Guangzhou has fallen!

https://news.cgtn.com/news/2020-02-03/Coronavirus-detected-on-doorknob-in-S-China-s-Guangzhou-NMua1LcOWY/index.html

The coronavirus has spread to Guangzhou.

It looks like community transmission has occurred in China.

China is trying very hard to keep Beijing safe now.  All hell will break loose if Beijing cannot be free from the virus outbreak.

China can stabilize its stock markets but not the real economy.

https://www.reuters.com/article/us-china-market-regulator-guidance/china-regulator-urges-fund-managers-not-to-sell-shares-unless-they-face-redemptions-sources-idUSKBN1ZX0C4

China is trying to stabilize its financial sector by asking fund managers not to sell stocks and also pump monetary liquidity into its financial system.  Although China will be able to rein in the financial repercussions from the virus outbreak, the real economy will be badly affected because consumption will drop into the abyss.

https://finance.yahoo.com/news/china-oil-demand-plunged-20-231351018.html

China's oil demand had plunged by 20% since the start of the outbreak.

The other sectors like retail, tourism, F&B, transportation, etc, are all badly affected because the Chinese are trying to cut down on human interactions.  When there is no human activity, there is no economic value.  Any monetary or fiscal policy will be useless in stimulating the economy unless the virus can be contained or eliminated.

The whole world will be severely affected when China starts to reduce its imports significantly due to the rapid deterioration in its local consumption.

Is the January 2020 PMI an aberration?

-->

The ISM PMI rose to 50.9 in Jan 2020 primarily due to a huge increase in the new order that also led to increases in customers’ inventories and production.

The prices rose to 53.3 due to an increase in imports and a reduction in the local raw material.  This PMI might be a precursor to an improvement in the next US GDP growth.  However, the coronavirus epidemic might also thwart this turnaround.  Therefore, we need to observe the epidemic situation closely to determine if this turnaround in US economic growth will materialize in the foreseeable future or not.

http://sg-stock.blogspot.com/2020/01/the-us-ism-pmi-declined-again-in.html

Geo Energy - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/04/19	phillip	Geo Energy	0.176	0.245	Buy
02/13/19	phillip	Geo Energy	0.198	0.245	Buy
03/18/19	phillip	Geo Energy	0.183	0.245	Buy
03/25/19	phillip	Geo Energy	0.186	0.215	Accumulate	PER10x
03/26/19	Amfrasers	Geo Energy	0.182	0.19	Hold	DCF
04/26/19	phillip	Geo Energy	0.176	0.215	Accumulate
05/29/19	phillip	Geo Energy	0.148	0.15	Neutral	PER10x
06/03/19	phillip	Geo Energy	0.149	0.15	Neutral
07/04/19	phillip	Geo Energy	0.155	0.15	Neutral
08/29/19	Amfrasers	Geo Energy	0.15	0.14	Neutral	DCF
09/24/19	Amfrasers	Geo Energy	0.148	0.14	Neutral	DCF

