PublicInvest Research

PublicInvest Research Headlines - 27 Apr 2022

PublicInvest
Publish date: Wed, 27 Apr 2022, 12:00 AM
PublicInvest
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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

US: New home sales show substantial decrease in March. A report released by the Commerce Department showed a steep drop in US new home sales in the month of March. The Commerce Department said new home sales plunged by 8.6% to an annual rate of 763,000 from an upwardly revised rate of 835,000 in Feb. Economists had expected new home sales to decrease by 0.9% to a rate of 765,000 from the 772,000 originally reported for the previous month. The steep drop in new home sales came as new home sales in the South plummeted by 10.2% to a rate of 414,000, while new home sales in the Midwest plunged by 8.7% to a rate of 94,000. (RTT)

US: Durable goods orders rebound in March. New orders for US manufactured durable goods rebounded in the month of March, according to a report released by the Commerce Department. The report showed durable goods orders climbed by 0.8% in March after tumbling by a revised 1.7% in Feb. Economists had expected durable goods orders to jump by 1.0% compared to the 2.2% slump originally reported for the previous month. Excluding orders for transportation equipment, durable goods orders surged by 1.1% in March after falling by 0.5% in Feb. Ex-transportation orders were expected to increase by 0.6%. (RTT)

US: Jobless claims edge slightly lower to 184,000. The Labor Department released a report showing a slight decrease in first-time claims for US unemployment benefits in the week ended April 16th. The report showed initial jobless claims edged down to 184,000, a decrease of 2,000 from the previous week's revised level of 186,000. Economists had expected jobless claims to dip to 180,000 from the 185,000 originally reported for the previous week. "We expect initial claims to remain below 200k in the weeks ahead, as  employers, who continue to struggle to attract and retain workers, will keep layoffs to a minimum," said Nancy Vanden Houten, Lead US Economist at Oxford Economics. (RTT)

US: Consumer confidence dips in April. US consumer confidence edged down in April, though households planned to buy automobiles and many appliances, which should help to underpin consumer spending in the 2Q. The Conference Board said its consumer confidence index nudged down to a reading of 107.3 this month from a slightly upwardly revised 107.6 in March. “The Present Situation Index declined, but remains quite high, suggesting the economy continued to expand in early 2Q,” said Lynn Franco, senior director of economic indicators at The Conference Board in Washington. (Reuters)

UK: Government borrowing declines. The UK public sector net borrowing decreased in the year ended March, but remained the third-biggest on record, the Office for National Statistics said. In the financial year ending March 2022, the budget deficit excluding banks totaled GBP151.8bn or around 6.4% of GDP. Borrowing was less than half of the GBP317.6bn borrowed in the same period last year. However, this was the third-highest borrowing since records began in 1947 and also GBP24bn more than the GBP127.8bn projected by the Office for Budget Responsibility. At the end of March, public sector net debt was GBP2.34trn, or around 96.2% of GDP. (RTT)

Japan: Jobless rate falls to 2.6% in March. The unemployment rate in Japan came in at a seasonally adjusted 2.6% in March, the Ministry of Internal Affairs and Communications said. That was shy of expectations for 2.7%, which would have been unchanged from the Feb reading. The jobs-to-applicant ratio was 1.22, matching forecasts and up from 1.21 in the previous month. The participation rate was 62.1%, topping forecasts for 62.0% and up from 61.8% a month earlier. (RTT)

South Korea: Consumer confidence ticks higher in April. Consumer confidence in South Korea was up slightly in April, the Bank of Korea said with a consumer confidence index score of 103.8 - up from 103.2 in March. Consumer sentiment for current living standards was two points higher than in March at 92, and the outlook was one point lower at 94. Consumer sentiment related to future household income and future household spending were both unchanged, at 99 and 114, respectively. Consumer sentiment concerning current domestic economic conditions was three points higher at 74, and the outlook was unchanged at 87. (RTT)

South Korea: 1Q GDP expands 0.7% on quarter. South Korea's GDP gained a seasonally adjusted 0.7% on quarter in the first three months of 2022, the Bank of Korea said in advance estimate. That exceeded expectations for an increase of 0.6% following the 1.2% expansion in the previous three months. Real gross domestic income increased 0.6% on quarter and 0.1% on year. (RTT)

