CIMB rates Singapore financial stocks at Overweight; says OCBC (O39.SG) booked best-quality 3Q earnings, showing all-round strength, DBS (D05.SG), UOB (U11.SG) beat expectations but results trading-inspired. SGX (S68.SG) in line, considering slow volumes at quarter-start, according to Dow Jones.

“Margin pressure remained a dominant, negative theme for the banks. Although the rates of contraction slowed on quarter, the trend may not reverse anytime soon,” says CIMB whose top pick is DBS top pick; top shorts are OCBC and SGX.

“While we continue to like OCBC’s revenue engines, DBS is being transformed...(CEO) Piyush Gupta’s re-positioning of the DBS franchise is starting to show results,” says CIMB. Research house rates OCBC at Neutral with $11.04 target, DBS at Outperform, $17.00 target, UOB at Outperform, target $20.83.

Rates SGX at Trading Sell, target $8.26; while it could be proxy for stock-market liquidity, negative rating premised on arbitrage pricing from ASX (ASX.AU) deal, dragging on SGX stock.

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