S&P 500 outpacing rival Dow as stocks rally

BOSTON (MarketWatch) — The S&P 500 Index and the Dow Jones Industrial Average are commonly used to measure the performance of U.S. stocks, but the disparity in the benchmarks’ returns this year during the powerful rally highlights their different approaches to tracking the market.

So far in 2009 through Wednesday’s close, the S&P 500 (SPX 1,092, +18.83, +1.75%) had posted a year-to-date gain of 17.1%, handily outpacing the Dow’s(INDU 10,016, +144.95, +1.47%) 10.8% rise.

“While the Dow Jones Industrial Average and the S&P 500 share the spotlight as the two most-watched measures of the U.S. equity markets, the behavior of these indexes does vary considerably based on market conditions,” said Nicholas Colas, chief market strategist at ConvergEx.

“During up-trending markets, the broader based S&P 500 has the edge. During down markets, however, the Dow outperforms,” Colas wrote in a report Thursday. “The recent weakness in the U.S. dollar should benefit the more multinational Dow, especially if the greenback’s weakness spurs a long-awaited market correction.”

The performance gap between the S&P 500 and the Dow is due to several key methodology differences, even though investors see both indexes used in media reports recapping the market’s daily moves.

First, the 30 stock components in the venerable Dow are weighted by share price. The S&P 500, on the other hand, uses a market-capitalization-weighting strategy.

The broader S&P 500 holds a greater number of stocks and so digs deeper into markets by holding more smaller-cap companies. Read earlier story profiling the indexes.

Blue-chip battle

Both indexes have a subjective element because the stocks are selected by people rather than by objective rules. The stocks in the Dow are chosen by the editors of The Wall Street Journal, while an index committee maintains the S&P 500.

The Dow Jones Industrial Average was first published in 1896. It was originally made up of a dozen stocks and designed to give investors a gauge of the overall market’s performance.

The modern S&P 500, meanwhile, has been around since the 1950s and today is preferred by investment professionals to track the market. Yet perhaps for nostalgic reasons, the mainstream press often quotes the Dow in market reports.

“The amount of money that tracks the S&P 500 far outweighs that which tracks the Dow Jones Industrial Average, but it is still the Dow that most Americans associate with the U.S. equity markets,” said Colas at ConvergEx. “Just look at any general-interest evening TV newscast; it is the Dow that gets the top billing.”

Nearly $1 trillion in indexed assets tracks the S&P 500, according to Standard & Poor’s. “Although the S&P 500 focuses on the large-cap segment of the market, with approximately 75% coverage of U.S. equities, it is also an ideal proxy for the total market,” says S&P, a unit of McGraw-Hill Cos.

There are index funds and exchange-traded funds tracking both benchmarks. The ETFs include SPDR S&P 500 ETF (SPY 109.33, +0.02, +0.02%), iShares S&P 500 Index Fund(IVV 109.67, -0.03, -0.03%) and Dow Diamonds (DIA 100.25, +0.02, +0.02%).

Explaining the performance gap

Through the end of September, the S&P 500 had a five-year annualized return of 1%. Its ten-year return was slightly in the red at negative 0.2%, according to S&P. The Dow has fared slightly better with a five-year annualized return of 1.9%, and a 10-year gain of 1.6%, according to Dow Jones, which like MarketWatch is owned by News Corp.

“The S&P 500 has performed better in up-trending markets over the past few years. During both this year’s recovery in stocks from their March lows and the longer rally in equities during the mid-1990s, the S&P 500 did better than the Dow,” Colas noted

However, the Dow tends to outperform during strong bear markets. “As equity markets fell in 2007 and 2008, the Dow declined less that the S&P 500,” the strategist said. Even though the indexes tend to perform similarly over longer periods, return differences like those seen this year can “persist for quite some time.”

The S&P 500′s relatively larger tilt to smaller stocks has been helping during the rally that has pushed the index up by 56.3% since the March 9 low, as of Wednesday’s close. The Dow has risen 48.5% since then, according to FactSet Research.

“Smaller-cap stocks (especially those with low stock prices) have been much of the horsepower in the current market rally,” Colas wrote.

Yet if the stock market experiences the correction that many expect, those small stocks “will likely see the brunt of the initial selling.” And if markets again grow skittish over the troubled banking system, the Dow would benefit from its lower exposure to financial stocks compared with the S&P 500. The Dow has a “nonexistent weighting in smaller banks and finance companies,” Colas said.

The Dow would also benefit more if the U.S. dollar keeps sliding, he added. “By virtue of the Dow’s concentration in large multinational companies, it should be better positioned to benefit from the current swoon in the greenback,” Colas observed. “These enterprises should be able to generate incremental profits by repatriating foreign earnings into their home currency, the U.S. dollar.”

John Spence is a reporter for MarketWatch in Boston.