Singapore: Industrial production growth slows in March. Singapore's industrial production increased at a softer pace in March, data from the Economic Development Board showed. Industrial output rose 3.4% YoY in March, after a 17.5% growth in Feb. Excluding biomedical manufacturing, industrial production rose 9.7% yearly in March, after a 16.6% increase in the preceding month. On a monthly basis, industrial production dropped 12.6% in March, after a 16.8% growth in the previous month. Transport engineering grew 20.7% YoY in March. (RTT)

Markets

Malayan Flour Mills: Works on price adjustment as commodity prices stay volatile. Malayan Flour Mills (MFM) is working on a price adjustment proposal among several measures to mitigate business uncertainties due to volatile commodity prices. It did not specify the details of MFM's price adjustment proposal however, indicated that MFM intends to drive more efficient trade spend to protect their profit margin. (The Edge)

Pentamaster: Eyes expansion to Germany, setting up offices in Indonesia, Middle East. Pentamaster Corporation will continue to further strengthen its geographical footprint in 2022 and next year through its products and solutions. The Group will extend its footprint to Germany in 2022 and opening offices in Indonesia and the Middle East by 2023. (The Edge)

KPower: Proposes to acquire One River Power for RM130m. KPower has proposed to acquire the entire stake in hydro power plant developer One River Power for RM130m, to be satisfied via a combination of cash and issuance of new shares in the group. One River Power is principally involved in the development of three hydro power plants based in Sabah with a total combined power generation of 29.1MW. (The Edge)

CN Asia: Seeks to ratify diversification to include moneylending business. CN Asia Corp has proposed to ratify the diversification of the group's business to include moneylending business. It is proposing to seek shareholders' approval for the ratification at an extraordinary general meeting to be convened. (The Edge)

Comintel: Secures RM34m works subcontract for government office, training centre. Comintel Corp has bagged a subcontract worth RM33.78m relating to the construction of an office and training centre for a government department. The company said the job awarded by Pertama Makmur SB includes builder works and mechanical works. The subcontract is slated to commence on June 7, to be completed within 20 months. (The Edge)

Country Heights: Plans RM250m capex for omni-channel business with China's JD.Com. Country Heights Holdings intends to invest about RM250m in capex for the next five years following its partnership with JD.com to develop an omni-channel business model in Malaysia. (BTimes)

IPO: Listing-bound MN Holdings bags RM32.5m jobs. MN Holdings has secured RM32.5m of underground utilities and substation engineering services and solutions contracts in Selangor and Johor. MNHB received a Letter of Award appointing it to be the sub-contractor to provide horizontal directional drilling construction works for RM7.8m. (BTimes)

Market Update

The FBM KLCI might open lower today after US tech stocks dropped on Tuesday, pushing the Nasdaq Composite index to its lowest level in more than a year, as traders adopted caution ahead of quarterly financial updates from some of the world’s biggest consumer technology groups. The technology-heavy Nasdaq Composite was 3.95% lower at the end of Tuesday — its lowest closing level since December 2020. It was the biggest single-day decline since September 2020. The moves came in advance of earnings after the closing bell from Microsoft and Google parent Alphabet, as investors questioned whether such companies have retained adequate pricing power to deal with surging global inflation. The broader S&P index closed 2.8% lower. Apple, Amazon and Facebook owner Meta will post earnings later this week, after streaming platform Netflix shocked investors by revealing it was losing subscribers for the first time in 10 years. In Europe, the regional Stoxx 600 share index closed 0.9% lower after advancing earlier in the session.

Back home, Bursa Malaysia closed broadly higher as investors took the opportunity to bargain hunt for cheaper stocks following Monday's decline. The benchmark FBM KLCI rose 6.7 points or 0.42% to 1,596.68 from Monday’s close of 1,589.98. The regional markets were mixed. The overall Hang Seng share index edged 0.3% higher, while mainland China’s CSI 300 fell a further 0.8% after dropping 4.9% on Monday in its worst day in more than two years.

Source: PublicInvest Research - 27 Apr 2022

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