Genting - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/02/19	DMG & Partners	Genting	0.975	1.23	Buy	DCF
01/15/19	Kim Eng	Genting	1.03	1.26	Buy	EV/Ebitda9x FY19
01/28/19	UOB Kay Hian	Genting	1.06	1.38	Buy	EV/Ebitda10x FY19
02/15/19	DMG & Partners	Genting	1.1	1.23	Buy	DCF
02/22/19	CIMB	Genting	1.11	1.28	Add	EV/Ebitda9x CY20
02/22/19	OCBC	Genting	1.11	1.31	Buy	FCFE
02/22/19	DMG & Partners	Genting	1.11	1.22	Buy	DCF
02/22/19	UOB Kay Hian	Genting	1.11	1.32	Buy
02/22/19	Kim Eng	Genting	1.11	1.26	Buy	EV/Ebitda9x FY19
02/25/19	DBS Vickers	Genting	1.07	1.54	Buy	EV/Ebitda12x
03/13/19	DMG & Partners	Genting	1.02	1.22	Buy
03/26/19	CIMB	Genting	1.03	1.28	Add
04/04/19	UOB Kay Hian	Genting	1.07	1.26	Buy	EV/Ebitda 9x
04/04/19	DMG & Partners	Genting	1.07	1.08	Neutral	DCF
04/04/19	CIMB	Genting	1.07	1.11	Add	EV/Ebitda8x
04/04/19	OCBC	Genting	1.07	1.31	Buy
04/04/19	DBS Vickers	Genting	1.07	1.54	Buy	EV/Ebitda 12x
04/04/19	Kim Eng	Genting	1.07	1.12	Hold	EV/Ebitda 8x FY19
04/04/19	Citibank	Genting	1.07	1.28	Buy
05/10/19	Kim Eng	Genting	0.95	1.04	Hold
05/10/19	OCBC	Genting	0.95	1.23	Buy
05/10/19	DMG & Partners	Genting	0.95	1.02	Neutral	DCF
05/10/19	CIMB	Genting	0.95	1.06	Add	EV/Ebitda8x CY20
05/10/19	UOB Kay Hian	Genting	0.95	1.26	Buy
05/10/19	DBS Vickers	Genting	0.95	1.2	Buy	DCF
05/10/19	Citibank	Genting	0.95	1.16	Buy
06/06/19	DMG & Partners	Genting	0.86	1.02	Neutral
06/24/19	CIMB	Genting	0.93	1.06	Add
08/05/19	DMG & Partners	Genting	0.9	0.97	Neutral	EV/Ebitda7x FY19
08/05/19	UOB Kay Hian	Genting	0.9	1.11	Buy
08/06/19	Kim Eng	Genting	0.885	0.99	Hold
08/06/19	Citibank	Genting	0.885	1.07	Buy
08/06/19	CIMB	Genting	0.885	1	Add	EV/Ebitda8x CY20
08/06/19	DBS Vickers	Genting	0.885	1.2	Buy
08/06/19	Lim & Tan	Genting	0.885	0	Hold
10/01/19	DBS Vickers	Genting	0.88	1.2	Buy
10/11/19	DMG & Partners	Genting	0.9	0.97	Neutral
10/25/19	UOB Kay Hian	Genting	0.925	1.11	Buy
11/08/19	Kim Eng	Genting	0.96	0.99	Hold	EV/Ebitda7x FY20
11/08/19	DMG & Partners	Genting	0.96	0.97	Neutral	EV/Ebitda7x FY20
11/08/19	UOB Kay Hian	Genting	0.96	1.11	Buy
12/11/19	DMG & Partners	Genting	0.915	0.97	Neutral
01/14/20	DBS Vickers	Genting	0.92	1.2	Buy

Fu Yu - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/02/19	DMG & Partners	Fu Yu	0.19	0.23	Buy	DCF
01/04/19	UOB Kay Hian	Fu Yu	0.186	0.27	Buy	EV/Ebitda 5.3x FY19
01/15/19	CIMB	Fu Yu	0.2	0.2	Hold	PB0.9x
02/08/19	UOB Kay Hian	Fu Yu	0.205	0.27	Buy
02/27/19	UOB Kay Hian	Fu Yu	0.21	0.285	Buy
02/27/19	Lim & Tan	Fu Yu	0.21	0	Buy
02/28/19	DMG & Partners	Fu Yu	0.215	0.24	Buy	DCF
02/28/19	CIMB	Fu Yu	0.215	0.2	Hold
03/13/19	DMG & Partners	Fu Yu	0.205	0.24	Buy
03/26/19	UOB Kay Hian	Fu Yu	0.2	0.285	Buy
04/15/19	UOB Kay Hian	Fu Yu	0.205	0.285	Buy	EV/Ebitda5.5x
05/07/19	DMG & Partners	Fu Yu	0.21	0.24	Buy	DCF
05/10/19	UOB Kay Hian	Fu Yu	0.205	0.285	Buy
05/10/19	Lim & Tan	Fu Yu	0.205	0	Buy
06/06/19	DMG & Partners	Fu Yu	0.19	0.24	Buy
06/13/19	UOB Kay Hian	Fu Yu	0.2	0.29	Buy
07/09/19	DMG & Partners	Fu Yu	0.215	0.24	Buy	DCF
07/15/19	UOB Kay Hian	Fu Yu	0.215	0.29	Buy
08/14/19	Lim & Tan	Fu Yu	0.215	0	Buy
08/14/19	DMG & Partners	Fu Yu	0.215	0.24	Buy	DCF
08/14/19	UOB Kay Hian	Fu Yu	0.215	0.285	Buy
09/11/19	DMG & Partners	Fu Yu	0.215	0.24	Buy
09/16/19	UOB Kay Hian	Fu Yu	0.23	0.285	Buy	EV/Ebitda5.7x FY19
10/02/19	DMG & Partners	Fu Yu	0.22	0.24	Buy	DCF
10/09/19	UOB Kay Hian	Fu Yu	0.225	0.285	Buy
11/12/19	UOB Kay Hian	Fu Yu	0.225	0.285	Buy
11/14/19	DMG & Partners	Fu Yu	0.225	0.24	Buy	DCF
11/14/19	Lim & Tan	Fu Yu	0.225	0	Buy
11/29/19	UOB Kay Hian	Fu Yu	0.235	0.295	Buy
12/10/19	DMG & Partners	Fu Yu	0.25	0.27	Buy	DCF
12/13/19	Lim & Tan	Fu Yu	0.25	0	Buy
01/08/20	DMG & Partners	Fu Yu	0.255	0.27	Buy
01/15/20	DBS Vickers	Fu Yu	0.25	0.35	Buy	PER16x FY20
01/15/20	DMG & Partners	Fu Yu	0.25	0.29	Buy	DCF

