PublicInvest Research

Author: PublicInvest   |   Latest post: Mon, 20 Jan 2020, 9:05 AM


PublicInvest Research Headlines - 13 Feb 2019

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US: Job openings jump to record 7.3m in Dec. US job openings surged to a record high in Dec, led by vacancies in the construction, accommodation and food services sectors, which could bolster views that the economy is experiencing a dearth of workers. Job openings increased 169,000 to a seasonally adjusted 7.3m. That was the highest level since the series started in 2000. The job openings rate climbed to 4.7% from 4.6% in Nov. Hiring rose to 5.9m from 5.8m in Nov. Anecdotal evidence has been growing of companies experiencing difficulties finding workers, a phenomenon that economists expect will slow down job growth this year. The government reported earlier this month that nonfarm payrolls increasing by 304,000 jobs in Jan, the largest gain since February 2018. (Reuters)

US: Red flags emerge as Americans' debt load hits another record. Some red flags emerged for the US economy late last year as credit card inquiries fell, student-loan delinquencies remained high and riskier borrowers drove home automobiles, according to a report that could signal a downturn is on the horizon. The US household debt and credit report, published by the Federal Reserve Bank of New York, showed that the overall debt shouldered by Americans edged up to a record USD13.5trn in the 4Q2018. It has risen consistently since 2013, when debt bottomed out after the last recession. While mortgage debt, by far the largest slice, slipped for the first time in two years, other forms of borrowing rose including that of credit cards, which at USD870bn matched its pre-crisis peak in 2008. (Reuters)

India: Inflation eases in Jan, industrial production growth tops forecast. India's consumer price inflation unexpectedly slowed in Jan, figures from the Central Statistics Office showed on Tuesday. The consumer price index rose 2.05% YoY following a 2.11% climb in Dec, which was revised from 2.19%. Economists had expected 2.54% inflation. In Jan 2018, inflation was 5.07%. Food inflation remained in negative territory in January, at -2.17% versus -2.65% in Dec. Separate data from the statistical office showed that industrial production rose 2.4% YoY in Dec, which was faster than the 1.5% gain economists had forecast. (RTT)

Singapore: Retail sales continue to fall in Dec. Singapore retail sales declined in Dec, primarily due to a sharp contraction in automobile sales, survey data from the Department of Statistics showed. Retail sales at current prices declined 6.0% YoY in Dec after a 2.4% fall in Nov. Automobile sales dropped 20.7% YoY after a 15.1% fall in the previous month. Excluding motor vehicles, retail sales declined 3.0% annually after rising 0.5% in the previous month. Computer and telecommunications equipment sales declined 16.8%, the same pace as in Dec. Among the few categories that registered gains, sales at medical goods and toiletries registered a rise of 1.8%. MoM, retail sales dropped 3.4% in Dec, in contrast to a 0.1% rise in Nov. (RTT)

Malaysia: Bank Negara records higher foreign reserves at Jan 31 . Bank Negara Malaysia's international reserves rose USD400m to USD102.1bn as at Jan 31, 2019 compared with USD101.70bn on Jan 15. Bank Negara said on Tuesday the reserves position of USD102.1bn was sufficient to finance 7.4 months of retained imports and was one time total short-term external debt. Jan 15's foreign reserves of USD101.70bn then was enough to finance 7.3 months of retained imports and was one time the short-term external debt. During the 15- day period, the ringgit had strengthened against the US dolllar from 4.0975 on Jan 15 to 4.0890 on Jan 31. (Starbiz)


Muhibbah: The RM585m contract terminated due to ‘commercial, operational issues’, Bintulu Port Authority says. The termination of the RM584.8m contract awarded to Muhibbah Engineering (M) was due to “commercial and operational issues”. It said it has gotten a clarification from Bintulu Port Authority that the contract termination was attributable to the authority’s “commercial and operational issues”. Meanwhile, Muhibbah said its 51%-owned unit Muhibbah Viccana JV and Bintulu Port Authority are in discussion on the compensation related to the termination of the contract. (The Edge)

