US: Producer prices accelerate amid broadening inflation pressures. US producer prices increased by the most in eight months in Jan amid a surge in the cost of hospital outpatient care and goods such as food and motor vehicles, another sign that high inflation could persist through much of this year. The producer price index for final demand jumped 1.0% last month, the biggest advance since May, after climbing 0.4% in Dec. The PPI was boosted by a 0.7% increase in services, matching the gain in Dec. Services were driven by a 1.6% rise in the cost of hospital outpatient care. (Reuters)
US: New York manufacturing index rebounds less than expected in Feb. The Federal Reserve Bank of New York released a report showing a modest increase in activity in the month of Feb. The general business conditions index rose to a positive 3.1 in Feb from a negative 0.7 in Jan. While a positive reading indicates growth in regional manufacturing activity, however, economists had expected the index to show a more significant rebound to a positive 12.2. The modest rebound by the headline index partly reflected a turnaround by new orders, with the new orders index climbing to a positive 1.4 in Feb from a negative 5.0 in Jan. (RTT)
EU: Trade gap widens sharply on higher imports. The euro area trade deficit widened in Dec as exports declined amid a rise in imports, data from Eurostat showed. The trade shortfall rose sharply to EUR9.7bn in Dec from EUR1.8bn in Nov. The balance posted deficit for the second consecutive month. MoM, exports decreased 0.6%, while imports grew 3.1% in Dec. On an unadjusted basis, the trade balance showed a deficit of EUR4.6bn compared to surplus of EUR28.3bn in the same period of last year. Compared to last year, exports advanced 14.1%. (RTT)
EU: German ZEW economic confidence strengthens in Feb. German economic confidence strengthened in Feb despite rising economic and political uncertainties, survey results from the ZEW - Leibniz Centre for European Economic Research showed. The ZEW Indicator of Economic Sentiment climbed 2.6 points to a seven-month high of 54.3 points in Feb from 51.7 in Jan. However, this was below the economists' forecast of 55.0. The assessment of the economic situation also improved in the current survey period. The corresponding indicator rose 2.1 points to -8.1 points. (RTT)
UK: Labor market strengthens in Jan. The UK payroll employment and job vacancies rose to record highs and redundancies were below pre-pandemic levels, signaling the strength of the labor market despite the disruptions caused by the Omicron variant. Payrolled employees logged a monthly increase of 108,000 in Jan to a record 29.5m, the Office for National Statistics said. The number of job vacancies in Nov to Jan rose to a new record of 1,298,400. However, the rate of growth in vacancies continued to slow down. In Jan, the number of people claiming unemployment benefits decreased by 31,900 from the previous month. (RTT)
China: Keeps lending rate unchanged. China's central bank left its medium-term lending facility rate unchanged as it gauges the impact of the previous reduction. The People's Bank of China retained its one-year medium term lending facility rate at 2.85%. The bank had reduced the rates on lending facilities by 10bp in Jan. In Jan, the one-year loan prime rate was reduced by 5bp to 3.70%, which was the second consecutive reduction and the five-year LPR was lowered for the first time since April 2020, to 4.60%. As the PBoC had vowed to further increase financial support to the real economy in its monetary policy report, more easing still looks to be on the horizon. (RTT)
Japan: Economy rebounds on solid spending, Omicron clouds outlook. Japan’s economy rebounded in the final three months of 2021 as falling coronavirus cases helped prop up consumption, though rising raw material costs and a spike in new Omicron variant infections cloud the outlook. The world’s third-largest economy expanded an annualised 5.4% in Oct – Dec after contracting a revised 2.7% in the previous quarter, falling short of a median market forecast for a 5.8% gain. Economic growth was driven largely by a 2.7% QoQ rise in private consumption, which accounts for more than half of Japan’s GDP. (Reuters)
Japan: Manufacturers' mood sinks to 11-month low in Feb. Japanese manufacturers’ business confidence fell to an 11-month low in Feb as measures to contain the pandemic and high raw material costs hurt sentiment, the Reuters Tankan poll showed. Manufacturers were less optimistic about the three months ahead than they were in January, while service-sector firms’ outlook held up. The Reuters Tankan sentiment index for manufacturers fell to 6 in Feb from 17 in Jan, hitting its lowest since last March. The service-sector index slipped for the first time in five months, to 3 from the prior month’s 8. (Reuters)
Japan: Industrial production rises as estimated. Japan's industrial production rose in Dec, as initially estimated, final data from the Ministry of Economy, Trade and Industry said. Industrial production rose a seasonally adjusted 1.0% monthly in Dec, as estimated. Shipments rose 0.1% monthly in Dec. In the initial estimate, shipments fell 0.1%. Inventories increased 0.1% versus a 0.5% growth in the initial estimate. The inventory ratio fell 0.5% in Dec. In the initial estimate, the inventory ratio rose 0.1%. On a yearly basis, industrial production rose 2.7% in Dec, as initially estimated. Capacity utilization decreased 0.4% monthly in December and grew 4.2% from a year ago. (RTT)
