Bt880.34mn as gross margin is expected to lower than estimate.

We recommend an ‘ACCUMULATE’ rating on SAT shares with a CY12 target price of Bt31/share, based on P/E of 12x.

Hemaraj Land and Development – Company Update Recommendation: NEUTRAL Previous close: Bt2.94 Fair value: Bt3 HEMRAJ’s affiliate Gheco One became a damp on HEMRAJ’s earnings performance in 1HCY12.

Land sales in industrial estate continued to grow nicely; management raises CY12 sales target by 15%. Gheco One has commenced commercial operation in 2HCY12, which will help support considerable growth.

For CY13, net profit is projected to continue to grow as power business is expected to be a key driver, though land sales would be lower y-y.

We reiterate a ‘NEUTRAL’ rating on HEMARAJ shares with a target price of Bt3/share, as share prices already reflected in earnings growth outlook.

Hong Kong Tianneng Power International Limited - Uncertainty ahead Rating: Neutral Close Price: HKD $5.01 Target Price: HKD $5.11

Revenue soared 56.9% y/y to CNY 3,824.5 million.

Gross profit margin stretched by 3.3% y/y from 22.5% to 25.8%.

Net income surged 87.2% y/y to CNY 376.3 million.

Basic EPS surged 85.95% y/y to CNY 34.4 cents.

The lead recycling Zhejiang Wushan production base has started the trial production in 2Q2012. It has the annual capacities of 150,000 ton used battery collection and 100,000 ton recycled lead production respectively.

Regional Market Focus

30 August 2012

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Market News

US Pacific Investment Management Co.’s Bill Gross said the Federal Reserve will add to monetary stimulus even if Chairman Ben S.

Bernanke fails to indicate additional measures during a speech in two days. Policy makers will announce more so-called quantitative easing “relatively soon,” Gross, who runs the world’s biggest bond fund, said in an interview on Bloomberg Television’s “Street Smart” with Trish Regan. The Fed signaled last week it’s ready to take further steps to spur the economic recovery. Many policy makers said additional stimulus probably will be needed soon unless the economy shows signs of a durable pickup, according to minutes released Aug. 22 of the central bank’s most recent meeting, on July 31-Aug. 1. Bernanke is scheduled to speak on Aug. 31 at the Kansas City Fed’s economic-policy conference in Jackson Hole, Wyoming. (Source: Bloomberg)

Samsung Electronics Co. (005930) unveiled a new version of the pen-equipped Galaxy Note smartphone as it seeks to defend its lead

over Apple Inc. (AAPL) amid global patent disputes with the iPhone maker. The model has a 5.5-inch screen, larger than its predecessor, and runs the latest version of Google Inc. (GOOG)’s Android operating system. The device is loaded with software that recognizes handwriting from a digital pen. (Source: Bloomberg)

Singapore Singapore share prices opened lower on Thursday with the Straits Times Index down 8.21 points to 3,033.36. Volume was 85.4 million

shares worth S$50.2 million. Losers outnumbered gainers 71 to 51. (Source: BT online) INTERNATIONAL Enterprise (IE) Singapore is signing a new agreement with the International Finance Corporation (IFC) to facilitate

closer business tie-ups between Singapore and Africa. The memorandum of understanding (MOU) with the IFC, a member of the World Bank Group, will be inked later today at the second Africa-Singapore Business Forum. The MOU will promote collaborations between firms from Singapore and Africa through the sharing of business leads and potential opportunities. Some of the sectors include agri-business, transport and logistics, and urban and industrial planning. (Source: BT online)

Hong Kong China’s stocks fell, dragging the benchmark index to its lowest level in more than three years, after companies from Air China Ltd.

(601111) to Zhongjin Gold Co. reported a decline in first-half profits. Air China, the nation’s largest international carrier, sank to its lowest level since March 2009, while Zhongjin Gold, the third-largest

bullion producer by market value, retreated 2.3 percent. FAW Car Co. (000800), which makes passenger cars with Volkswagen AG, declined for a seventh day as the company reported a six- month loss. Shanghai Chaori Solar Energy Science & Technology Co. rose 6.4 percent after Japan imported more solar products.