US Mortgage rate inches lower

NEW YORK (MarketWatch) — The national average interest rate on the benchmark 30-year, fixed-rate loan averaged 5.07% in the week ending Thursday, down from last week’s 5.08% and the year-ago 5.93%, according to Freddie Mac’s weekly survey. The 15-year fixed-rate loan averaged 4.50%, down from the week-ago 4.54% and the year-ago 5.54%. The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 4.51%, compared with 4.59% a week ago and 5.87% a year ago. “Mortgage rates remained historically low over the past two weeks, keeping housing very affordable,” said Frank Nothaft, Freddie Mac’s vice president and chief economist. “As a result, mortgage applications leapt 17% over the week ending Sept. 4, led by a 23% jump in refinancing demand, according [to] the Mortgage Bankers Association.”

Apple New product

Apple Premieres iTunes 9

September 9, 2009

Apple today introduced iTunes 9, the latest version of the world’s most popular software application to purchase, manage and play media, packed with innovative features such as iTunes LP, Home Sharing and Genius Mixes, as well as a redesigned store and improved syncing. iTunes 9 makes it easier than ever to discover, purchase and enjoy your music, movies, TV shows, and apps for iPhone and iPod touch from Apple’s revolutionary App Store.Filed under: iPod+iTunes. Read more: apple.com/itunes

Apple Introduces New iPod touch Lineup

September 9, 2009

The new iPod touch, starting at just $199, gives you a great iPod, a great pocket computer, a great game player and access to Apple’s revolutionary App Store with over 75,000 applications. iPod touch features Apple’s revolutionary Multi-Touch user interface, a gorgeous 3.5-inch widescreen glass display, Wi-Fi, Bluetooth, and a built-in accelerometer and speaker in an amazingly thin metal design that slips easily into your pocket.Filed under: iPod+iTunes. Read more: apple.com/ipodtouch

Apple’s iPod shuffle Now Starts at Just $59

September 9, 2009

The iPod shuffle, the world’s smallest music player and the first music player to talk to you, is available now, starting at just $59, in five great colors. iPod shuffle’s intuitive controls are conveniently located on the headphone cord, letting you navigate and enjoy music without even looking. Filed under: iPod+iTunes. Read more: apple.com/ipodshuffle

Apple Introduces New iPod nano With Built-in Video Camera

September 9, 2009

The new iPod nano adds a video camera, mic and speaker to the world’s most popular music player, allowing you to shoot video wherever you are, view it on your iPod nano and use your computer to easily transfer your videos to YouTube. The new iPod nano—available today in an 8GB model for $149 and a 16GB model for $179—features an ultra-thin and sleek design with a larger 2.2-inch color display and gorgeous polished aluminum and glass enclosure in nine brilliant colors. Filed under: iPod+iTunes.Read more: apple.com/ipodnano

The Causes of Credit Crisis

http://vimeo.com/3261363

Global recession over, but will leave scars: IMF

MARKET PULSE

Aug 18, 2009, 12:18 p.m. EST

Global recession over, but will leave scars: IMF

STORYCOMMENTS SCREENER (32)

AlertEmailPrintShareBy Rex Nutting

WASHINGTON (MarketWatch) — The global recession is over and a recovery has begun, Olivier Blanchard, the top economist for the International Monetary Fund, said Tuesday. “The turnaround will not be simple,” Blancard wrote in an article released by the IMF. “The crisis has left deep scars, which will affect both supply and demand for many years to come.” Growth is coming for most countries, he said, but it won’t be strong enough to reduce unemployment for a while. Potential output may have been permanently reduced. Growth is still highly dependent on government stimulus from fiscal and monetary policies. Sustaining growth “will require delicate rebalancing acts, both within and across countries,” he said.

Credit crunch likely to persist, bankers say

Aug 17, 2009, 2:21 p.m. EST

Credit crunch likely to persist, bankers say

Lenders still clamping down on business, real estate, consumer loans

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Banks

STORYCOMMENTS SCREENER (24)

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By Rex Nutting, MarketWatch

WASHINGTON (MarketWatch) — Banks were still clamping down on lending to businesses and consumers over the past three months, and they said they planned to keep their credit standards tight for at least a year, the Federal Reserve reported Monday.

In its quarterly survey of banks’ senior loan officers, the Fed said lending standards got even tighter for almost every type of loan, from prime residential mortgages to commercial and industrial loans. The survey covered May, June and July.

Banks have been tightening their standards for various types of loans for more than two years. For residential mortgages, banks have tightened their standards for 11 straight quarters by increasing requirements for down payments, interest-rate spreads, or credit scores.

Vanguard’s bold move into bonds

Vanguard is pushing into exchange-traded bond funds. Now bond-fund buyers can expect more choices, says Dan Wiener, editor of the Independent Adviser for Vanguard Investors newsletter.

