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PublicInvest Research

Author: PublicInvest   |   Latest post: Fri, 27 Nov 2020, 10:57 AM

 

PublicInvest Research Daily - 27 October 2020

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Economy

  • US: New home sales drop, record low mortgage rates underpinning demand. Sales of new US single-family homes unexpectedly fell in Sept after four straight monthly increases, but the housing market remains supported by record low mortgage rates and demand for more space as the COVID-19 pandemic drags on. New home sales fell 3.5% to a seasonally adjusted annual rate of 959,000 units last month. (Reuters)
  • US: Container lines expect US import binge to lose steam. Surging shipments into the US are fueling record high freight costs and logjams at seaports, but transportation executives say the rally will lose steam with a second wave of COVID-19 restrictions on the cards. Container shipping companies, which move goods for customers got stung late last year and early this year when COVID19 halted trade around the world, and they question whether the US import boom can be sustained. (Reuters)
  • EU: German government raises 2020 GDP forecast to -5.5%. The German government will revise upwards its forecast for GDP for 2020 when it presents an update to its estimates this week, a source familiar with the government’s forecast told. The government now expects GDP to shrink 5.5% in 2020 compared to a previous estimate for a 5.8% decline. This means the recession triggered by the coronavirus pandemic will be slightly milder than the loss of output caused by the global financial crisis in 2009 when GDP fell by a record 5.7%. (Reuters)
  • EU: German Ifo business morale weakens for first time in 6 months. German business sentiment weakened in Oct as leaders were more worried about coming months amid the rising coronavirus infection numbers, survey data from the Munich-based ifo Institute showed. The business climate index fell to 92.7 in Oct from revised 93.2 in Sept. This was the first fall in six months. The reading was forecast to drop to 93.0 from Sept's initially estimated 93.4. (RTT)
  • UK: Consumer confidence falls after five months of gains. A measure of consumer confidence among people in Britain fell for the first time in six months in Oct as worries mounted about new COVID-19 restrictions , polling firm YouGov and the Centre for Economics and Business Research said. Concerns about household finances and property values pushed down the index to 101.3, down 1.1 points from Sept. (Reuters)
  • South Korea: GDP grows 1.9% on quarter in Q3. South Korea’s economy returned to growth in the 3Q, climbing out of the slump brought about by the coronavirus as its major trading partners began lifting pandemic restrictions. Asia’s fourth-largest economy GDP gained a seasonally adjusted 1.9% on quarter in the 3Q of 2020, the fastest expansion since the first quarter of 2010, the Bank of Korea said in advance estimate. (RTT)
  • Singapore: Industrial production rises sharply in Sept. Singapore industrial production grew sharply in Sept, data from the Economic Development Board showed. Industrial output grew 24.2% yearly in Sept, following a 15.4% rise in Aug. Economists had forecast an annual growth of 2.5%. Excluding biomedical manufacturing, output rose 8.5% annually in Sept, after a 16.4% increase in the previous month. (RTT)

Markets

  • GDB: Bags RM1.25bn Conlay contract. GDB Holdings has secured its single largest contract of RM1.25bn to complete the remaining main building works for 8 Conlay, an upscale integrated mixed development in Jalan Conlay. The contract win brings GDB's total outstanding order book to RM2.27bn, which will recognised till FYE Dec 31 2023. (Business Times)
  • Glomac: Cuts 40% of property launches, remains optimistic of steady earnings. Glomac is slashing about 40% of its property launches this year but remains optimistic of steady earnings visibility. Group MD and CEO Datuk Seri FD Iskandar said the optimisim was on the back of higher sales, especially from July-Sept this year, backed by increasing demand in the landed segment. He said Glomac's financial performance would be sustainable, backed by unbilled sales of RM660m as at the 1Q of FY2021 (Business Times)
  • JF Tech: Unit proposes collaboration with Huawei’s Hubble Technology Investmnent. JF Technology’s wholly owned subsidiary JF International SB has entered into a proposed business collaboration with Huawei Investment & Holding Co Ltd’s wholly owned subsidiary Hubble Technology Investment Co Ltd (HTI). The collaboration is formalised with a capital increase and shareholders agreement via JFH Technology (Kunshan) Co Ltd, a wholly owned subsidiary of JF International. Following the capital subscription, JF possessing a 55% equity stake and HTI holding the remaining 45% stake. (SunBiz)
  • Pharmaniaga: Signs MoU on pneumococcal vaccine with India’s Serum Institute. Pharmaniaga’s wholly owned subsidiary Pharmaniaga Lifescience SB (PLS) has entered into a MoU with Serum Institute of India Pvt Ltd for the purchase of pneumococcal vaccine and is subsequently to be manufactured by PLS. “The MoU and collaboration contemplated therein will serve as a platform for the company to further strengthen its vaccine business.” (SunBiz)
  • Kanger: Ropes in more collaborators to help distribute Covid-19 vaccines. Kanger International has roped in Zuellig Pharma SB and K-Star Sport Ltd to collaborate on the distribution of Covid-19 vaccines in Malaysia. The vaccine and other products are developed by state-owned China National Pharmaceutical Group Corp (Sinopharm). The collaboration agreement is valid until Sept 24, 2023. (The Edge)
  • Cabnet: Lands RM17m electrical package job in Kedah. Cabnet Holdings’ unit Cabnet Systems (M) SB has been appointed as a subcontractor by Kinetics Systems Malaysia SB (KSM) for a job valued at RM17.1m. The subcontract, which commenced on Oct 21, is scheduled to be completed on Aug 15, 2021. (The Edge)
  • Logistics: No new courier licences until Sept 15 2022, says MCMC. The Malaysian Communications and Multimedia Commission (MCMC) has frozen the issuance of new courier licences for two years from Sept 14 this year until Sept 15, 2022. MCMC said this was to allow the government and the postal and courier players to make new plans to strengthen the sector which faces various challenges due to technological changes and market trends. (Business Times)

MARKET UPDATE

  • The FBM might open lower today after US stocks on Monday notched their biggest one-day drop in a month on fears that rising coronavirus infections will dampen business activity and as another session passed without a deal for pre-election fiscal stimulus. The S&P 500 fell as much as 2.9% in afternoon trading, as the latest infection data undercut hopes of the virus being contained. However, the benchmark index trimmed its losses to end 1.9% lower — its biggest one-day loss since September 23 — as Nancy Pelosi, Democratic speaker of the House of Representatives, expressed optimism on a stimulus deal. The selloff was broad, with economically sensitive sectors such as energy, financials and industrial groups under pressure. Travel and leisure companies sustained heavy selling. It followed a gloomy day in Europe, in which Frankfurt’s benchmark Dax index slumped 3.7%. The broader Stoxx 600 was down 1.8 %.

    Back home, the FBM KLCI index ended almost flat at 1,494.61. Across Bursa Malaysia today, 677 counters demonstrated declines, 301 counters were up, while 491 counters finished the trading day unchanged. Regional shares were largely in the red. The Nikkei 225 was down by 0.09% or 22.25 points at 23,494.34, while the Shanghai Composite finished 0.82% or 26.88 points lower at 3,251.22. In contrast, the Hong Kong Hang Seng Seng index was up by 0.54% or 132.65 points at 24,918.78.

Source: PublicInvest Research - 27 Oct 2020

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