Thailand Thailand’s exports in Jul 2012 dropped 4.46% y-y to US$19bn, leaving Thailand with a trade deficit of US$1.7bn, according to the

Ministry of Commerce. In the first seven months of 2012, exports contracted 0.4% y-y. The Bank of Thailand warned that export growth may be lower than 7% this year. To achieve the target, the central bank said exports during the latter half of the year must be at least US$22bn/month. (Source: Krungthep Turakij)

Foreign investors remained net sellers of Thai equities worth Bt1,173.09mn on Wed. (Source: Bisnews)

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Indonesia The government targets foreign direct investment (FDI) in 2013 to reach USD 30 billion. Coordinating Minister of Economy, said the

target is realistic because the first semester of this year’s Gross Fixed Capital Formation (Pembentukan Modal Tetap Bruto/PMTB) grew by 12.31 percent. According to him, there are three requirements in order for investment to enter Indonesia; to maintain investment climate, legal certainty, and no corruption. Improvement in Indonesia and global economic fundamentals is expected to encourage increased capital inflows into the country, especially FDI. The increase in capital flows is expected to boost Indonesia's balance of payments surplus, and thereby strengthening Indonesia's foreign reserves. The Investment Coordinating Board (BKPM) said next year's total investment target amounts to IDR 390 trillion. The target is based on the assumption that economic growth reaches 6.8 percent, so PMTB can grow 11.9 percent, foreign investment can grow 25 percent, and domestic investment increases 30 percent. The investment realization during the first half of 2012 reached IDR 148.1 trillion or 52.2 percent of the 2012’s investment target of IDR 283.5 trillion. Realization increased 28.1 percent over the same period in 2011 with IDR 115.6 trillion. Domestic investment reached IDR 40.5 trillion or 52.8 percent of the 2012’s target of IDR 76.7 trillion and foreign investment reached IDR 107.6 trillion or 52 percent of the 2012’s target of IDR 206.8 trillion. (Source: Indonesia Finance Today)

Approximately 40 percent of the Master Plan for the Acceleration and Expansion of Indonesian Economic Development (MP3EI) projects

are less viable and requires incentives from the central government. The projects are averagely located in Eastern Indonesia, especially in the Bali -East Nusa Tenggara Corridor and Papua-Maluku Corridor. Director of Development for Public-Private Cooperation, Ministry of National Development Planning, said efforts that need to be taken into consideration in the 2012 Indonesia International Infrastructure Conference and Exhibition (IIICE) is how the projects that have been offered can be granted a variety of incentives, especially for less feasible projects – both from the benefit (return) and licensing aspects. The infrastructure projects are divided into three categories, namely the government, the state-owned enterprises, and the mixture, which were offered during the period of 2011-2025. Based on IFT calculation, the number of projects identified in the six corridors reaches 396 projects – meaning that 40 percent of those projects are less feasible, or equivalent to 159 projects. (Source: Indonesia Finance Today)

Sri Lanka Sri Lanka's Treasuries yields edged up across maturities at Wednesday's auction with the three months yields gaining 05 basis points to

11.41 per cent. The 6-month yield rose 05 basis points to 13.07 per cent and the 12-month yield rose 04 basis points to 13.31 per cent points. The debt office sold 6.4 billion rupees of 3-month bills, 7.8 billion rupees of 6-month bills and 4.3 billion rupees of 12-month bills totaling 18.5 billion rupees. The office offered 17,000 billion rupees of maturing bills. (Source: lbo.lk)

Sri Lanka’s total outstanding government debt stood at Rs.5902.2 billion as at end of May 2012, against Rs.4800.9 billion reported during

the same period of 2011, Out of the total debt, Rs.3142.5 billion was domestic debt, while foreign debt component stood at Rs.2759.7, up from Rs.2733.2 billion reported in the corresponding period of the previous year. The government has borrowed Rs.694 billion and Rs.1985.5 billion by selling Treasury bills and Treasury bonds, respectively. The loan instalment by the end of May 2012 stood at Rs.189.6 billion, up from Rs.130.5 billion in 2011, while the government’s current expenditure rose to Rs.506.4 billion from Rs.413.1 billion. (Source: dailymirror.lk)

