Starhub (CC3.SG) flat at $2.33 on broad market retreat, prospect of higher competitive pressure in 2H10 given expected launch of Singapore’s high-speed national broadband network later this year, says Dow Jones.

But pullback accompanied by thin volume, suggesting telco’s $0.05/share quarterly dividend helping to mitigate concerns. Management remains committed to paying annual dividend of $0.20/share, which offers 8.6% yield based on yesterday’s close.

“We continue to believe the company’s strong free cash flow should support its dividends,” says Deutsche Bank, which has Buy call with $2.62 target.

Support expected at 50-day moving average, last at $2.28. 2Q10 net profit down 25.4% on year at $58.1 million on higher operating expenses.