Economy

US: Weekly jobless claims fall to 16-month low. The number of Americans filing new claims for unemployment benefits fell to a 16- month low last week as the labour market steadily gains traction, but worker shortages are frustrating efforts by businesses to ramp up hiring to meet strong demand for goods and services. (Reuters)

US: Fed's Powell says he's undecided on central bank digital currency. Fed Chair Jerome Powell said he had not made up his own mind on the merits or demerits of a central bank digital currency, but he would want authorization from Congress before taking any action to create one. (Reuters)

US: Manufacturing output dips as chip shortage weighs on motor vehicles. Output at US factories unexpectedly fell in June as motor vehicle production dropped amid an unrelenting global semiconductor shortage. Manufacturing output dipped 0.1% last month after accelerating 0.9% in May, the Fed said. Economists polled by Reuters had forecast manufacturing output climbing 0.2% in June. (Reuters)

US: Import prices rise solidly in June. US import prices increased solidly in June as bottlenecks in the global supply chain persisted, the latest indication that inflation could remain elevated for a while amid strong domestic demand fueled by the economy's reopening and fiscal stimulus. Still, prices appeared to have peaked. Import prices rose 1.0% last month after surging a 1.4% in May, the Labour Department said. (Reuters)

UK: Lenders to increase availability of unsecured credit in 3Q: BoE survey. The UK lenders plan to increase the availability of unsecured credit to households in the 3Q, the Credit Conditions Survey from the BoE showed. Banks said the availability of unsecured credit already rose in the three months to May and is set to rise further over three months to end-Aug. (RTT)

UK: Employment & vacancies increase sharply. UK employment increased significantly in June as the relaxation of many coronovirus restrictions helped employers to expand their operation, data from the Office for National Statistics showed. Payroll employment increased sharply by 356,000 to 28.9m in June. However, it remained 206,000 below pre-coronavirus pandemic levels. (RTT)

China: Economy grows slower than expected in 2Q. China's economic growth likely slowed in the 2Q, as higher raw material costs hurt factories and new COVID-19 outbreaks weighed on consumer spending, a Reuters poll showed, suggesting policymakers may do more to support growth. GDP likely increased 8.1% YoY in the AprilJune quarter, according to the median forecasts of 51 economists polled by Reuters. (Reuters)

Indonesia: Trade surplus increases in June. Indonesia's trade surplus increased in June, figures from Statistics Indonesia showed. The trade surplus increased to USD1.32bn in June from USD1.27bn a year ago. Economists had expected a surplus of USD2.23bn. In May, the trade surplus was USD2.70bn. Exports grew 54.46% YoY in June. Economists had expected a rise of 49.9%. Imports rose 60.12% annually in June. (RTT)

Markets

Ireka: Secures RM124m construction job in Terengganu. Ireka Corp has secured a construction project in Terengganu worth RM124.39m. The group said the contract from Wanland Metro SB involves the construction of two blocks of 16-storey apartment, single storey terrace houses, double storey terrace houses and double storey shophouses at Dendong in Besut district. (The Edge)

Solarvest: Bags RM87.5m EPCC contract in Kedah. Solarvest has clinched a RM87.5m contract from Energy ES SB. Solarvest said the contract involved the main engineering, procurement, construction and commissioning (EPCC) works for a 20.76MW large scale solar photovoltaic (LSSPV) plant in Kulim, Kedah. Group CEO Davis Chong Chun Shiong said Solarvest was expanding its exposure in the national LSS programme to unlock more green energy to serve the local communities. (NST)

Kelington: Bags RM50m storage tank contract from Stolhaven. Kelington Group has secured a new contract from Stolthaven (Westport) SB worth RM50m. It said it would be undertaking the engineering, procurement, and construction works for the oil products storage tanks for Tank Pit 8 expansion project in Port Klang, Selangor. Kelington said it had so far this year secured about RM195m of new orders, lifting its outstanding orderbook to RM454m as at July. (NST)

KAB: To raise RM106m via private placement for renewable energy projects and debt repayments. Kejuruteraan Asastera (KAB) plans to raise RM106.13m via a private placement for its renewable energy business and the repayment of bank borrowings. (The Edge)

Berjaya Corp: Plans hospitality REIT – Abdul Jalil. Berjaya Corp is eyeing to establish a hospitality REIT in the long run, which focuses only on five-star hotels owned by the group instead of those it operates, said group CEO Abdul Jalil Abdul Rasheed. The operating model of the group’s hospitality division is now gradually shifting to owner model rather than an operator model. The group’s hospitality division is slowly exiting markets like China and Vietnam and shifting its focus on five-star business in places like Japan. (StarBiz)

Scomi: JV with RC Asia to collectively bid for tenders in rail industry. Scomi Group has entered into a JV agreement with RC Asia Engineering SB to collectively bid for tenders for construction of railway stations, tracks or other related railway infrastructures in the rail industry. Scomi would own 51% equity interest in JV Co while RC Asia Engineering would hold the remaining 49%. (Bernama)

IPO: Coraza Integrated Technology seeks ACE market listing. Sheet metal fabrication firm Coraza Integrated Technology has filed a draft prospectus for an IPO on the ACE market. The proposed IPO will involve 139.21m shares, comprising 117.79m new shares and an offer for sale of up to 21.42m existing shares. The group plans to use the IPO proceeds to build a new factory with an estimated construction cost of RM14.28m. (The Edge)

MARKET UPDATE

The FBM KLCI might end the week lower after US government debt rallied and big US and European stock markets slid on Thursday as slowing growth in China and the rapid spread of the Delta variant of coronavirus fuelled fears about the health of the global economy. Wall Street followed European bourses lower, with the blue-chip S&P 500 and tech-heavy Nasdaq Composite down 0.3% and 0.7% respectively, after both hit highs earlier this week. Bourses were in the red across Europe, where Frankfurt’s Xetra Dax, the CAC 40 in Paris and the continent-wide Stoxx 600 benchmarks all closed 1% lower. London’s FTSE 100 shed 1.1%. China’s gross domestic product rose 7.9% in the second quarter compared with the same period last year, following an 18.3% gain in the first quarter. UK manufacturers have reported that rising Delta variant cases are hitting production while economists suspect rising infections in Europe risk derailing the eurozone’s recovery.

Back home, the FBM KLCI gained 8.5 points, or 0.56%, to close at 1,520.82. Elsewhere in the region, Hong Kong’s Hang Seng was 0.75% or 208.81 points higher at 29,996.27. The Shanghai Composite climbed 1.02% or 36.09 points to 3,654.59. However, the Nikkei 225 lost 1.15% or 329.4 points at 28,729.09, while the Straits Times Index across the causeway was 0.48% or 15.08 points lower at 3,138.07.

Source: PublicInvest Research - 16 Jul 2021