Australia An expected iron ore price floor that miners have long been flagging could be a long way off, with prices of the steelmaking ingredient

continuing to slump amid talk that China is subsidising high-cost iron ore production. Prices of iron ore, Australia's biggest export, have fallen 30 per cent in the past two months and are down the same amount from the price on which the government's commodity forecaster bases its most recent forecast of $66.9 billion of 2012-13 iron ore revenue. The price collapse threatens to put a huge hole in federal government company and mining tax incomes and West Australian royalty earnings. (Source: The Australian)

Foreign Minister Bob Carr is backing the theory that the boom is far from over, saying prices and demand should recover by the time

Australia's committed investment pipeline plays out. The Gillard government's front bench has been on message about the continuation of the boom after Resources Minister Martin Ferguson embarrassed the government by saying the boom was over following BHP Billiton's decision to shelve more than $50 billion of growth projects. (Source: The Australian)

The holiday industry is back, due most obviously to the Chinese. Tourism in Australia from all sources is edging up, and hotel room

occupancy rates have beaten their pre-global financial crisis record, a new report on the sector by Deloitte shows. International visitor numbers were growing, fuelled by other Asian nations, Deloitte Access Economics Lachlan Smirl said. “The Asian boom has seen the emergence and growth of a travel, or will visit, Australia.” Chinese visitor numbers have increased 350 per cent since 2002. They totalled 53,000 last June and 594,000 for 2011-12, on Australian Bureau of Statistics trend figures, up 18 per cent on the previous financial year, out of 6 million foreign arrivals, up 2 per cent. (Source: The Financial review)

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Dollar Index +0.22% Gold 1,656.50 -0.02%

Crude oil -0.87% US Treasury 10yr Yield 1.654 +0.00%

DJI +0.03% S&P 500 INDEX 1,410.49 +0.08%

SHCOMP -0.96%

Source: Bloomberg

10000

11000

12000

13000

14000

Aug-11

Oct-1

1

Dec-11

Feb

-12

Apr-1

2

Jun-1

2

70

75

80

85

Aug

-11

Oct-1

1

Dec-1

1

Feb-1

2

Apr-1

2

Jun-1

2

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2000

Aug-11

Oct-1

1

Dec-11

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-12

Apr-1

2

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2

70

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90

100

110

120

Aug-11

Oct-1

1

Dec-11

Feb

-12

Apr-1

2

Jun-1

2

1.51.61.71.81.9

22.12.22.32.42.5

Aug-11

Oct-1

1

Dec-11

Feb

-12

Apr-1

2

Jun-1

2

2000

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2600

Aug-11

Oct-1

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-12

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1

Dec-11

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2

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Source: Bloomberg

Major World Indices

JCI -1.20% 4,093.17

HSI -0.12% 19,788.51

KLCI -0.09% 1,645.58

NIKKEI 0.40% 9,069.81

KOSPI 0.64% 1,928.54

SET -1.05% 1,220.16

SHCOMP -0.96% 2,053.24

SENSEX -0.80% 17,490.81

ASX -0.07% 4,356.44

FTSE 100 -0.56% 5,743.53

DOW 0.03% 13,107.48

S&P 500 0.08% 1,410.49

NASDAQ 0.13% 3,081.19

COLOMBO 0.23% 5,114.15

STI 0.05% 3,041.57

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Singapore

Top 10 Value Last % Chg Chg Value ('k) Top 10 Volume Last % Chg Chg Volume ('k)