In the most recent survey, no banks reported easing their terms for residential real estate loans, commercial real estate loans, or consumer credit cards. Less than 4% of banks said they had eased terms on commercial and industrial loans and for home-equity loans.

Tighter lending standards reduce the amount of credit available. The banks also said demand for most types of loans had declined. One exception: Demand for prime-quality residential loans rose slightly, on net.

The Fed asked the banks when they thought their policies would get back in line with their long-term trend. For commercial and industrial loans to businesses, just 13% said conditions would return to normal by the middle of 2010, with another 36% saying it would be in late 2010.

For commercial real estate, just 2% said normal credit policies would return within a year, and 40% said policies would remain tighter than usual for the foreseeable future.

For prime mortgages, 9% said they expected policies to return to normal within a year, and 42% said policies would remain tighter than usual for the foreseeable future.

For nonprime borrowers, a majority of banks said policies would remain tighter than normal for the foreseeable future, and fewer than 10% said standards would normalize within the year.

Details

For commercial and industrial loans, 35% of banks tightened standards for their biggest customers and 36% tightened for smaller customers. Most banks said the uncertain economy was the major reason for tightening credit. No banks eased standards. About 60% of the banks reported falling demand for such loans.

For commercial real estate loans, 47% of banks tightened lending standards and none loosened them. About 70% reported weaker demand.

For prime mortgages, 22% tightened standards and none eased. About 40% reported higher demand. For nontraditional loans, 46% tightened standards and none eased. About 13% reported higher demand. For subprime loans, fewer than three banks responded, so the Fed did not report any results.

For home-equity loans, 36% tightened standards and 4% loosened them. About 28% reported weaker demand.

For credit cards, 36% tightened standards and none eased. About 31% said demand was weaker.

Shanghai skids 5.8%, leads Asian markets down again

Aug 17, 2009, 5:49 a.m. EST

Shanghai skids 5.8%, leads Asian markets down again

Commodity prices’ decline, July FDI slump hands China biggest drop of 2009

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Asia PacificChinaAngang Steel Co LtdAluminum Corp China Ltd

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By V. Phani Kumar, Colin Ng & Wei-Zhe Tan

HONG KONG (MarketWatch) — Shanghai stocks dropped 5.8% Monday, suffering their biggest percentage drop so far this year, as lower commodity prices, persistent worries over tightening in bank loans and weak economic data dampened investor sentiment.

Hong Kong shares were also weighted down by the performance as well as a steep fall in U.S. stock futures and commodity prices. In Tokyo, exporters were dragged down by the yen’s strength as risk-averse investors bought the low-yielding currency in search of a perceived safe haven.

“The U.S. fall on Friday helped to reduce the risk appetite for speculators holding Asian assets, said Ben Collett, head of cash equities at TFS Derivatives. He added, “What we’re seeing is guys getting a little risk averse and cutting their losses.”

China’s Shanghai Composite index posted its biggest percentage drop since November and ended at 2,870.63, its first close below 3,000 since the end of June. In Shenzhen, the main stock index dropped 6.6% to 955.87, while Hong Kong’s Hang Seng Index skidded 3.6% to end at 20,137.65, led lower by a slump in China-related stocks.

SHCOMP
Metals stocks were hit hardest, with Angang Steel(ANGGY 94.15, -0.60, -0.63%) and Yunnan Copper dropping by the day’s 10% limit in Shenzhen, while Aluminum Corp. of China(ACH 27.94, -2.20, -7.30%) and Jiangxi Copper (JIXA.Y 81.91, -11.01, -11.85%)dropped by as much in Shanghai. Sentiment was also hurt after Yunnan Copper reported a loss for the first half of the year.

“The large gains in [China markets in] the first half recreated a bubble in the market, so when the government showed signs of tightening bank credit there’s a selloff,” said Zhang Yong, an analyst at Great Wall Securities.

The drop coincided with data showing foreign direct investment into China slumped 35.7% to $5.36 billion in July from the year-earlier period. Foreign direct investment flows for the first seven months of the year were down 20.3% compared with a year earlier, noted Moody’s Economy.com economist Sherman Chan.

“As the central government is determined to achieve the annual growth target of 8%, policymakers may have to step up efforts to boost momentum in coming months,” she wrote in a report.

Regional markets

Japan’s Nikkei Stock Average of 225 companies ended down 3.1%, Australia’s S&P/ASX 200 ended 1.6% lower, South Korea’s Kospi ended down 2.8% and India’s Sensex was 2.4% lower recently. Taiwan’s Taiex ended 2.0% lower, while New Zealand’s NZX 50 lost 2.1%.

Dow Jones Industrial Average (INDU 9,158, -158.10, -1.70%) futures were recently down 138 points in screen trade, adding to the late selling pressure in the region.

