POTENTIAL dual listings provided the main targets for yesterday's session, following Tuesday's explosive debut for China XLX in Hong Kong (HK). As a result, stocks such as Oceanus, China New Town, China Milk and Midas were all in play, based on hopes that if they obtain approval to list in markets such as HK or Taiwan, where valuations are higher, their prices here will have to rise.

However, if HK is the market of choice for a second listing, brokers warned against over-speculation because of the onerous paperwork and procedures. All told, it is estimated that at least 15 working days, or about three weeks, would be needed to effect any transfer, by which time any price differential could be eroded.

The Straits Times Index, in the meantime, hovered around the 2,800 mark thanks mainly to support for the banks, which came despite steep falls in overseas markets, leading to the suggestion that the index was possibly being window-dressed. However, the index did lose 8.29 points to 2,797.21 by the close following a 1.4 per cent loss in HK and a soft opening Europe-wide that pointed to a weak Wednesday for Wall Street.

In its latest Asean Bank report this week, Nomura said that early-2009 investor predictions of massive credit losses and recapitalisation among Singapore banks have been binned, as robust quarterly results and low non-performing loans boost earnings optimism.

'Declining provisioning and recovering fee income appear to be discounted by the recent rally - positive (or negative) surprise on net interest income, that is (loan growth, margin) and/or acquisitions will likely be required for the next move,' said Nomura.

'We think DBS has the right beta credentials (capital market, interest rate proxy) but OCBC is our pick for better-quality fundamentals and strategic, fee-based franchise building.'

Meanwhile, Neptune Orient Lines (NOL) recently released its period 11 operating numbers (Oct 17 - Nov 13) which has prompted brokers to issue fresh recommendations on its shares.

CIMB's Dec 8 call was to maintain its 'trading sell'. 'While volume continued to improve year-on-year because of the low-base effect, the average rate continued to hover at the very depressed level of US$2.239/FEU (forty-foot equivalent unit), 28.3 per cent lower year-on-year,' said CIMB.

The broker said that it expects the average rate to remain low until May/June next year and said that its target price of $1.60 was based on 1.1x price/book which is roughly the midpoint of the historic trading band, excluding 2007's peak.

Morgan Stanley, in the meantime, maintained an 'equal weight' rating with a $1.50 target price for NOL. 'NOL's current valuation of 1.1x 2010 estimated price/book, above its historical average, is not particularly compelling,' said MS. 'We expect weak freight rates over the next three months to weigh on NOL's near-term stock performance.'

MS, however, added that it expects fortunes to improve next year when rates rise in mid-2010. NOL yesterday lost one cent to $1.53.

In a Tuesday chart view, Phillip Securities said that the odds in the equity market now are stacked in favour of the bears.

' The S&P 500 continues to show a divergence and the dollar has spiked . . . there is also a divergence present in the STI. We continue to maintain the view that we will see weakness in the STI in the short term and advise investors to stay out of longs,' said Phillip.