Indonesia: Trade surplus falls in Jan. Indonesia's trade surplus in Jan decreased from a year ago, figures from Statistics Indonesia showed. The trade surplus fell to USD0.932bn in Jan from USD1.963bn a year ago. Economists had expected a surplus of USD0.19bn. In Dec, the trade surplus was USD1.007bn. Exports grew 25.31% YoY in Jan. Economists had expected a rise of 33.86%. Imports rose 36.77% annually in Jan. Economists had forecast an increase of 51.38%. On a monthly basis, exports decreased 14.29% and imports fell 14.62% in January. (RTT)
TNB (Outperform, TP: RM12.42): IRB files appeal against TNB on RM1.81bn additional tax claim. Tenaga Nasional Bhd (TNB) said on Feb 15 that it has been notified by the Inland Revenue Board (IRB) of the latter's notice of appeal to the Court of Appeal (CoA) on Feb 14 over the RM1.81bn tax claim for the year of assessment 2018 against the utilities group. TNB said that the appellate court has fixed March 28 for case management. (The Edge)
Capital A (Neutral, TP: RM0.79): To raise over RM400m for engineering arm. Capital A is raising more than RM400m in capital for its engineering arm, Asia Digital Engineering (ADE), which plans to build maintenance, repair and overhaul facilities at the Kuala Lumpur International Airport. The 380,000 sqft facility will commence in mid-2022 and is expected to be completed within two years. (The Edge)
MSM Malaysia: MSM Malaysia, Wilmar Sugar collaborate to build a sustainable sugar supply chain. MSM Malaysia Holdings (MSM Malaysia) and Wilmar Sugar Pte Ltd (Wilmar Sugar) inked a collaboration agreement in Dec 2021 to build a sustainable sugar supply chain. MSM Malaysia and Wilmar Sugar will embark on joint efforts to assist and support each other to pilot an approach to enable sustainable raw sugar sourcing within both company's joint supply chains by focusing on traceability reporting of sugar supplies and monitoring of sustainability performance based on the NDPE Sugar Policy. (BTimes)
UEM Sunrise: Issues RM50m sukuk. UEM Sunrise has made its inaugural issuances of Islamic Commercial Papers (ICPs) and Islamic Medium Term Notes (IMTNs), with a nominal value of RM10m and RM40m respectively. The group said the new ICPs have a tenure of nine months and will mature on Nov 15, 2022, while the new IMTNs have a tenure of three years and will mature on Feb 14, 2025. (The Edge)
Aeon Malaysia: Implements RM1,500 minimum wage hike, from RM1,200 earlier than recommended. Aeon Co (M) has announced the implementation of minimum wage hike for its Grade G employees from RM1,200 to RM1,500 per month effective from Jan 1. The company said the amount was the basic salary which did not include allowances or other incentives. Accordingly, the effective date of the new minimum wage by Aeon Malaysia is earlier than the date recommended by the government, which is by the end of 2022. (BTimes)
Sunway: Unveils corporate suite at flagship hotel. Sunway has unveiled Corporate Suite@19 office space, which is part of the USD60m transformation of the group's flagship five-star hotel Sunway Resort. The corporate suite, Sunway said, was a breathtaking top floor office space that would set a new benchmark for work space in Malaysia. Scheduled to open in the first quarter of 2022, the open-plan Grade A office is located on the highest level of Sunway Resort. (BTimes)
Asia Media: Collaborates with private firm to tap into out-of home market segment of advertising. Asia Media will collaborate with Setia Media SB to carry out the PJ Smart Gateway Project as part of plans to expand the group's digital advertising services into the out-of-home (OOH) market segment. (The Edge)
The FBM KLCI might open higher today as US and European shares rallied on Tuesday, while oil prices fell, after Russia said it had begun pulling some troops back to their bases, easing concerns that an attack against Ukraine was imminent. The S&P 500 index advanced 1.6% following a statement from Russia’s defence ministry, which said units from the country’s southern and western military districts were returning to base after the completion of drills. The Nasdaq Composite index, which has heavy weightings of technology stocks that are sensitive to swings in market sentiment, rose 2.5%. The Stoxx Europe 600 share index, which fell nearly 2% on Monday, closed 1.4% higher on Tuesday, while the FTSE 100 rose by a little over 1%. Germany’s Dax index gained 2%. Russia is estimated to have maintained a force of more than 100,000 troops near Ukraine in recent weeks. But on Tuesday afternoon, President Vladimir Putin said Russia was ready to hold “dialogue” with the west on core security issues. Nato had earlier said there were no signs of de-escalation, but also reason for cautious optimism that Russia would continue with diplomacy.
Back home, Bursa Malaysia closed at its intraday high on Tuesday with the benchmark composite index rising 1% on continuous buying support in selected plantation stocks. At 5pm, the FBM KLCI gained 15.77 points to 1,599.61, just a whisker below the psychological 1,600 level, compared with 1,583.84 at Monday's close. Regional stock markets, which mostly closed before Russia announced its pullback, were generally lower. Both Japan’s Nikkei 225 and Hong Kong’s Hang Seng Index fell 0.8%. Mainland China’s Shanghai Composite Index rose 0.5%.
Source: PublicInvest Research - 16 Feb 2022
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UEMSCreated by PublicInvest | Mar 21, 2024