Stock calls for 3 February 2020

Date	Analyst	Company	Last	Target	Call	Valuation
02/03/20	UOB Kay Hian	A-Reit	3.15	3.35	Buy	DDM
02/03/20	DMG & Partners	A-Reit	3.15	3.1	Neutral	DDM
02/03/20	CIMB	A-Reit	3.15	3.14	Hold
02/03/20	Kim Eng	AIMS AMP Cap Ind Reit	1.46	1.6	Buy	DDM
02/03/20	UOB Kay Hian	ART	1.26	1.57	Buy
02/03/20	OCBC	CDL Hospitality	1.56	1.62	Hold
02/03/20	Kim Eng	CDL Hospitality	1.56	1.75	Buy
02/03/20	UOB Kay Hian	CDL Hospitality	1.56	1.89	Buy
02/03/20	DBS Vickers	Far East Hospitality	0.68	0.69	Hold	PB0.85x
02/03/20	OCBC	Frasers Centrepoint Trust	2.88	2.93	Hold
02/03/20	OCBC	Mapletree Commercial	2.35	2.44	Hold
02/03/20	DBS Vickers	OCBC	10.83	11.5	Hold
02/03/20	OCBC	OUE Commercial	0.545	0.55	Hold
02/03/20	DBS Vickers	OUE Commercial	0.545	0.6	Buy	DCF
02/03/20	DBS Vickers	UOB	25.66	29.2	Buy

Red alert - H5N1 bird flu outbreak in Hunan.

https://www.channelnewsasia.com/news/asia/china-reports-h5n1-bird-flu-outbreak-hunan-wuhan-coronavirus-12381796

China has not managed to contain the coronavirus yet and H5N1 outbreak has started in Hunan.  It is estimated that the coronavirus will reach its peak in April 2020 before it subsides.

With these 2 viruses circulating in China, there is a high possibility that 1 quarter GDP growth will be wiped out in China.  It will be impossible for China to maintain a 6% GDP growth in 2020.

What happened to those cities under lockdown in China?

The markets, streets and malls are all empty and look like a ghost city.

When there is no human activity, there is no economic value.  Therefore, the 16 cities under lockdown with an estimated 60m people will be greatly impacted economically because China is a consumption-led economy now.  Furthermore, China is being increasingly ostracized by many countries as the Chinese are being denied entries.  The world is looking at China Chinese as locusts now.

There is also some speculation that the fatality rate of the coronavirus is much higher than stated because China is labelling the cause of death as visceral organ failure for those who die due to the virus.  The economic consequence will be much greater in 2020 than the SARS in 2003 because China's GDP in 2003 was only US$1.66T.  Moreover, China's economic contribution to the world is now at 39%.

http://sg-stock.blogspot.com/2018/10/china-gdp-was-growing-at-65-in-q3-2018.html

Baltic dry index - 487

Today, Friday, January 31 2020, the Baltic Dry Index decreased by 11 points, reaching 487 points.