OLAM INTERNATION 1.95 -2.01 -0.040 66,726 GOLDTRON LTD 0.00 +0.00 +0.000 66,504

SAKARI RES LTD 1.90 +0.00 +0.000 63,034 GSH CORP LTD 0.09 +2.17 +0.002 56,116

UNITED OVERSEAS 19.78 +0.15 +0.030 47,893 DYNA-MAC HOLDINGS LTD 0.53 +5.00 +0.025 49,456

DBS GROUP HLDGS 14.62 +0.83 +0.120 46,641 EMS ENERGY LTD 0.04 -10.00 -0.004 49,417

NOBLE GROUP LTD 1.23 -0.81 -0.010 42,348 NOBLE GROUP LTD 1.23 -0.81 -0.010 34,390

GENTING SINGAPOR 1.36 +0.00 +0.000 36,074 OLAM INTERNATIONAL LTD 1.95 -2.01 -0.040 34,259

KEPPEL CORP LTD 11.26 +0.27 +0.030 34,233 GOLDEN AGRI-RESOURCES LTD 0.72 +0.70 +0.005 33,964

FRASER AND NEAVE 8.32 +0.24 +0.020 30,305 SAKARI RESOURCES LTD 1.90 +0.00 +0.000 33,170

SINGAP TELECOMM 3.34 -0.60 -0.020 26,185 BLUMONT GROUP LTD 0.08 +3.85 +0.003 28,891

DYNA-MAC HOL LTD 0.53 +5.00 +0.025 25,909 GENTING SINGAPORE PLC 1.36 +0.00 +0.000 26,501

Hong Kong

Top 10 Value Last % Chg Chg Value ('k) Top 10 Volume Last % Chg Chg Volume ('k)

GALAXY ENTERTAIN 22.65 +3.42 +0.75 6,458,809 CHINA EVERBR INT 3.76 -3.34 -0.13 412,358

CHINA EVERBR INT 3.76 -3.34 -0.13 1,485,096 GALAXY ENTERTAIN 22.65 +3.42 +0.75 305,403

IND & COMM BK-H 4.27 -1.39 -0.06 1,013,288 IND & COMM BK-H 4.27 -1.39 -0.06 236,207

CHINA LIFE INS-H 20.70 +1.97 +0.40 984,056 APOLLO SOLAR ENE 0.23 +1.33 +0.00 177,906

CHINA MOBILE 83.85 -0.24 -0.20 951,742 CHINA CONST BA-H 5.26 +0.38 +0.02 169,491

CHINA CONST BA-H 5.26 +0.38 +0.02 889,883 BANK OF CHINA-H 2.89 -0.69 -0.02 146,158

PING AN INSURA-H 56.70 -0.87 -0.50 825,603 EVERGRANDE REAL 3.09 -3.13 -0.10 129,770

CNOOC LTD 14.80 -0.27 -0.04 561,950 CHINA ENVIRONMEN 0.03 -13.79 -0.00 119,414

TENCENT HOLDINGS 242.60 +0.00 +0.00 493,704 UNITED GENE HIGH 0.04 +18.92 +0.01 113,380

JIANGXI COPPER-H 17.10 -5.11 -0.92 487,820 KARL THOMSON HLD 1.41 +18.49 +0.22 110,438

Thailand

Top 10 Value Last % Chg Chg Value ('k) Top 10 Volume Last % Chg Chg Volume ('k)

SHIN CORP PCL 65.00 -1.52 -1.00 1,500,020 TMB BANK PCL 1.67 -1.18 -0.02 171,648

ADVANCED INFO 208.00 -2.35 -5.00 1,209,610 BANGKOK LAND PCL 0.93 -3.13 -0.03 163,108

SAHA-UNION CORP 43.00 +28.36 +9.50 908,748 NATURAL PARK PCL 0.02 -33.33 -0.01 149,691

BANGKOK BANK PUB 190.50 -2.06 -4.00 899,937 BTS GROUP HOLDIN 5.55 -2.63 -0.15 116,226

CHAROEN POK FOOD 31.75 -0.78 -0.25 818,076 JASMINE INTL PCL 3.58 +0.00 +0.00 96,441

CP ALL PCL 33.75 -0.74 -0.25 809,747 ANGPAO ASSETS PC 0.98 +0.00 +0.00 93,307

KASIKORNBANK PCL 167.50 -3.18 -5.50 785,327 RAIMON LAND PCL 1.61 -1.83 -0.03 74,458

INDORAMA VENTURE 28.25 -4.24 -1.25 717,371 THAI-GERMAN PRO 0.42 +0.00 +0.00 63,385

BTS GROUP HOLDIN 5.55 -2.63 -0.15 652,816 GEN ENGINEERING 0.24 +0.00 +0.00 46,107

PTT PCL 333.00 -0.30 -1.00 613,032 IRPC PCL 3.78 -2.07 -0.08 44,921

Indonesia

Top 10 Value Last % Chg Chg Value ('mn) Top 10 Volume Last % Chg Chg Volume ('k)