Kerjaya Prospek: Bags RM280m contract to build main building for Subang Jaya project. Kerjaya Prospek Group has won an RM280m contract from HCK Capital Group to build the main building for a development project in Subang Jaya. It said its wholly-owned unit Kerjaya Prospek (M) SB has accepted the letter of award from HCK Capital’s subsidiary, HCK Builders SB. The 28-month contract is targeted to be completed by July 2021. (The Edge)

Econpile: Bags RM209m contract, exceeds FY18's total new wins. Econpile Holdings has bagged a RM209.3m contract to undertake basement and substructure works for Phase 2 of the Pavilion Damansara Heights mixed development in Jalan Damanlela here. This new contract brings Econpile’s total new wins to RM506.7m in the current YTD, which is higher than the RM473.4m recorded in the FY18. Its orderbook current stands at RM1.1bn, which will provide earnings visibility till FY21. (The Edge)

Velesto Energy: Bags USD38m contract extension for North Malay Basin. Velesto Energy (formerly known as UMW Oil & Gas Corp) has bagged a USD38m contract extension to provide high pressure high temperature (HPHT) jack-up drilling rig and services for North Malay Basin, Malaysia. It said its wholly-owned subsidiary Velesto Drilling SB has received the extension from Hess Exploration and Production Malaysia BV. Velesto said it will assign one of its rigs, NAGA 8, for this 18-month contract extension, which also comes with an option for further extension. (The Edge)

Atrium REIT: Announces put and call option and cash calls related to Penang land deal. Atrium REIT has entered into a put and call option agreement in relation to an RM180m land deal announced last Nov. It said the agreement was entered into with the vendor of the land, Lumileds Malaysia SB, a wholly-owned subsidiary of Lumileds International BV. It provides for the option to enter into a sale and purchase agreement and leaseback of two pieces of land in Penang, coupled with the factory and all buildings erected on the site, for RM50m. (The Edge)

Frontken: FY18 net profit jumps to RM52m. Engineering services company Frontken Corp posted a stronger set of financial results for the FY18 underpinned by better global semiconductor business and improvement in oil and gas business in Malaysia and Singapore. Its net profit rose by 75% to RM52.2m from RM29.8m in FY17 while its revenue increased by 10.3% to RM327.2m from RM296.6m. The higher revenue was mainly due to better performances from the group’s subsidiaries in Singapore, Malaysia and Taiwan. (StarBiz)

Supermax: 2Q profit climbs on higher revenue. Supermax Corp's net profit for the 2QFY19, rose to RM38.1m from RM35.9m recorded in the same period a year ago. Revenue increased 14.6% YoY to RM385.1m from RM335.9m previously, following the commissioning of new replacement lines at its Perak plant and full-quarter contribution from plants 10 and 11, the group said. (StarBiz)

Market Update

The FBM KLCI might open higher today after US stocks ended the day higher on optimism over a tentative deal to avert another government shutdown and encouraging signs that the US and China will advance trade talks this week. The S&P 500 rose 1.3%, while the Dow Jones Industrial Average and the technology-heavy Nasdaq both advanced 1.5%. Investors dismissed comments from President Donald Trump that he was “not happy” with a deal etched out by Democrats and Republicans on Monday night that would keep the government open and avoid a shutdown on Friday. The arrangement would provide less than a quarter of the USD5.7bn Mr Trump is seeking to build a wall along the Mexican border. In Europe, the Stoxx 600 index inched up 0.9%, with the index tracking car and car parts makers adding 3.21%. Frankfurt’s Xetra Dax 30 added 1.45%, with London’s FTSE 100 up 0.35%.

Back home, the FBM KLCI index lost 1.15 points or 0.07% to 1,687.41 points on Tuesday. Trading volume increased to 2.70bn worth RM1.96bn. Market breadth was positive with 425 gainers as compared to 406 losers. Hong Kong’s Hang Seng steadied 0.1% higher after an early dip, while in China the CSI 300 index of Shanghai- and Shenzhen-listed stocks climbed 1%, recovering from an intraday slip. Tokyo’s Topix gained 1.41%, with industrials and other exporters encouraged by a weaker currency.

Source: PublicInvest Research - 13 Feb 2019

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