In Tokyo, data showing Japan’s second-quarter gross domestic product registered its first quarterly growth in five quarters, did little for the Tokyo markets. GDP grew 0.9% from the quarter before, compared with a 1.0% rise tipped in a Dow Jones Newswires poll of economists.

Royal Bank of Scotland economist Junko Nishioka, however, noted that capital expenditure by Japanese companies dropped for a fifth straight month.

“As corporate free cash flow decreases, we expect capex to continue to contract throughout the year,” said Ms. Nishioka. “Given exports started to slow down in June, especially to China, and household consumption is quite fragile due to the deterioration in the labor market, we believe GDP will slow in Q3 and beyond. In addition, the effect of the economic stimulus packages is likely to gradually diminish.

Retrenchments Down Sharply And Unemployment Stabilises(SG)

Retrenchments Down Sharply And Unemployment Stabilises

31 July 2009

Employment

1.   According to preliminary estimates, total employment contracted by 12,400 in the second quarter of 2009, double the losses in the first quarter (-6,200). This is the first time that employment has contracted for two consecutive quarters since the 2003 economic downturn.

2.   Manufacturing (-17,600) again bore the brunt of job losses. Construction increased its workforce (3,400) but the gains were lower than in earlier quarters (8,300 in 1Q 2009 and 22,400 in 2Q 2008). Services added 2,100 workers, also showing lower gains than before (7,500 in 1Q 2009 and 38,300 in 2Q 2008).

Table 1: Employment

(In Thousands)

	Employment Change					Employment Level as at Jun 2009 p
	2Q 08	3Q 08	4Q 08	1Q 09	2Q 09p
Total*	71.4	55.7	21.3	-6.2	-12.4	2,933.8
Manufacturing	10.1	4.6	-7.0	-22.1	-17.6	546.6
Construction	22.4	16.5	10.7	8.3	3.4	371.7
Services	38.3	34.3	17.3	7.5	2.1	1,995.6

^P: Preliminary estimates

*: Total includes agriculture, fishing, quarrying, utilities and sewerage & waste management

Data may not add up due to rounding

Retrenchment and Redundancy

3.   According to preliminary estimates, 4,800 workers were retrenched and 700 contracts were terminated prematurely, resulting in a total of 5,500 workers made redundant in the second quarter of 2009. This is less than half the 12,760 redundancies in the first quarter 2009, comprising 10,900 workers retrenched and 1,860 workers whose contracts were terminated prematurely.

Table 2.1: Redundancy

	2Q 08	3Q 08	4Q 08	1Q 09	2Q 09P
Redundancy	1,880	3,180	9,410	12,760	5,500
Retrenchment	1,800	2,350	7,500	10,900	4,800
Early Release of Contract Workers	90	830	1,910	1,860	700

^P:  Preliminary estimates

Data may not add up due to rounding

4.   Redundancies in manufacturing fell sharply to 2,600 from 9,250 in the first quarter of 2009. Services laid off 2,400 workers, lower than the 3,170 in the preceding quarter. The remaining 500 were displaced from construction.

Table 2.2: Redundancy by Sector

	2Q 08	3Q 08	4Q 08	1Q 09	2Q 09P
Total *	1,880	3,180	9,410	12,760	5,500
Manufacturing	1,250	2,260	5,170	9,250	2,600
Construction	20	130	390	330	500
Services	620	790	3,810	3,170	2,400

^P: Preliminary estimates

*: Total includes agriculture, fishing, quarrying, utilities and sewerage & waste management

Data may not add up due to rounding
Unemployment

5.   Preliminary estimates show that the overall unemployment rate stabilised at a seasonally adjusted 3.3% in June 2009, unchanged from a quarter ago. Among the resident labour force, the seasonally adjusted unemployment rate declined from 4.8% in March 2009 to 4.6% in June 2009. In the difficult job market, more people are deferring job searches and pursuing courses, including those supported under SPUR.

Table 3: Unemployment Rate

	Jun 08	Sep 08	Dec 08	Mar 09	Jun 09p
Seasonally Adjusted
Overall (%)	2.2	2.3	2.5	3.3	3.3
Resident (%)	3.1	3.4	3.6	4.8	4.6
Non-Seasonally Adjusted
Overall (%)	2.8	1.9	2.4	3.0	4.2
Resident (%)	4.0	2.8	3.5	4.4	6.0

^P:  Preliminary estimates
6.   On a non-seasonally adjusted basis, the overall unemployment rate rose from 3.0% in March 2009 to 4.2% in June 2009. Among the resident labour force, the non-adjusted unemployment rate was 6.0% in June 2009, higher than the 4.4% in the previous quarter, reflecting the increase in job seekers as tertiary graduates entered the labour market and students sought employment during the mid-year school vacation. An estimated 116,600 residents were unemployed in June 2009. The seasonally adjusted figure was 91,800.