BANK MANDIRI 7,800 -4.29 -350.00 262,650 ENERGI MEGA PERS 92 -8.91 -9.00 593,363

BUMI RESOURCES 670 -11.84 -90.00 229,001 BUMI RESOURCES 670 -11.84 -90.00 322,158

ASTRA INTERNATIO 7,000 -2.10 -150.00 216,786 TRADA MARITIME 830 0.00 0.00 169,128

TELEKOMUNIKASI 9,300 0.00 0.00 192,897 ALAM SUTERA REAL 455 -2.15 -10.00 146,181

BANK RAKYAT INDO 7,100 -2.74 -200.00 166,620 SENTUL CITY TBK 200 -2.44 -5.00 111,239

PERUSAHAAN GAS N 3,725 1.36 50.00 166,178 BAKRIE SUMATERA 131 -3.68 -5.00 102,062

INDOFOOD SUKSES 5,450 0.93 50.00 157,195 MITRA INVESTINDO 84 3.70 3.00 51,154

TRADA MARITIME 830 0.00 0.00 141,228 SUGIH ENERGY 103 -0.96 -1.00 49,359

SEMEN GRESIK TBK 12,400 -3.88 -500.00 135,713 BUMI SERPONG 1,030 -2.83 -30.00 45,474

UNITED TRACTORS 21,500 -1.38 -300.00 135,507 PERUSAHAAN GAS N 3,725 1.36 50.00 44,959

Sri Lanka

Top 10 Value Last % Chg Chg Value ('k) Top 10 Volume Last % Chg Chg Volume ('k)

AITKEN SPENCE PL 112.90 1.26 1.40 5,872 AITKEN SPENCE PL 112.90 1.26 1.40 52

COLOMBO LAND & D 37.90 1.34 0.50 32,329 BERUWALA RESORTS 3.10 6.90 0.20 538

DFCC BANK 118.90 1.54 1.80 2,557 EXPOLANKA HOLDIN 6.50 -1.52 -0.10 1,351

CITRUS LEISURE P 30.60 -0.65 -0.20 16,562 PANASIAN POWER L 2.70 0.00 0.00 5,414

DISTILLERIES CO 123.10 0.65 0.80 391 FREE LANKA CAPIT 2.30 0.00 0.00 5,448

COMMERCIAL BK 104.00 0.78 0.80 3,231 BROWNS INVESTMEN 3.40 0.00 0.00 910

ACL CABLES PLC 60.70 -0.49 -0.30 4,322 HYDRO POWER FREE 7.50 -3.85 -0.30 166

LANKA HOSPITAL 37.90 -0.26 -0.10 14,870 NATION LANKA FIN 9.50 3.26 0.30 749

EXPOLANKA HOLDIN 6.50 -1.52 -0.10 8,866 CITRUS LEISURE P 30.60 -0.65 -0.20 532

CEYLON GRAIN ELE 56.60 0.35 0.20 8,979 COLOMBO LAND & D 37.90 1.34 0.50 844

Source: Bloomberg

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Australia

Top 10 Value Last % Chg Chg Value ('k) Top 10 Volume Last % Chg Chg Volume ('k)

