Welcome to our latest edition of top stock market highlights where we feature interesting snippets from business news and corporate events.
Singapore savings bonds
With interest rates rising rapidly, savers are finally seeing better days.
The latest Singapore Savings Bond (SSB) is offering an all-time high interest for its December 2022 tranche.
Investors can enjoy the first-year interest of 3.26% with a 10-year average return of 3.47%.
This rate is higher than November’s tranche, which offered a first-year interest rate of 3.08% and a 10-year average return of 3.21%.
SSBs are guaranteed by the government and offer a haven for investors to park their money amid the volatile stock market.
Notably, the December 2022 SSB’s 10-year average return is nearly double the 1.78% offered by the January 2022 tranche.
The applications for the SSB close on 25 November and allotment for the December 2022 tranche is S$1 billion.
US Federal Reserve
In recent months, all eyes have been on the US Federal Reserve as it aggressively hikes interest rates to fight the highest inflation in four decades.
For its November meeting, the US central bank continued with its sharp interest rate increases, delivering its fourth consecutive 0.75 percentage point increase, taking the benchmark rate to a range of between 3.75% to 4%.
These rapid hikes have stoked fears of an impending recession as consumers are battered by higher mortgage rates and businesses are faced with higher borrowing costs.
Shares got battered once again as the Federal Reserve signalled its resolve to continue raising rates until inflation is brought down to 2%.
Chairman Jerome Powell made it clear that rate hikes will not be paused until the central bank’s job is done, but the committee is considering slowing the pace of rate hikes beginning with its December meeting.
Ultimately, interest rates may end up higher than what was originally communicated but the path to getting there will be extended.
Investors have to contend with more frequent rate hikes but of smaller increments than the jumbo hikes that the Federal Reserve had made in the past several months.
Wilmar International Limited (SGX: F34)
Wilmar reported its third consecutive set of record earnings for its fiscal 2022’s third quarter (3Q2022).
Revenue increased by 10.2% year on year to US$18.9 billion while core net profit surged by 38.2% year on year to US$796.7 million.
The integrated agribusiness group saw good performance across all its business segments.
The sales volume for its Feed and Industrial Products division rose 8.5% year on year to 14.7 million metric tonnes (MT), led by a 12.7% year on year increase in Oilseeds and Grains to 5.6 million MT.
Wilmar’s Food Products division saw sales volume inch up 3.2% year on year to 7.7 million MT.
Meanwhile, operating cash flow soared 68.2% year on year to US$3.5 billion, raising the possibility of a higher final dividend when the group reports its FY2022 results.
Wilmar is confident that its diversified business model should enable it to weather any economic challenges and achieve a satisfactory performance for the remainder of 2022.
Nanofilm Technologies International Ltd (SGX: MZH)
Nanofilm Technologies posted revenue growth of 10% year on year for the first nine months of 2022 (9M2022).
The nanotechnology specialist also provided an update on business developments during its 3Q2022 business update.
The group plans to expand its production facilities by establishing a second production facility of around 40,000 square metres in Hanoi, Vietnam.
The acquisition of the land use rights is expected to complete by the first quarter of next year.
Aside from this initiative, Nanofilm also plans to expand its business in green energy and is seeing good momentum in Sydrogen, its hydrogen business.
For Sydrogen, the unit has started production of bipolar plate coatings and is slated to develop fuel cell system demonstrators.
The engineering group has set its 2025 targets to focus on three key end-markets – consumer, industrial, and new energy.
It also plans to introduce coating as a service and emphasize value chain integration.
Nanofilm targets to achieve S$500 million in revenue by 2025 along with a net profit of S$100 million.
For perspective, the group’s FY2021 revenue was S$246.7 million while net profit came in at S$62.2 million.
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.