More Information

7.   Information on data sources and coverage as well as definitions of key concepts used in the report can be found in the attached Explanatory Notes. The preliminary data estimates are available online at the Ministry of Manpower’s website. A more detailed breakdown of the preliminary estimates will be released in the Economic Survey of Singapore, Second Quarter 2009.

8.   The above is a statistical release of the Manpower Research and Statistics Department of the Ministry.

Upcoming Publications

9.   The Ministry’s Manpower Research and Statistics Department will be releasing the full report on theLabour Market, Second Quarter 2009 on 15 September 2009.

Extract from http://www.mom.gov.sg/

URA real estate statistics stats(SG)

24 July 2009

Release of 2nd quarter 2009 real estate statistics

The Urban Redevelopment Authority (URA) released today the real estate statistics for the 2nd Quarter 2009.

SUMMARY

Prices of private residential, office, shop and industrial properties decreased by 4.7%, 3.9%, 1.4% and 4.5% respectively in the 2nd Quarter 2009.

Rentals of private residential, office, shop and industrial properties decreased by 5.2%, 7.7%, 2.0% and 5.6% respectively in the 2nd Quarter 2009.

The rates of decrease in the prices and rentals of private residential, office, shop and industrial properties have moderated in the 2nd Quarter 2009 as compared to 1st Quarter 2009.

As at 2nd Quarter 2009, there were 62,350 private residential units in the pipeline, comprising supply from projects that were already under construction and those that had been granted planning approval but were not under construction yet. For the office sector, there was a pipeline supply of about 1.24 million sq m Gross Floor Area (GFA) of office space from various Government and private land sources. Of these, about 38,112 private residential units and about 1.13 million sq m GFA of office space were expected to be completed between 3rd Quarter 2009 and 2012. This is based on developers’ declaration and actual completion schedule may change from quarter to quarter as developers adjust their development plans or construction schedule according to market conditions.

PRIVATE RESIDENTIAL PROPERTIES

Prices

Overall prices of private residential properties fell by 4.7% in 2nd Quarter 2009, compared with the decline of 14.1% in the previous quarter (see Annexes A-1, A-6& A-7).

Prices of non-landed properties fell by 4.7% in 2nd Quarter 2009, compared with the decline of 15.1% in the previous quarter. Prices of apartments fell by 4.9%, while prices of condominiums fell by 4.5%.

Prices of non-landed properties in Core Central Region1 (CCR) fell by 5.2% in 2nd Quarter 2009, and prices of non-landed properties in Rest of Central Region (RCR) and Outside Central Region2 (OCR) fell by 4.4% and 2.3% respectively (see AnnexA-2).

Prices of landed properties fell by 4.7% in 2nd Quarter 2009, compared with the decrease of 9.2% in the previous quarter. Prices of detached, semi-detached and terrace houses fell by 6.0%, 3.6% and 3.9% respectively in 2nd Quarter 2009.

The prices of private residential properties are not uniform and vary from project to project. Home-buyers can view the data on individual uncompleted private residential projects at the following url:http://www.ura.gov.sg/realEstateWeb/price.jsp. The database also provides information on projects with units still available for sale.

Besides the data on the sale of uncompleted units direct from developers, home-buyers can also access information on all private residential property transactions on URA’s website at the following url:http://www.ura.gov.sg/realEstateWeb/transaction.jsp. This database, which is based on caveats lodged with the Singapore Land Authority (SLA), contains comprehensive information on the prices and floor areas of the units.

Rentals

Rentals of private residential properties3 fell by 5.2% in 2nd Quarter 2009, compared with the decrease of 8.5% in the previous quarter (see Annex A-3).

Rentals of non-landed properties in CCR, RCR and OCR fell by 5.1%, 6.1% and 5.9% respectively in 2nd Quarter 2009 (see Annexes A-3 & A-4).

In addition, URA also released data on the 25th percentile, median and 75thpercentile rentals for individual private residential projects for 2nd Quarter 20094. The data on the rentals of individual private residential projects are available on URA’s website at the following url: http://www.ura.gov.sg/realEstateWeb/rental.jsp.

Supply in the Pipeline

As at the end of 2nd Quarter 2009, there was a total supply of 62,350 uncompleted units of private housing from projects in the pipeline5 (see Annex E-1). Of these, 38,482 units were still unsold. These comprised 2,594 units that had been launched for sale by developers and 12,534 units which had the pre-requisite conditions for sale and could be launched for sale immediately. The remaining 23,354 units with planning approvals did not have the pre-requisite conditions for sale6 (see Annex B-1). Details of the number of unsold private residential units with planning approvals in the 3 market segments are given in Annex B-2.