BHP BILLITON LTD 32.760 -1.03 -0.34 357,382 AUSTIN EXPLORATION LTD 0.024 14.29 0.00 129,592

RIO TINTO LTD 50.540 -2.34 -1.21 293,473 LONRHO MINING LTD 0.015 7.14 0.00 73,788

TELSTRA CORP 3.820 1.60 0.06 199,287 TELSTRA CORP LTD 3.820 1.60 0.06 52,463

NATL AUST BANK 25.090 -0.63 -0.16 168,526 LYNAS CORP LTD 0.710 7.58 0.05 44,324

COMMONW BK AUSTR 54.310 -0.18 -0.10 180,368 FORTESCUE METALS GROUP 3.650 -6.41 -0.25 44,102

FORTESCUE METALS 3.650 -6.41 -0.25 164,506 SUNDANCE RESOURCES LTD 0.325 -9.72 -0.04 39,764

WESTPAC BANKING 24.860 -0.04 -0.01 128,298VIRGIN AUSTRALIA HOLDINGS

LT0.505 5.21 0.03 34,175

NEWCREST MINING 26.700 0.00 0.00 127,268 BLUESCOPE STEEL LTD 0.365 -2.67 -0.01 22,335

AUST AND NZ BANK 24.980 0.16 0.04 118,556 TRITON GOLD LTD 0.094 -6.00 -0.01 20,748

WESFARMERS LTD 34.410 0.32 0.11 77,197 ATLAS IRON LTD 1.460 -2.99 -0.05 20,621

Source: Bloomberg

Commodities % Chg Chg Last Price of S$1 Price of US$1

GOLD SPOT (US$/OZ) -0.02 -0.35 1,656.50 0.7702 1.0364

SILVER SPOT (US$/OZ) -0.06 -0.02 30.75 0.7884 0.9877

WTI Cushing Crude Oil Spot Price (US$/bbl) -0.87 -0.84 95.49 0.6371 1.2527

0.5042 1.5832

0.7983 1.0000

Commodities % Chg Chg Last 5.0710 6.3528

Malaysian Rubber Board Standard (MYR/kg) -0.06 -0.50 795.50 6.1912 7.7557

PALM OIL (MYR/Metric Tonne) -1.73 -51.50 2,933.00 62.8600 78.7500

906.2479 1135.0300

Index % Chg Chg Last 2.4918 3.1215

DOLLAR INDEX SPOT +0.22 +0.18 81.55 25.0160 31.3400

Source: Bloomberg

JAPANESE YEN

KOREAN WON

MALAYSIAN RINGGIT

THAI BAHT

US DOLLAR

CHINA RENMINBI

HONG KONG DOLLAR

CANADIAN DOLLAR

EURO

BRITISH POUND

Currencies

AUSTRALIAN DOLLAR

Commodities & Currencies

Maturity Today Yesterday Last Week Last Month

3 Months 0.08 0.07 0.08 0.08

6 Months 0.13 0.13 0.12 0.12

2 Years 0.26 0.26 0.25 0.22

3 Years 0.36 0.35 0.35 0.30

5 Years 0.68 0.67 0.69 0.61

10 Years 1.65 1.63 1.69 1.50

30 Years 2.76 2.75 2.80 2.58

Yield Spread (10 yrs - 3 mths)

Yield Spread (10 yrs - 2 yrs)

US Treasury Yields

1.57

1.39

Source: Data provided by ValuBond – http://w w w .valubond.com

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Date Statistic For Survey Prior Date Statistic For Survey Prior

8/29/2012 MBA Mortgage Applications 24-Aug -- -7.40% 8/31/2012 Credit Card Bad Debts Jul -- 18.0M

8/29/2012 GDP QoQ (Annualized) 2Q S 1.70% 1.50% 8/31/2012 Credit Card Billings Jul -- 3188.3M

8/29/2012 Personal Consumption 2Q S 1.50% 1.50% 8/31/2012 Bank Loans & Advances (YoY) Jul -- 20.90%

8/29/2012 GDP Price Index 2Q S 1.60% 1.60% 8/31/2012 M1 Money Supply (YoY) Jul -- 6.60%

8/29/2012 Core PCE QoQ 2Q S 1.80% 1.80% 8/31/2012 M2 Money Supply (YoY) Jul -- 6.50%

8/29/2012 Pending Home Sales MoM Jul 1.00% -1.40% 9/4/2012 Electronics Sector Index Aug -- 49.2