Baltic Dry Index is compiled by the London-based Baltic Exchange and covers prices for transported cargo such as coal, grain and iron ore. The index is based on a daily survey of agents all over the world. Baltic Dry hit a temporary peak on May 20, 2008, when the index hit 11,793. The lowest level ever reached was on Wednesday the 10th of February 2016, when the index dropped to 290 points.

=========================

Related stock: Sembcorp Marine, Cosco & Pan ocean.

US rig count - 790

Related stock: Keppel Corp, Sembcorp Marine & Cosco.

The US yield curve inversion has happened again in 2020!

The 10-year yield is 1.51% which is lower than 1-m, 2-m, 3-m and 4-m.

We hit the nail on Luckin Coffee.

https://www.investors.com/news/luckin-coffee-stock-falls-muddy-waters-report-fraud/?src=A00220&yptr=yahoo

Muddy Waters has targeted Luckin Coffee.

We had warned about Luckin Coffee in May 2019.

http://sg-stock.blogspot.com/2019/05/do-not-subscribe-to-luckin-coffee-ipo.html

http://sg-stock.blogspot.com/2019/05/luckin-has-fallen-below-its-ipo-price.html

The difference between a normal chest x-ray vs coronavirus chest x-ray.

Normal chest x-ray with clear visibility of ribs.

Coronavirus chest x-ray with foggy visibility.

The coronavirus has destroyed the lung's capability to breathe.

Human to human transmission has started for coronavirus.

https://www.channelnewsasia.com/news/asia/wuhan-virus-thailand-first-human-coronavirus-transmission-12374356

https://www.cnbc.com/2020/01/30/cdc-confirms-first-human-to-human-transmission-of-coronavirus-in-us.html

The US and Thailand have reported human to human transmission cases.  Although the fatality rate is much lower than SARS, the economic impacts will be much greater than SARS since there are more people getting infected by this new virus.

Frencken - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
03/12/19	Amfrasers	Frencken	0.51	0.67	Buy	PER10x FY19
04/15/19	DBS Vickers	Frencken	0.6	0.75	Buy	PER8.5x FY19/20
04/17/19	CIMB	Frencken	0.635	0.9	Add	PER10x FY20
05/09/19	DMG & Partners	Frencken	0.615	0.82	Buy	DCF
05/10/19	DBS Vickers	Frencken	0.615	0.75	Buy	PER8.5x FY19/20
05/10/19	Lim & Tan	Frencken	0.615	0	Buy
05/10/19	CIMB	Frencken	0.615	0.9	Add
05/14/19	Amfrasers	Frencken	0.595	0.67	Buy	PER10x FY19
06/12/19	DMG & Partners	Frencken	0.625	0.82	Buy	DCF
08/13/19	DBS Vickers	Frencken	0.66	0.8	Buy
08/13/19	CIMB	Frencken	0.66	0.9	Add
08/13/19	DMG & Partners	Frencken	0.66	0.82	Buy	DCF
08/13/19	DBS Vickers	Frencken	0.66	0.8	Buy	PER8.5x
08/22/19	CIMB	Frencken	0.73	0.95	Add
08/22/19	Amfrasers	Frencken	0.73	0.81	Neutral	PER10x FY20
09/11/19	Amfrasers	Frencken	0.675	0.81	outperform	PER10x FY20
10/08/19	DMG & Partners	Frencken	0.675	0.82	Buy
11/07/19	CIMB	Frencken	0.72	0.94	Add	PER10x FY20
11/07/19	Amfrasers	Frencken	0.72	0.93	outperform	PER10x FY20
11/07/19	DBS Vickers	Frencken	0.72	0.95	Buy	PER9x FY20
11/11/19	DMG & Partners	Frencken	0.76	0.82	Buy	DCF
11/18/19	Amfrasers	Frencken	0.92	0.93	Neutral	PER10x FY20
11/29/19	DBS Vickers	Frencken	0.905	1.06	Buy	PER10x FY20
12/02/19	Amfrasers	Frencken	0.89	0.93	outperform	PER10x FY20
12/10/19	DMG & Partners	Frencken	0.94	0.92	Neutral	DCF
01/24/20	DBS Vickers	Frencken	0.91	1.06	Buy	PER10x FY20