Of the 62,350 units, 38,112 units were expected to be completed between 3rd Quarter 2009 and 2012, of which 27,934 units were already under construction7. Developers had obtained planning approvals8 for projects making up the remaining 10,178 units (see Annex E-2).

URA also released detailed data on supply in the pipeline by market segment, development status and expected year of completion at the following url:http://www.ura.gov.sg/real_estate/pipeline_supply. This is to enable the public to have a more comprehensive picture of supply coming on-stream over the next few years in the private housing market. Of the 62,350 uncompleted units of private housing from projects in the pipeline, 22,767 units, 17,783 units and 21,800 units were in CCR, RCR and OCR respectively.

Launches and Take-up

A total of 3,869 uncompleted private residential units were launched for sale by developers in 2nd Quarter 2009, compared with 2,108 units in 1st Quarter 2009. Of the 3,869 uncompleted units launched in the quarter, 1,134 units were in CCR, 1,426 units were in RCR, and 1,309 units were in OCR (see Annex C-1). Major residential projects launched in the quarter included 8@Woodleigh at Woodleigh Close (330 units), Mi Casa at Choa Chu Kang Avenue 3 (283 units of a total of 457 units), Martin Place Residences at Kim Yam Road (252 units of a total of 302 units) and The Arte at Jalan Raja Udang (216 units of a total of 336 units).

In 2nd Quarter 2009, 4,521 uncompleted private residential units were sold by developers, compared with 2,552 units in 1st Quarter 2009. Of the 4,521 uncompleted units sold in the quarter, 1,386 units were in CCR, 1,815 units were in RCR, and 1,320 units were in OCR (see Annex C-2). Developers also sold 133 completed private residential units in 2nd Quarter 2009.

Sub-sales

The total number of sub-sales was 940 in 2nd Quarter 2009, compared to 412 sub-sales in the previous quarter. In percentage terms, sub-sales accounted for 10.9% of all sale transactions in 2nd Quarter 2009, compared to 9.9% in 1st Quarter 2009. The number of sub-sales in CCR in 2nd Quarter 2009 accounted for 17.4% of the property sale transactions in this area in the quarter, compared to 23.6% in the previous quarter. The percentage of sub-sales in 2nd Quarter 2009 for RCR, at 8.5%, was lower than the 12.9% in the previous quarter. However, the percentage of sub-sales in OCR in 2nd Quarter 2009 of 7.9% was higher than the 5.7% in the previous quarter (see Annex D).

Stock and Vacancy

A total of 2,928 private residential units were completed (granted TOP) in 2nd Quarter 2009. Major residential projects completed in the quarter were The Quartz at Compassvale Bow (625 units), Botannia at West Coast Park (493 units) and The Metropolitan Condominium at Alexandra View (382 units).

The vacancy rate of completed private residential units remained at 5.9% as at the end of 2nd Quarter 2009 (see Annex E-1).

Executive Condominiums

As at the end of 2nd Quarter 2009, there were no Executive Condominium (EC) units in the pipeline. All available EC units have been sold (see Annexes F-1 & F-2).

The total stock of completed EC units was 10,430 units as at the end of 2nd Quarter 2009. As at the end of 2nd Quarter 2009, the vacancy rate was 0.7%, compared with the vacancy rate of 0.8% as at the end of the previous quarter (see Annex E-1).

OFFICE SPACE

Rentals

The rentals for office space in Singapore fell in 2nd Quarter 2009. Overall rentals for office space, based on leases which had commenced, decreased by 7.7% in 2nd Quarter 2009, compared with the decrease of 10.7% in 1st Quarter 2009 (see Annex A-3).

The median rental for “Category 1”9 office space, based on leases which had commenced, was S$10.60 per square foot per month (psf pm) in 2nd Quarter 2009, lower than the median rental of S$11.56 psf pm in 1st Quarter 2009. In comparison, the median rental for “Category 2”10 office space was S$5.08 psf pm in 2nd Quarter 2009, lower than the median rental of S$5.49 psf pm in 1st Quarter 2009 (see Annex A-5). As “Category 2” office space accounts for about 80% of all office space in Singapore, the rental for such space is more reflective of the typical rental paid by office tenants in Singapore. These statistics were compiled based on IRAS’ records of rental contracts in Singapore where the leases had commenced in 2nd Quarter 2009.

The median rentals for “Category 1” and “Category 2” office space based on rental contracts signed in 2nd Quarter 2009 were S$10.59 and S$5.11 psf pm respectively (see Annex A-5). These statistics were compiled based on IRAS’ records of rental contracts which were signed in the reference quarter, regardless of whether or not the leases commenced in the reference quarter11.

Prices

Prices of office space decreased by 3.9% in 2nd Quarter 2009, compared with the 12.0% decrease in the previous quarter (see Annex A-1).