8/29/2012 Pending Home Sales YoY Jul 11.10% 8.40% 9/4/2012 Purchasing Managers Index Aug -- 49.8

8/30/2012 Fed's Beige Book 9/5/2012 Automobile COE Open Bid Cat A 5-Sep -- 66889

8/30/2012 Personal Income Jul 0.30% 0.50% 9/5/2012 Automobile COE Open Bid Cat B 5-Sep -- 88002

8/30/2012 Personal Spending Jul 0.50% 0.00% 9/5/2012 Automobile COE Open Bid Cat E 5-Sep -- 93990

8/30/2012 PCE Deflator (MoM) Jul 0.10% 0.10% 9/7/2012 Foreign Reserves Aug -- $244.14B

8/30/2012 PCE Deflator (YoY) Jul 1.40% 1.50% 9/11/2012 Singapore Manpow er Survey 4Q -- 23%

8/30/2012 PCE Core (MoM) Jul 0.10% 0.20% 9/14/2012 Unemployment Rate (sa) 2Q F -- 2.00%

8/30/2012 PCE Core (YoY) Jul 1.70% 1.80% 9/14/2012 Retail Sales Ex Auto (YoY) Jul -- 2.30%

8/30/2012 Initial Jobless Claims 25-Aug 370K 372K 9/14/2012 Retail Sales (YoY) Jul -- -0.90%

Date Statistic For Survey Prior Date Statistic For Survey Prior

8/29/2012 Customs Exports (YoY) Jul -3.75% -2.50% 8/30/2012 Retail Sales - Value (YoY) Jul 8.80% 11.00%

8/29/2012 Customs Imports (YoY) Jul 10.70% 4.41% 8/30/2012 Retail Sales - Volume (YoY) Jul 6.40% 8.50%

8/29/2012 Customs Trade Balance Jul -$82M -$550M 8/31/2012 Money Supply M1 - in HK$ (YoY) Jul -- 7.20%

8/31/2012 Foreign Reserves 24-Aug -- $175.9B 8/31/2012 Money Supply M2 - in HK$ (YoY) Jul -- 6.20%

8/31/2012 Forw ard Contracts 24-Aug -- $28.5B 8/31/2012 Money Supply M3 - in HK$ (YoY) Jul -- 6.10%

8/31/2012 Total Exports YOY% Jul -- -4.30% 8/31/2012 Govt Mthly Budget Surp/Def HK$ Jul -- -0.8B

8/31/2012 Total Exports in US$ Million Jul -- $19507M 03-05 SEP Purchasing Managers Index Aug -- 50.3

8/31/2012 Total Imports YOY% Jul -- 5.00% 9/7/2012 Foreign Currency Reserves Aug -- $296.2B

8/31/2012 Total Imports in US$ Million Jul -- $17864M 9/11/2012 Hong Kong Manpow er Survey 4Q -- 15%

8/31/2012 Total Trade Balance Jul -- $1644M 9/13/2012 Industrial Production (YoY) 2Q -- -1.60%

8/31/2012 Current Account Balance (USD) Jul $730M $604M 9/13/2012 Producer Price (YoY) 2Q -- 3.60%

8/31/2012 Overall Balance in US$ Million Jul -- $519M 9/18/2012 Unemployment Rate SA Aug -- 3.20%

8/31/2012 Business Sentiment Index Jul -- 51.5 9/18/2012 Govt Mthly Budget Surp/Def HK$ Aug -- --

9/3/2012 Consumer Price Index (YoY) Aug 2.60% 2.73% 9/19/2012 Composite Interest Rate Aug -- 0.40%

9/3/2012 Consumer Price Index NSA (MoM) Aug -- 0.35% 9/20/2012 CPI - Composite Index (YoY) Aug -- 1.60%

US Singapore

Economic Announcement

Source: Bloomberg Source: Bloomberg

Thailand Hong Kong

Source: Bloomberg Source: Bloomberg

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Date Statistic For Survey Prior Date Statistic For Survey Prior