Frasers Property - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/17/19	DBS Vickers	Frasers Property	1.74	1.98	Buy	RNAV (35% discount)
02/14/19	CIMB	Frasers Property	1.7	2.08	Add
02/14/19	DBS Vickers	Frasers Property	1.7	1.98	Buy	RNAV (35% discount)
03/22/19	DBS Vickers	Frasers Property	1.77	1.98	Buy	RNAV (35% discount)
04/08/19	DBS Vickers	Frasers Property	1.81	1.98	Buy
04/10/19	DBS Vickers	Frasers Property	1.84	2.3	Buy	RNAV (35% discount)
05/06/19	DBS Vickers	Frasers Property	1.89	2.3	Buy	RNAV (35% discount)
05/07/19	CIMB	Frasers Property	1.85	2.08	Add
11/18/19	DBS Vickers	Frasers Property	1.82	2.05	Buy	RNAV (40% discount)

Frasers Logistics - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/28/19	DBS Vickers	Frasers Logistics	1.06	1.2	Buy	DCF
01/28/19	OCBC	Frasers Logistics	1.06	1.19	Buy
01/28/19	CIMB	Frasers Logistics	1.06	1.19	Add
02/08/19	DBS Vickers	Frasers Logistics	1.09	1.2	Buy
04/03/19	DBS Vickers	Frasers Logistics	1.16	1.2	Buy
04/30/19	OCBC	Frasers Logistics	1.18	1.2	Hold
05/02/19	CIMB	Frasers Logistics	1.18	1.21	Hold	DDM
06/28/19	OCBC	Frasers Logistics	1.19	1.2	Hold
07/04/19	OCBC	Frasers Logistics	1.23	1.2	Hold
07/04/19	Lim & Tan	Frasers Logistics	1.23	0	Hold
07/04/19	CIMB	Frasers Logistics	1.23	1.25	Hold
08/21/19	CIMB	Frasers Logistics	1.2	1.27	Add
08/21/19	OCBC	Frasers Logistics	1.2	1.22	Hold
11/06/19	Lim & Tan	Frasers Logistics	1.25	0	Hold
11/07/19	OCBC	Frasers Logistics	1.26	1.28	Hold
11/07/19	DBS Vickers	Frasers Logistics	1.26	1.4	Buy	DCF
11/07/19	CIMB	Frasers Logistics	1.26	1.31	Add
12/03/19	CIMB	Frasers Logistics	1.24	1.31	Add

Stock calls for 31 January 2020

Date	Analyst	Company	Last	Target	Call	Valuation
01/31/20	Lim & Tan	AIMS AMP Cap Ind Reit	1.43	0	Hold
01/31/20	Kim Eng	ART	1.27	1.4	Hold	DDM
01/31/20	DBS Vickers	ART	1.27	1.5	Buy
01/31/20	OCBC	Cache Logistics	0.715	0.74	Hold
01/31/20	DMG & Partners	CDL Hospitality	1.56	1.62	Neutral	DDM
01/31/20	DBS Vickers	CDL Hospitality	1.56	1.75	Buy	DCF
01/31/20	CIMB	First Reit	1.02	1.15	Add	DDM
01/31/20	CIMB	Japfa	0.56	0.69	Add
01/31/20	Kim Eng	Japfa	0.56	0.72	Buy
01/31/20	CIMB	Mapletree Logistics	1.85	1.59	Hold
01/31/20	phillip	SGX	8.7	8.52	Neutral	PER21.5x

The US GDP growth exceeds expectations.

https://www.whitehouse.gov/articles/united-states-gdp-growth-continues-exceeding-expectations/

Just as we expected, the US 4th quarter GDP growth came out well at 2.1% but it was just an illusion because consumer spending declined significantly.

http://sg-stock.blogspot.com/2020/01/the-upcoming-us-gdp-will-be-better.html