PublicInvest Research

PublicInvest Research Headlines - 27 Dec 2021

PublicInvest
Publish date: Mon, 27 Dec 2021, 09:46 AM
An official blog in I3investor to publish research reports provided by PublicInvest Research team.

All materials published here are prepared by Public Investment Bank Berhad. For latest offers on Public Invest trading products and news, please refer to: https://www.publicinvestbank.com.my/pbswecos/default.asp

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Economy

Global: World economy now set to surpass USD100trn in 2022. The world economy is set to surpass USD100trn for the first time in 2022, two years earlier than previously forecast, according to the Centre for Economics and Business Research. Global GDP will be lifted by the continued recovery from the pandemic, although if inflation persists it may be hard for policy makers to avoid tipping their economies back into recession. The forecast is in line with estimates of the International Monetary Fund, which also predicts global GDP measured in dollars and in current prices will pass USD100trn in 2022. (Bloomberg)

US: Holiday retail sales rise 8.5% as online shopping booms. US retail sales rose 8.5% during this year’s holiday shopping season from Nov 1 to Dec 24, a report by Mastercard Inc, powered by a rush to stores amid supply chain concerns as COVID-19 cases surge as well as soaring ecommerce sales. US e-commerce sales jumped 11% in this year’s holiday shopping season, yet again underscoring the COVID-19 pandemic’s role in transforming customers’ shopping habits. Holiday e-commerce sales made up 20.9% of total retail sales this year, the data showed. (Reuters)

UK: Businesses report weakest growth since last lockdown. British businesses have reported their weakest growth since the country was under lockdown earlier this year and they expect a further slowdown in early 2022, the Confederation of British Industry (CBI) said. The CBI’s monthly growth indicator – which combines surveys of output from manufacturers, retailers and other services companies fell 11 points to +21 in the three months to December, the lowest since the three months to April. Growth was expected to slow again in the coming three months as the Omicron variant of the coronavirus weighs on the economy. Substantial challenges remain for businesses heading into Christmas, labour and materials shortages, rising costs and new COVID measures are restricting businesses’ ability to trade during this crucial period. (Reuters)

Japan: Inflation jumps 0.6% on year in Nov. Overall nationwide consumer prices in Japan were up 0.6% on year in Nov, the Ministry of Internal Affairs and Communications, beating forecasts for 0.4% and up from 0.1% in Oct. Core CPI, which excludes volatile food prices, climbed an annual 0.5% also exceeding expectations for 0.4% and up from 0.1% in the previous month. Individually, prices were higher for food, housing, fuel, furniture, clothing and recreation; they were lower for medical care, transportation and communication. On a seasonally adjusted monthly basis, overall inflation and core CPI both rose 0.3%. (RTT)

Japan: Housing starts rise at slowest pace in 8 months. Japan's housing starts grew at the slowest pace in eight months in Nov, data from the Ministry of Land, Infrastructure, Transport and Tourism showed. Housing starts increased 3.7% on a yearly basis in November, slower than the 10.4% expansion seen in October. This was the weakest growth since March, when housing starts gained 1.5%. Economists had forecast an annual growth of 7.1% for November. Annualized housing starts fell to seasonally adjusted 848,000 in November from 892,000 in the previous month. (RTT)

Japan: Sticks with budget balance goal despite record spending. Japan is sticking for now with its goal to balance its budget by the end of March 2026 even after approving record spending for next year. “As we’ve written in this year’s government plans, we are still looking to reach a primary balance in the fiscal year 2025,” said Finance Minister Shunichi Suzuki, shortly after the Cabinet approved a record initial budget of JPY107.6trn (RM4trn) for the year starting in April. Economists see the goal of balancing the primary budget by the end of March 2026 as unrealistic. The primary balance excludes debt servicing costs. Still, the latest budget does offer encouraging signs that Japan is moving out of crisis mode and may be able to review efforts to start reining in the developed world’s biggest debt load over the coming years. (Bloomberg)

Singapore: Manufacturing output growth moderates in Nov. Singapore's manufacturing output logged a double-digit growth in Nov but the pace of expansion eased, data from the Economic Development Board showed. Manufacturing output rose 14.6% YoY in Nov, following a 17% rise in Oct. This was the second consecutive expansion and exceeded economists' forecast of +13.4%. Excluding biomedical, manufacturing output growth improved to 12.4% from 9.7% a month ago. MoM, manufacturing output gained 2.3% versus 2.4% in Oct. All clusters of manufacturing reported growth from the previous year. Transport engineering logged the biggest annual Skip to content. (RTT)