9/3/2012Indonesia August Markit

Manufacturing PMI8/30/2012 CPI Moving Average (YoY) Aug -- 6.00%

9/3/2012 Inflation (YoY) Aug -- 4.56% 8/30/2012 CPI (YoY) Aug -- 9.80%

9/3/2012 Inflation NSA (MoM) Aug -- 0.70% 10-20 SEP Exports YoY% Jul -- -7.90%

9/3/2012 Core Inflation (YoY) Aug -- 4.28% 10-20 SEP Imports YoY% Jul -- -15.00%

9/3/2012 Exports (YoY) Jul -- -16.40% 14-28 SEP GDP (YoY) 2Q -- 7.90%

9/3/2012 Total Imports (YoY) Jul -- 10.70% 9/18/2012 Repurchase Rate 18-Sep -- 7.75%

9/3/2012 Total Trade Balance Jul -- -$1322M 9/18/2012 Reverse Repo Rate 18-Sep -- 9.75%

03-07 SEP Danareksa Consumer Confidence Aug -- 91.4 9/28/2012 CPI Moving Average (YoY) Sep -- --

03-04 SEP Consumer Confidence Index Aug -- 113.5 9/28/2012 CPI (YoY) Sep -- --

03-06 SEP Foreign Reserves Aug -- $106.56B 10-19 OCT Exports YoY% Aug -- --

03-06 SEP Net Foreign Assets (IDR Tln) Aug -- 977.16T 10-19 OCT Imports YoY% Aug -- --

07-13 SEP Money Supply - M1 (YoY) Jul -- 22.50% 10/16/2012 Repurchase Rate 16-Oct -- --

07-13 SEP Money Supply - M2 (YoY) Jul -- 20.90% 10/16/2012 Reverse Repo Rate 16-Oct -- --

12-20 SEP Total Local Auto Sales Aug -- 102512 10/31/2012 CPI Moving Average (YoY) Oct -- --

12-20 SEP Total Motorcycle Sales Aug -- 579077 10/31/2012 CPI (YoY) Oct -- --

Date Statistic For Survey Prior

8/29/2012 Construction Work Done 2Q 0.50% 5.50%

8/30/2012 Private Capital Expenditure 2Q 3.00% 6.10%

8/30/2012 Building Approvals (MoM) Jul -5.00% -2.50%

8/30/2012 Building Approvals (YoY) Jul 6.00% 10.20%

8/31/2012 Private Sector Credit MoM% Jul 0.40% 0.30%

8/31/2012 Private Sector Credit YoY% Jul 4.40% 4.40%

9/3/2012 AiG Performance of Mfg Index Aug -- 40.3

9/3/2012 TD Securities Inflation MoM% Aug -- 0.20%

9/3/2012 TD Securities Inflation YoY% Aug -- 1.50%

9/3/2012 Company Operating Profit QoQ% 2Q -- -4.00%

9/3/2012 Inventories 2Q -- 0.90%

9/3/2012 Retail Sales s.a. (MoM) Jul -- 1.00%

9/3/2012 ANZ Job Advertisements (MoM) Aug -- -0.80%

9/3/2012 RBA Commodity Price Index Au Aug -- 95.8

9/3/2012 RBA Commodity Index SDR Aug -- -9.80%

Source: Bloomberg

Source: Bloomberg

Indonesia

Australia

Sri Lanka

Source: Bloomberg

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Important Information

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Contact Information (Singapore Research Team)

Chan Wai Chee Lee Kok Joo, CFA Joshua Tan CEO, Research Head of Research Macro Strategist

Special Opportunities S-Chips, Strategy Global Macro, Asset Strategy +65 6531 1231 +65 6531 1685 +65 6531 1249

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Gaming, US Property Transportation, Telecom. +65 6531 1791 +65 6531 1792 +65 6531 1221

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Financials REITS Global Macro, Asset Strategy +65 6531 1793 +65 6531 1229 +65 6531 1735

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Global Macro, Asset Strategy Commodities +65 6531 1240 (Phone) +65 6531 1535 +65 6531 5440 +65 6336 7607 (Fax)

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SINGAPORE

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MALAYSIA

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HONG KONG

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JAPAN

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