Supply in the Pipeline

As at the end of 2nd Quarter 2009, there was a total supply of about 1.24 million sq m GFA of office space in the pipeline. Of the total pipeline supply of office space, about 1.13 million sq m were expected to be completed between 3rd Quarter 2009 and 2012. More detailed data on pipeline supply of office space by development status and expected year of completion are at Annex E-1 and E-2.

Apart from office space, as at the end of 2nd Quarter 2009, there was a total supply of about 513,000 sq m of business park space from projects in the pipeline12from Government and private land sources which were expected to be completed between 3rd Quarter 2009 and 2012. Business Park space primarily caters to non-pollutive industries and businesses that engage in high-technology, research and development (R&D), high value-added and knowledge-intensive activities. However, some of the Business Park space could be used for selected office uses such as backroom operations of companies.

Stock and Vacancy

The amount of occupied office space decreased by 23,000 sq m (nett) in 2nd Quarter 2009, as compared with the 30,000 sq m decrease in the previous quarter. A total of 51,300 sq m of office space were completed (granted TOP) in 2nd Quarter 2009. This included the newly completed office development at Tampines Grande (25,800 sq m), completion of additions and alteration works to the existing office building at 60 Robinson Road (6,400 sq m) and EFG Bank Building at North Bridge Road (6,000 sq m).

The island-wide vacancy rate of office space was 10.8% as at the end of 2nd Quarter 2009, higher than the 10.0% as at the end of 1st Quarter 2009. Similarly, the vacancy rate for “Category 1” office space increased to 6.0% as at the end of 2nd Quarter 2009, from 5.3% as at the end of 1st Quarter 2009. The vacancy rate for “Category 2” office space as at the end of 2nd Quarter 2009 was 11.9%, compared to 11.0% as at the end of 1st Quarter 2009 (see Annex A-5).

SHOP SPACE

Rentals

The overall rentals for shop space in Singapore, based on leases which had commenced, decreased by 2.0% in 2nd Quarter 2009, compared with the 3.3% decrease in the 1st Quarter 2009 (see Annex A-3). The median rental for shop space in the Orchard Planning Area (Orchard), Rest of City Area (RCA)13 and Outside City Area (OCA) also decreased slightly to S$10.39, S$6.40 and S$5.45 psf pm respectively in 2nd Quarter 2009 (see Annex A-5). These statistics were compiled based on IRAS’ records of rental contracts in Singapore where the leases commenced in 2nd Quarter 2009.

The median rentals for shop space in Orchard, RCA and OCA based on all rental contracts signed in 2nd Quarter 2009, regardless of whether or not the leases commenced in the quarter, were S$10.30, S$6.61 and S$5.45 psf pm respectively (see Annex A-5).

Prices

Prices of shop space decreased by 1.4% in 2nd Quarter 2009, compared with the 4.2% decrease in the previous quarter (see Annex A-1).

Supply in the Pipeline

As at the end of 2nd Quarter 2009, there was a total supply of 560,000 sq m GFA of shop space from projects in the pipeline14, from Government and private land sources. Of the total pipeline supply of shop space, about 475,000 sq m were expected to be completed between 3rd Quarter 2009 and 2012. More detailed data on pipeline supply of shop space by development status and expected year of completion are at Annex E-1 and E-2.

Stock and Vacancy

The amount of occupied shop space increased by 23,000 sq m (nett) in 2nd Quarter 2009, compared with the 1,000 sq m increase in 1st Quarter 2009. A total of 59,500 sq m of shop space were completed (granted TOP) in the 2nd Quarter 2009. This included the newly completed ION Orchard at Orchard Turn (42,200 sq m) and Orchard Central at Orchard Road (14,800 sq m).

The islandwide vacancy rate of shop space was 7.5% as at the end of 2nd Quarter 2009, compared to the 6.6% vacancy rate as at the end of 1st Quarter 2009. The vacancy rates for shop space in Orchard, RCA and OCA as at the end of 2nd Quarter 2009 were 16.2%15, 7.8% and 5.6% respectively. In comparison, the vacancy rates for shop space in Orchard, RCA and OCA as at the end of 1st Quarter 2009 were 4.7%, 8.0% and 6.4% respectively (see Annex A-5).

INDUSTRIAL SPACE

Prices and Rentals

Prices of multiple-user factory space fell by 4.5% in 2nd Quarter 2009, compared with the 9.9% decrease in the previous quarter (see Annex A-1). Rentals of multiple-user factory space also fell by 4.2%, compared with the 6.1% decrease in the previous quarter (see Annex A-3).

Supply in the Pipeline

As at the end of 2nd Quarter 2009, there was a total supply of 3.19 million sq m GFA of factory space from projects in the pipeline16, from Government and private land sources. Of the total pipeline supply of factory space, about 3.02 million sq m were expected to be completed between 3rd Quarter 2009 and 2012. More detailed data on pipeline supply of factory space by development status and expected year of completion are at Annex E-1 and E-2.

