US: Business activity cools further in July - IHS Markit survey. US business activity grew at a moderate pace for a second straight month in July amid supply constraints, suggesting a cooling in economic activity after what was expected to have been a robust 2Q. Data firm IHS Markit said its flash US Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to a fourmonth low of 59.7 from 63.7 in June. Businesses are battling shortages of raw materials and labor, which are fanning inflation, in the aftermath of the economy's reopening after severe disruptions caused by the COVID-19 pandemic. (Reuters)
US: Business borrowing for equipment rises 17% in June - ELFA. Borrowings by US companies for capital investments rose about 17% in June from a year earlier, the Equipment Leasing and Finance Association (ELFA) said. The companies signed up for USD10.4bn in new loans, leases and lines of credit last month, up from USD8.9bn a year earlier. Borrowings rose 28% from the previous month. Despite slower-than-desired vaccinations in certain parts of the US, consumer spending is accelerating, markets remain strong and unemployment continues to slowly abate, all of which are contributing to a strong economy. (Reuters)
EU: Businesses boomed in July but confidence weakened. Eurozone business activity expanded at its fastest monthly pace in over two decades in July as the loosening of more COVID-19 restrictions gave a boost to services but fears of another wave of infections hit business confidence. With vaccination rates accelerating and the burden on health care easing governments have lifted some of the curbs they imposed to try and contain the virus' spread, unleashing pent-up demand. IHS Markit's Flash Composite Purchasing Managers' Index climbed to 60.6 in July from 59.5, its highest reading since July 2000. (Reuters)
EU: PMI shows recovery on track, Delta creates risk. The composite PMI survey for the euro area suggests the economy is on track for the recovery to strengthen in 3Q, as Bloomberg Economics and the ECB forecast. That’s being helped by increasing momentum in the services sector. However, even as vaccination becomes more widespread, activity remains vulnerable to a resurgence of Covid-19 cases, highlighting the risk created by the spread of the Delta variant. The headline PMI rose to 60.6 in July from 59.5 in June, signaling the economy is expanding for the fifth consecutive month. The outcome was slightly better than the median estimate of economists surveyed by Bloomberg News of 60.0. (Bloomberg)
EU: German private sector logs record growth in July. Germany's private sector logged a record growth in July driven by an ongoing rapid recovery in services activity, flash survey results from IHS Markit showed. The composite output index rose to 62.5 in July from 60.1 in June. The latest score was the highest since January 1998 and above economists' forecast of 60.8. The services Purchasing Managers' Index advanced to a record 62.2 from 57.5 in the previous month. The score was expected to rise moderately to 59.1. The manufacturing PMI came in at a three -month high of 65.6, up from 65.1 a month ago and economists' forecast of 64.2. (RTT)
UK: Growth slows sharply in July as COVID 'pingdemic' hits. Britain's rapid economic bounce-back from the coronavirus pandemic slowed sharply in July as a new wave of cases forced hundreds of thousands of workers to self-isolate under government rules to limit the spread of the disease. Supermarkets and hauliers say staff shortages are making it hard to restock shelves and deliver goods, and monthly purchasing managers' index (PMI) data gave the first clear evidence of the scale of the impact. The IHS Markit/CIPS flash composite PMI dropped to 57.7 in July from 62.2 in June. (Reuters)
UK: Retailers return to growth. British retail sales resumed their post-lockdown recovery in June after a surprise fall in May, as soccer fans watching the Euro 2020 tournament loaded up on food and drink to enjoy at home. Retail sales volumes rose by 0.5% in June from May, the Office for National Statistics said, slightly stronger than a 0.4% increase expected by economists polled. Sales were up by 9.5% compared with their pre-coronavirus pandemic February 2020 levels. Food stores, which suffered the biggest hit in spending in May as consumers returned to restaurants and bars, drove the increase in June with volumes rising by 4.2%. (Reuters)
UK: Consumer sentiment improves in July - GfK. UK consumer sentiment strengthened more-than-expected in July to reach ahead of its March 2020 pre-lockdown level, survey data from the market research group GfK showed. The consumer sentiment index rose to - 7 in July from -9 in the previous month. The expected reading was -8. This means it has now held firm or improved for six months in a row. Among components of the consumer sentiment index, two measures were up in comparison to June, two measures were down and one stayed the same in July. (RTT)
Taiwan: Industrial production rises in June. Taiwan's industrial production increased in June driven by robust manufacturing activity, data from the Ministry of Economic Affairs showed. Industrial output grew 18.37% YoY in June, following a 16.88% increase May. The annual growth in manufacturing output advanced to 20.20% from 17.69% in the previous month. Meanwhile, mining and quarrying declined 5.11% and electricity, gas and water supply output fell 0.29%. Water supply output was down 4.39%. On a MoM basis, industrial production gained 2.57% in June, following a 2.54% rise in the prior month. (RTT)
