Diminishing contraction. Our page-count monitor of The Straits Times indicates further improvement in advertising spending in July with a smaller yoy contraction of 10% from -16% in June (May: -14%, April: -16%, March: - 22%). Anecdotal evidence points to a rise in property ads given the current residential property boom with new project launches practically every week. Developers are also re-marketing old projects which are not yet fully sold. The property boom is also generating higher activities in the secondary property market, thus leading to more classified ads Rising job ads point to greater business confidence. The total number of recruitment ad pages has also improved from 230 in March to 279 in July.
Singapore’s unemployment rate remains comfortable. The seasonallyadjusted unemployment rate for 2Q09 has remained unchanged at 3.3%, the same as in 1Q09. Resident unemployment even declined to 4.6% in 2Q09, from 4.8% in 1Q09. This could be due to the government’s Jobs Credit scheme cushioning job losses and the hiring of 13,000 to fill civil service jobs since the start of this year.
The worst is over. While SPH is usually a late-cycle recovery play, we believe advertising revenue (AR) growth will stage an early comeback this time round, with advertising spending recovery aided by the opening of Singapore’s two mega integrated resorts- Marina Bay Sands and Resorts
World@Sentosa in end-09/1Q10.
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