PublicInvest Research

Author: PublicInvest   |   Latest post: Wed, 20 Jan 2021, 11:39 AM


PublicInvest Research Headlines - 21 Jul 2020

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EU: Belgium consumer confidence weakens slightly. Belgium's consumer confidence weakened slightly in July after recovering strongly in the previous month, survey data from the National Bank of Belgium showed on Monday. The consumer confidence index dropped to -20 from -19 in June. In May, the reading was -23. The indicator is still very low, at a level 16 points lower than it was before the health crisis, the survey found. The vulnerability of households is growing as they dip more and more into their savings to cover their everyday expenditure, the bank said. Consumers turned more pessimistic regarding the future general economic situation and remained extremely worried about the labor market outlook. (RTT)

EU: Edges toward massive stimulus package with new proposal. European Union leaders were given a new compromise proposal for a EUR750bn (USD858bn) recovery fund to help the bloc overcome the economic fallout from the coronavirus pandemic. European Council President Charles Michel distributed the latest plan on Monday, which would include EUR390bn of grants, down from an initial USD500bn, and EUR360bn of low-interest loans, according to a copy of the proposal seen by Bloomberg. (Bloomberg)

UK: Consumer gloom eases but job worries widespread - IHS Markit. British households’ view of their financial situation improved modestly in July to just above its long-run average, after hitting an eight-and-a-half year low in April due to the coronavirus, a survey showed on Monday. IHS Markit said its monthly Household Finance Index rose to 41.5 in July from 40.7 in June, though it is below its level in March before the economy went into lockdown to slow the spread of Covid-19. However, unemployment is forecast to increase dramatically later this year when a temporary government scheme that has support more than 9m jobs ends in Oct. (Reuters)

UK: Home asking prices jump on tax break to fight virus slump. Home sellers across Britain are optimistic again after the government temporarily cut a tax on property, according to the website Rightmove. Advertised prices climbed 3.7% from a year earlier in July, the most in more than three years, Rightmove said on Monday. Values were 2.4% higher than when the lockdown started in March. Stamp duty, a levy on home sales, was suspended on July 9 for about 90% of transactions, saving most buyers thousands of pounds. (Bloomberg)

China: Leaves benchmark lending rates unchanged. China's central bank left its key interest rates unchanged for the third consecutive month as the economy showed signs of recovery from the unprecedented slump caused by the coronavirus pandemic. The one-year loan prime rate was retained at 3.85% and the five-year loan prime rate was maintained at 4.65%. The bank was expected to retain its rates Monday as the medium lending facility rate was kept unchanged at 2.95% earlier this month. (RTT)

Hong Kong: April-June unemployment rises to 6.2%, highest in over 15 years. Hong Kong’s seasonally adjusted unemployment rate rose to 6.2% in the April-to-June period, the highest in more than 15 years, as the coronavirus outbreak restricted activity in an economy already in recession. The jobless rate rose from 5.9% in the March to May period, the government said on Monday. The underemployment rate hit 3.7%, the highest in close to 17 years, from 3.5% in the previous three-month rolling period. (Reuters)


Supermax: Proposes 1-for-1 bonus issue. Supermax Corp has proposed a bonus share issue of one share for every existing share, involving up to 1.36bn new shares. The bonus issue is expected to double the number of issued shares to 2.72bn. (The Edge)

TA Enterprise: Group's properties have to be revalued due to delay in implementing takeover offer. TA Enterprise (TAE) said due to a delay in implementing its takeover offer for an additional stake in its 60.17%-owned unit TA Global, the circular in relation to the offer and the proposed subscription to shareholders of TAE is now scheduled to be released in mid November due to the need for a revaluation on material properties held by the TA Group. Consequently, TAE said the extraordinary general meeting to seek approval from the non interested shareholders of TAE in relation to the offer is now expected to be held at the end of November. (The Edge)

Widad: Widad founder, Muhammad Ikmal raises stake to 71.99%. Widad Group's founder and group executive chairman, Tan Sri Muhammad Ikmal Opat Abdullah, has further increased his shareholding in the group to 71.99% after acquiring a 7.58% stake via several open market and off-market transactions recently. (Bernama)

Versatile Creative: Responding to UMA query, Versatile Creative says it is exploring new business opportunities . Versatile Creative, whose share price closed at a near two-year high in active trading, said it is in the process of exploring a new business arrangement. "Versatile Creative has been continuously on the lookout for opportunities to expand its core business and/or diversify its current businesses to enhance the earnings and improve its financial performance," the group said in a filing with Bursa Malaysia. Versatile Creative said apart from that, it is not aware of any reason in relation to the group's business and affairs that may account for the trading activity. (The Edge)

Kenanga: Terminates MoU with Petronas in vendor IPO project . Kenanga Investment Bank has terminated a MoU with Petroliam Nasional (Petronas) aimed at helping oil and gas contractor list their shares on Bursa Malaysia, citing the lack of development. "Since the signing of the MOU on Feb 18, 2020, due to the COVID-19 pandemic and the recent fluctuation in the oil prices, there is minimal development on the progress of the MoU," the investment bank said in a filing. "Therefore, the company wishes to announce that in accordance with Clause 5 of the MOU, a 30-day notice of termination has been issued by Kenanga IB to Petronas." The MoU would cease to be effective from Aug 19. (The Star)

Rubber Gloves (Neutral): Imposing windfall tax on glove companies will curb expansion — MARGMA . Any move to impose a windfall tax on glove companies given their supernormal earnings due to the Covid-19 pandemic would only curb their expansion programme, said MARGMA vice president Dr Supramaniam Shanmugam. Supramaniam highlighted that a 24% corporate tax is already imposed on companies, which means government revenue from the said tax also increased alongside with the bumper earnings seen now. (The Edge)

Market Update

  • The FBM KLIC might open higher today as major US stock indices closed higher Monday, with the Nasdaq scoring a record close and its best daily gain in nearly 12 weeks, as investors looked forward to quarterly results from corporations over the coming days. Investors also focused on positive developments from coronavirus vaccine candidates and talks in Washington on fresh stimulus. The Dow Jones Industrial Average added 8.92 points, or less than 0.1%, to finish at 26,680.87, ending two sessions of declines. The S&P 500 rose 27.11 points, or 0.8%, to end at 3,251.84. The Nasdaq Composite surged 263.90 points, or 2.5%, to end at a record 10,767.09, booking its largest daily percent gain since April 29. The Stoxx 600 Europe index finished up 0.8%, while the U.K.’s FTS fell 0.5%.

    Back home, the FBM KLCI closed lower, dampened mostly by weak interest in banking and telecommunication index-linked counters. At 5pm, the benchmark index settled 6.88 points or 0.43% lower at 1,589.45, from 1,596.33 last Friday. Across Asia, Japan's Nikkei 225 edged up 0.09%, while South Korea's Kospi fell 0.14%. In China, the Hong Kong Hang Seng Index inched down 0.12% while the Shanghai Stock Exchange Composite Index rose 3.11%.

Source: PublicInvest Research - 21 Jul 2020

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