Singapore: Inflation remain steady at 2.4%. Singapore's consumer prices remained stable in June, data from the Monetary Authority of Singapore and the Ministry of Trade and Industry showed. The consumer price index rose 2.4% YoY in June, same as seen in May. Economists had expected a 2.5% rise. This latest consumer prices outcome was largely due to a rise in prices for private transportation and accommodation cost. MAS core CPI, which excludes costs of accommodation and private road transport, increased 0.6% annually in June, after a 0.8% increase in the preceding month. (RTT)
Pertama Digital: Raises stake in govtech software Dapat Vista to 80%. Pertama Digital is raising its stake in govtech software company, Dapat Vista (M) SB, by exercising its contractual option to buy an additional 24% equity in the software company. It will be acquiring the stake from HeiTech Padu. Upon completion of the transaction, Pertama Digital's stake in Dapat will increase to 80%, while HeiTech holds 20%. The group is executing its rights now to strategically take advantage of the global flight to digitalisation. (The Edge)
Seni Jaya: Proposes one-for-two bonus issue of warrants. Seni Jaya has announced a proposal to undertake the bonus issue of warrants on the basis of one bonus warrant for every two existing ordinary shares.nThe exercise entails the issuance of up to 24.32m warrants under the maximum scenario, which assumes the completion of the private placement prior to the entitlement date of the warrants. The entitlement date will be determined and announced later. (The Edge)
Pharmaniaga: To start Sinovac Covid-19 vaccine sale to private sector, states next month. Pharmaniaga will start selling Sinovac Covid-19 vaccine in the open market from next month as it has fulfilled its commitment to the government, group MD Datuk Zulkarnain Md Eusope said. Zulkarnain also clarified that the total of 14m doses of Sinovac vaccine for sale to interested states and private companies was to speed up the vaccination process nationwide. He said after the NPRA approval, Phamrmaniaga's "fill and finish" programme had reached 4m doses a month compared to 2m doses previously. "Hence, from June to September we will have a surplus of 14m doses from the fill and finish programme. (NST)
Hong Seng: Ventures into Covid-19 antibody testing kits distribution. Hong Seng Consolidated says it is venturing into distributing Covid-19 antibody testing kits. The company announced that it was buying a 51% stake in Covid-19 antibody testing distributor RZAC Immunesafe SB for RM40.3m. The announcement came after news of Hong Seng, via a 51%-owned subsidiary, securing a RM112m one-year contract to supply Covid-19 test kits to the Health Ministry. (NST)
BAT Malaysia: 2Q net profit rises 31% to RM71.62m, pays 24sen dividend. British American Tobacco’s net profit for 2QFY21 rose 31.14% to RM71.62m, driven by domestic volume growth. The group’s quarterly revenue increased by 9% YoY to RM595.8m. The group attributed the better performance partly to the implementation of Budget 2021 measures, such as tobacco transhipment restrictions to control the tobacco black market. The group has declared an interim dividend of 24 sen.
NTPM: Deferred tax income helps stop NTPM falling into losses in 4QFY21. The deferred tax income of RM7.84m helped lift NTPM's net profit to RM5.6m in 4QFY21, from RM4.08m a year ago. Quarterly revenue, however, dropped 6.5% YoY to RM188.53m, no thanks to the decrease in sales of tissue paper products. In FY22, the board foresees new challenges to the group from the significant rebound in prices of many key inputs. It said active management of the sourcing of raw materials and the supply chain to optimise input cost is a critical management focus. (The Edge)
The FBM KLCI might open higher today after US stocks ended Friday at a new high, reversing steep losses at the start of the week, as fears about the Delta variant of corona virus were soothed by strong corporate earnings and continued central bank support for financial markets. The S&P 500 climbed 1%, lifting the index’s weekly gain to 2% and its advance for the year above 17%. The technology-focused Nasdaq Composite rose just over 1%, giving the index its strongest weekly advance since April. The Stoxx Europe 600 index, which had its worst session of the year on Monday with a 2.3% drop, gained 1.1% on Friday and was up 1.5% for the week. The dominance of the highly transmissible Delta virus variant has helped to stir fears that global economic growth could slow. Such concerns, however, have been overshadowed by upbeat guidance from much of corporate America and expectations that central banks stand at the ready to intervene if growth cools.
Back home, the FBM KLCI closed lower last Friday as investors stayed cautious amid rising number of Covid-19 cases. The benchmark index ended 4.18 points or 0.27% lower at 1,523.44, after trading between 1,523.16 and 1,529.65. Most regional bourses also finished lower as virus worries linger. South Korea’s Kospi index ended 0.13% higher at 3,254.42, Hong Kong’s Hang Seng closed 1.45% lower at 27,321.98, and the Shanghai Composite index finished 0.68% lower at 3,550.4.
Source: PublicInvest Research - 26 Jul 2021
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Created by PublicInvest | Mar 21, 2024