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STOCKS NEWS SINGAPORE-Index flat; brokers favour oil and gas stocks

Singapore shares were little changed, with several brokerssaying they continue to favour oil and gas stocks such as EzionHoldings Ltd as oil prices are expected to remainfavourable for exploration and production activities.

The Straits Times Index was up 0.1 percent at3,079.72 points. The MSCI index of Asia-Pacific shares outsideJapan added 0.6 percent.

DBS Vickers said the Singapore market is cheap on dividendyield and price-to-book ratio compared with the rest of theregion, but its earnings and return on equity outlook are lessattractive.

Yield compression and a slower second half in 2012 arelikely reasons to take profit, DBS said. But it noted that themarket will continue to be supported by strong yield plays.

Its picks are oil and gas stocks such as Sembcorp Marine Ltd, ASL Marine Holdings Ltd , STX OSV HoldingsLtd and Ezion.

Ezion shares rose as much as 1.9 percent on Tuesday afterDBS, DMG & Partners Securities and OCBC Investment Research allsaid they liked the stock. DMG said it expects Ezion to announcerecord quarterly core net profit for its third quarter.

Ezion's stock has more than doubled this year versus the30.5 percent gain in the FT ST Oil and Gax Index .

1241 (0441 GMT)

(Reporting by Eveline Danubrata in Singapore;eveline.danubrata@thomsonreuters.com; Editing by PrateekChatterjee)

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10:45 STOCKS NEWS SINGAPORE-DMG sees strong gains in small,midcap oil and gas stocks

DMG & Partners Securities said it believes small and mid-capoil and gas stocks could continue to outperform the big-caps asinvestors seek to rotate into smaller cap plays with attractivevaluations.

DMG said it likes companies with strong growth profile,track record in delivering profits and management withsubstantial stake in the company.

The broker's top picks are Ezion Holdings Ltd , NamCheong Ltd and Technics Oil and Gas Ltd ,which it said are trading at a discount of 25-50 percent to the2013 fiscal year price-earnings valuations for big-caps.

DMG advised investors to avoid Chinese shipyards with heavyexposure to commercial shipbuilding due to excess capacity,pressure on margins for new orders and deteriorating earningsvisibility.

1117 (0317 GMT)

(Reporting by Eveline Danubrata in Singapore; Editing byG.Ram Mohan; eveline.danubrata@thomsonreuters.com)

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10:45 STOCKS NEWS SINGAPORE-OCBC raises target on FrasersCommercial Trust

OCBC Investment Research raised its target price on FrasersCommercial Trust to S$1.31 from S$1.23 and maintainedits 'buy' rating, citing the company's possible debt reduction,an expected rise in income and attractive valuation.

Frasers units were up 0.4 percent at S$1.16 on Tuesday. Theunits have increased 58 percent so far this year versus the 27percent gain in the FT ST Midcap Index .

With the recent sale of its KeyPoint property to BayfrontVentures Pte Ltd for S$360 million ($292.7 million), Frasers islikely to sit on net proceeds of S$357.8 million and book in again of S$72.8 million, OCBC said.

OCBC noted that Frasers is likely to use the bulk of thesale proceeds to redeem half of its series A convertibleperpetual preferred units and reduce its existing debt.

Frasers is also expected to gain from interest savings as aresult of the early refinancing of its S$500 million term loanfacility at favourable borrowing margins, OCBC said.

It added that Frasers' acquisition of the balance 50 percentinterest in Caroline Chisholm Centre and direct tenant leases atChina Square Central are likely to contribute positively to thecompany's rental income.

OCBC said the stock was trading at an "attractive"price-to-book ratio of 0.87 times.

1037 (0237 GMT) (Reporting by Eveline Danubrata in Singapore;eveline.danubrata@thomsonreuters.com)($1 = 1.2301 Singapore dollars)

Keywords: MARKETS SINGAPORE STOCKSNEWS/MIDDAY