Markets

Pacific & Orient: Sells its 22% stake in Singapore-based data software firm. Pacific & Orient is disposing of its 21.91% stake in Singapore-based data software company HiringBoss Holdings (HHPL) for USD19.83m (RM83.11m). HHPL is involved in provision of data-driven software for both corporate human resource and recruitment agencies. (The Edge)

Global Oriental: Teams up with Japan’s Sojitz to set up first Tsutaya Books outlet in Malaysia. Property outfit Global Oriental is forming a joint venture with Japan’s Sojitz Corp to establish the first Tsutaya Books outlet in Malaysia, at the Pavilion Bukit Jalil. Tsutaya Books is Japan’s largest bookstore and rental chain distributing books, music, DVDs and games, with 1,200 stores in Japan and nine in Taiwan and China. (The Edge)

Cuscapi: Plans private placement to raise RM22m for business expansion, working capital. Cuscapi has proposed a private placement of 10% of its issued shares to raise up to RM22.34m for its business expansion and working capital. The restaurant management and business management solutions provider plans to place out 85.93m new shares to third party investors, at an indicative price of 26sen apiece. (The Edge)

Malton: In talks to sell Pavilion Bukit Jalil Mall to Pavilion REIT. Malton is in talks to sell Pavilion Bukit Jalil Mall here to Pavilion REIT. Pavilion Bukit Jalil Mall is located within the 50- acre Bukit Jalil City, a development under Malton. (The Edge)

Carimin Petroleum: Scraps plan to raise RM30m via private placement. Offshore oil and gas service provider Carimin Petroleum has aborted plans to raise RM29.94m in a private placement of new shares. On May 27 this year, it proposed to undertake a private placement of up to 46.78m new shares, or 20% of the total existing issued shares, under which it would raise total gross proceeds of RM29.94m based on the indicative issue price of 64sen per placement share. (The Edge)

CTOS: Buys Juris Tech stake for over RM205m, its largest acquisition. CTOS Digital is acquiring a 49% stake in fintech specialist Juris Technologies for RM205.8m cash. This was its largest ever acquisition since its inception The company had entered into a conditional share sale and purchase agreement to buy the 49.0% stake from Natsoft (M). (BTimes)

Iris: Private placement exercise done. Iris Corp has completed its private placement exercise of 296.62m new shares. The final tranche of 74m placement shares, representing approximately 2.27% of the enlarged share capital, was subscribed by an insurance fund, AIA Bhd. The group has raised a total of RM71.16m under the private placement exercise, where the proceeds will be utilised for working capital requirements (StarBiz)

T7 Global: Gearing poised to drop next year. T7 Global hopes to see its gearing drop following the commissioning of its Bayan Mobile Offshore Production Unit (Mopu) project. The project will be the main revenue driver for the group in the foreseeable future and the drop in gearing would be supported by the rental cashflow it will receive once the Bayan Mopu project is commissioned. (StarBiz)

Market Update

The US markets were closed for holiday while European markets ended the day in mixed territory after a thin trading session on Christmas Eve, as traders kept a watchful eye on the latest developments around the Omicron Covid variant. London’s FTSE 100 ended the day up 0.2%, while the French CAC finished 0.3% lower. Markets in Germany, Italy and Switzerland were closed to mark the Christmas holiday. According to the South Africa research, which is not peer-reviewed, people infected with Omicron are 80% less likely to be admitted to hospital compared with other variants. However, the authors said this may be due in part to higher immunity in the population, while South African health officials cautioned that the data should not be extrapolated to all countries. In Asia, markets were mixed on Friday. Some major markets in the region, including Hong Kong and Singapore, close early for Christmas Eve.

Back home, the FBM KLCI was flat to close at 1,516.45. In terms of market news, CTOS Digital Bhd has proposed to buy a 49% stake in fintech specialist Juris Technologies Sdn Bhd for RM205.8m cash, the group's largest-ever acquisition since its inception. Property developer Malton Bhd is in talks to sell the Pavilion Bukit Jalil mall to Pavilion Real Estate Investment Trust (REIT).

Source: PublicInvest Research - 27 Dec 2021

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