Economy

US: Manufacturing sector edges up in Aug – ISM. US manufacturing activity unexpectedly picked up in Aug amid strong order growth, but a measure of factory employment dropped to a nine month low, likely as workers remained scarce. The Institute for Supply Management (ISM) said its index of national factory activity inched up to 59.9 last month from a reading of 59.5 in July. Manufacturing is holding up even as spending is rotating back to services from goods because of vaccinations against COVID-19. (Reuters)

US: Private payrolls miss expectations in Aug - ADP. US private employers hired far fewer workers than expected in Aug, but the labor market continues to steadily recover. Private payrolls increased by 374,000 jobs last month, the ADP National Employment Report showed. Data for July was revised slightly down to show 326,000 jobs added instead of the initially reported 330,000.. (Reuters)

EU: Euro zone Aug factory growth strong - as were price rises, PMI shows. Euro zone manufacturing growth remained strong in Aug but supply chain issues caused by the coronavirus pandemic continued to constrain supplies of the raw materials factories need, driving up prices. The easing of restrictions imposed to stop the coronavirus from spreading has driven demand. (Reuters)

EU: Eurozone jobless rate falls in July. The euro area unemployment rate declined in July as economies reopened from the second wave, figures published by Eurostat showed. The unemployment rate fell to 7.6% in July, as expected, from 7.8% in June. In the same period last year, the jobless rate was 8.4%. The number of people out of work decreased 350,000 in July from June. On a yearly basis, unemployment fell by 1.336m. (RTT)

UK: House prices bounce back unexpectedly in Aug. British house prices rebounded surprisingly strongly in Aug, chalking up their second-biggest monthly rise in 15 years after a fall the month before when a pandemic-era tax break began to be phased out. Mortgage lender Nationwide Building Society said British house prices rose by 2.1% MoM in Aug after a 0.6% fall in July, well above economists' forecasts in a Reuters poll for a modest 0.2% increase. (Reuters)

China: Manufacturing sector shrinks slightly in Aug. China's manufacturing sector contracted slightly in Aug, driven by a renewed drop in output and a further fall in new work, survey results from IHS Markit showed. The Caixin factory Purchasing Managers' Index fell to 49.2 in Aug from 50.3 in July. A score below 50 indicates contraction in the sector. It was the first time that business conditions had worsened since April 2020, with the index dipping to its lowest level for a year-and-a-half. (RTT)

India: Manufacturing growth eases in Aug. India's manufacturing sector grew at a softer pace in Aug in the backdrop of a second wave of coronavirus infections and surging costs, survey results from IHS Markit showed. The headline manufacturing PMI, fell to 52.3 in Aug from 55.3 in July. Economists had forecast a score of 55. Any reading above 50 indicates expansion in the sector. (RTT)

Indonesia: Inflation at 3-month high. Indonesia's consumer prices increased to the highest in three months in Aug, data from the statistics bureau showed. Consumer prices rose 1.59% YoY in Aug, following a 1.52% increase in July. Economists had expected a 1.6% rise. The latest inflation was the highest since May, when it was 1.68%. Core inflation was 1.31% in July, which was above the 1.30% economists had forecast. (RTT)

Markets

SCIB: Bags RM80m contract to build specialist hospital in Johor. Sarawak Consolidated Industries (SCIB) has bagged an RM80m contract from Kencana Healthcare SB to supply medical equipment for a specialist hospital in Johor. SCIB said it had on Sept 1 accepted a letter of award for procurement, supply, installation, testing and commissioning of medical equipment for proposed development of specialist hospital. The company said the contract was for a minimum 10 years and should be mutually extended for another five years from the date of full completion of the project. (Business Times)

Paramount: Buys land in Sepang for RM103m . Paramount Corp is buying 13.25 hectares of freehold residential land in Sepang, Selangor for RM102.7m cash. The company has projected GDV of RM319.8m to be generated from this new development over a period of six years. "The proposed acquisition is in line with Paramount's strategy of replenishing its land bank at locations with strong growth potential and to scale up its property development activities to generate long-term sustainable income," it said. (StarBiz)

Solarvest: Bags RM175m contract to build largest solar farm in Perlis . Solarvest Holdings unit Atlantic Blue SB has secured a RM175m contract to build a solar photovoltaic (PV) energy generating facility in Chuping, Perlis. Solarvest said its unit had been appointed the engineering, procurement, construction and commissioning (EPCC) contractor for the development of the 50MW solar PV facility and received the project from Classic Solar Farm SB. (The Edge)

Pekat: Lands RM18m contract to build solar PV system for IWK sewerage plants . Pekat Group has secured a contract worth RM18.1m to build solar photovoltaic power plants at 16 sewerage treatment plants owned by Indah Water Konsortium SB. The firm said its unit Pekat Solar SB (PSSB) had accepted the letter of award by MFP Solar SB for the project. MFP Solar is a 55:45 JV between Mega First C&I Solar SB, a unit of Mega First Corporation, and Pekat's unit Pekat Teknologi SB. The project, which is slated to commence this month, is expected to be completed in March 2022. (The Edge)

Prestar: Extends partnership with Japan's Murata Machinery to expand global footprint. Prestar Resources is extending its collaboration with Murata Machinery Ltd (Japan) for the supply of automated storage and retrieval system (ASRS) racking systems. According to Prestar, it recently entered into a supplemental manufacturing partnership agreement with Murata's logistic and automation division to include additional nine subsidiaries of Murata from various regions and countries, namely the US, China Europe, India, Thailand, Singapore, Vietnam, Taiwan and Hong Kong in the manufacturing partnership agreement. (The Edge)

UEM Edgenta: Aims for 12% annual revenue growth in next five years . UEM Edgenta is aiming for an annual revenue growth of 12% for the next five years driven by its healthcare segment, overseas expansion, and digitalisation. Its managing director chief executive officer, Syahrunizam Samsudin said the group's plans to move away from a concession-based business model into commercial businesses remained intact. (StarBiz)

Market Update

US markets were mixed overnight as investors digested disappointing employment data in which private payrolls only gained by 374,000 in August versus an expectation of 600,000. While the tech-heavy Nasdaq Composite managed to eke out another record close with a 0.3% gain, the 30-stock Dow Jones Industrial Average slipped 0.1%. The S&P ended the day largely unchanged. European markets were mostly higher however as investors shrugged off concerns about higher inflation and rate hike fears. Germany’s retail sales slipped more than expected in July, weighing slightly on the benchmark DAX which slipped 0.7%. Elsewhere, France’s CAC 40 and Spain’s IBEX 35 outperformed with gains of 1.2% and 1.6% respectively, the latter seeing acceleration in its manufacturing PMI reading. UKs FTSE 100 inched 0.4% higher. Most Asian markets were also higher despite a private survey showing Chinese factory activity slowing in August. The Shanghai Composite and Hang Seng indices gained 0.7% and 0.6%. Japan’s Nikkei 225 rose 1.3%.

The FBM KLCI finally took a breather from last week’s 100-point rebound, slipping 0.9% on the day.

Source: PublicInvest Research - 2 Sept 2021