Stock and Vacancy

The amount of occupied factory space increased by 139,000 sq m (nett) in 2nd Quarter 2009, higher than the increase of 40,000 sq m (nett) in 1st Quarter 2009. A total of 380,800 sq m of factory space were completed (granted TOP) in 2nd Quarter 2009.

The vacancy rate of factory space was 7.8% as at the end of 2nd Quarter 2009, higher than the vacancy rate of 7.0% as at the end of 1st Quarter 2009.

URA’s REAL ESTATE INFORMATION SERVICE

More detailed information on the price and rental indices, supply in the pipeline, stock and vacancy position of the various properties can be found in the Real Estate Information System (REALIS), an online database of URA.

Subscribers of REALIS can obtain the information from the system after 12.30 pm today. More information on REALIS can be found athttp://spring.ura.gov.sg/lad/ore/login/index.cfm. You can also contact the REALIS hotline at 6329 3456.

Extract from www.ura.gov.sg

Daily Market Analysis AMC—27/07/09

Sellers Shaken for Modest Gain

Dow +15.27 at 9108.51, Nasdaq +1.93 at 1967.89, S&P+2.92 at 982.18

[BRIEFING.COM] Thanks to underlying support in the broader market and leadership from bank stocks, the major indices were able to shake off a mild fit of profit taking and close modestly higher.

Stocks started the session with moderate losses as participants pushed back after watching stocks climb more than 10% during the course of the past two weeks. The major averages made a respectable move higher when news surfaced that new home sales during June spiked 11% to hit a better-than-expected annualized rate of 384,000. With new home sales coming in at their highest rate since November, the supply of unsold homes moved lower to 8.8 months from 10.2 months in May.

Enthusiasm over the new home sales report didn’t last very long, but a supportive bid for the broader market helped contain weakness. The stock market was also supported by strength among bank stocks, which underpinned a 1.5% gain by the financial sector.

Bank stocks showed strength for the entire session and helped the KBW Banking Index log a 3.1% gain. With many major banks having already reported their quarterly results, there weren’t any particular news items to account for the strength behind banking issues. However, news from The Wall Street Journal that second quarter lending was down nearly 3% among 15 large U.S. banks suggested that many banks remain cautious about putting their money to work. Reports indicate that lending also slowed in the euro-zone.

In-line earnings from Dow component Verizon (VZ 31.00, -0.50) and Honeywell (HON 34.24, +0.25) were underwhelming. Honeywell’s cautious outlook did little to inspire. Such was the same for Aetna (AET 25.72, -0.72), which also fell short of earnings expectations.

A prerecorded interview with Fed Chairman Bernanke will air on PBS tonight. According to Reuters, Bernanke responded to questions about the Fed’s actions during the past year by saying that he would not be the one who presided over the second Great Depression. Bernanke also stated that the jobless rate will remain high even after the U.S. exits recession.

AMGN Tops Estimates

Last Update: 27-Jul-09 16:52 ET

Price level versus 4 pm ET: Thanks to underlying support in the broader market and leadership from bank stocks, the major indices were able to shake off a mild fit of profit taking and close modestly higher.

Seven of the ten sectors posted a gain, led by financials (+1.5%), with banks showing particularly strength.

The worst performing sector was tech (-0.3%).

Futures are flat after hours, with S&P 500 futures, at 979.10 and Nasdaq 100 futures, at 1598.00 both in-line with fair value.

AMGN reports second quarter (Jun) earnings of $1.29 per share, $0.13 better than the First Call consensus of $1.16. Revenue fell 1.4% year-over-year to $3.71 billion versus the $3.58 billion consensus. second quarter Drug Sales: Enbrel: $899 million versus $901 million; Neulasta: $831 million versus $875 million First Call Consensus; Aranesp: $693 million versus $668 million First Call Consensus; Epogen: $638 million versus $605 million First Call Consensus; Neupogen: $327 million versus $322 million First Call Consensus. Company issues upside guidance for fiscal year 2008, sees earnings per share of $4.80-4.95 versus $4.57 consensus; says revenues for 2009 are trending towards the upper end of the current guidance range of $14.4-14.8 billion versus $14.33 billion consensus. “We are optimistic about our financial performance in 2009 and are focused on making denosumab a success,” said Kevin Sharer, chairman and chief executive officer.

A larger number of companies report earnings tomorrow before the open, including Office Depot (ODP),Supervalu (SVU), U.S. Steel (XC) and Viacom (VIA.B).

On the economic calendar, the S&P/Case-Shiller Home Price Index for May is due 9:00ET followed by July consumer confidence at 10:00ET.

The first of a three part speech by Fed Chairman Bernanke on PBS news Hour with Jim Lehrer is scheduled for 18:00ET.

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