Economy

US: Key gauges of US economy paint mixed third-quarter picture. The government’s primary measures of US third-quarter economic activity painted a mixed picture of the economy’s momentum after a lackluster first half of the year. Inflation-adjusted GDP, or the total value of all goods and services produced in the economy, increased at a 2.9% annualised rate during the period, Commerce Department data showed. (Bloomberg)

US: Pending home sales decrease for fifth straight month in Oct . Pending home sales in the US decreased for the fifth consecutive month in Oct, according to a report released by the National Association of Realtors. NAR said its pending home sales index tumbled by 4.6% to 77.1 in Oct after plunging by 8.7% to a revised reading of 80.8 in Sept. Economists had expected pending home sales to slump by 5.2% compared to the 10.2% nosedive originally reported for the previous month. (RTT)

EU: Inflation finally slows in sign of hope for ECB . Eurozone inflation slowed for the first time in one-and-a-half years, offering a glimmer of hope to ECB in its struggle to quell the worst consumer price shock in a generation. The reading for Nov was 10%, Eurostat said, less than the 10.4% median estimate of economists surveyed by Bloomberg. The drop, from 10.6% in Oct, was the biggest since 2020 and was thanks to slower advances in energy and service costs, even as food prices grew more quickly. (Bloomberg)

EU: German unemployment increases more than expected . Germany's unemployment increased more than expected in November as energy crisis and weaker demand dampened activity particularly in the manufacturing sector. The number of people out of work increased by 17,000, which was larger than economists' forecast of 13,000 and also Oct's rise of 9,000, data from the Federal Labor Agency revealed. (RTT)

China: Home sales slump persists even as rescue efforts mount . China’s home sales slump persisted in Nov, underscoring the challenge for policy makers as they seek to revive the embattled industry. The 100 biggest real estate developers saw new-home sales drop 25.5% from a year earlier to CNY559bn (USD78.9bn) in Nov, according to preliminary data from China Real Estate Information Corp. That narrowed from a 28% decline in Oct. (Bloomberg)

South Korea: GDP expands 0.3% on quarter in 3Q . South Korea's GDP added a seasonally adjusted 0.3% on quarter in the third quarter of 2022, the Bank of Korea said - in line with expectations following the 0.7% growth in the three months prior. On an annualized basis, GDP climbed 4.1% - again matching forecasts and up from 2.9% in the previous three months. (RTT)

New Zealand: House prices suffer biggest annual drop in 13 years . New Zealand house prices suffered their biggest annual decline in more than 13 years in Nov as the central bank stepped up its inflation fight with a record interest-rate increase. Prices fell 2.9% from a year earlier, the largest YoY drop since July 2009, CoreLogic New Zealand said. Values fell for an eighth consecutive month, sliding 0.6% from Oct. The average house price eased to NZD958,622 (RM2.66m). (Bloomberg)

Markets

Genting Bhd (Outperform, TP: RM5.80): Plans to sell some of its Miami real estate.

Comment: Genting is seeking over USD1bn for the 15.5-acre waterfront assemblage. It is one of the largest pieces of undeveloped land in South Florida that Genting acquired in 2011 during the Miami-Dade County land sales, which was reported to cost USD236m. This is not the first time Genting is exploring the possibility of selling its Miami land. Should it materialise this time round, we are positive as it helps to monetize this non-core asset and will be able to re-deploy resources to its core gaming operations. It plans to bid on one of the three new casino licenses in New York, which will be awarded next year. We maintain our Outperform call on Genting.

Axiata (Neutral, TP: RM3.60), Digi.Com (Neutral, TP: RM3.83): Telenor announce completion of Celcom-Digi merger. The merger of Celcom Axiata Bhd and Digi.com Bhd’s telco operations have been completed, according to a joint statement from Axiata Group Bhd, Digi.com and the latter’s parent company, Telenor Asia Pte Ltd. With the merger completion, Axiata and Telenor (parties) now have equal ownership of 33.1% each in the newly-merged entity named Celcom Digi. (The Edge)

Capital A (Neutral, TP: RM0.69): Posts bigger loss in 3Q, maintains positive outlook. Capital A’s net loss for the 3QFY22 ballooned to RM901.3m, from RM887m in the same quarter last year due to one-off items and unrealised foreign exchange losses. Excluding one-off items, the net operating loss amounted to RM322m. (StarBiz)

MAHB: Oct 2022 passenger traffic at 71% of pre-Covid levels. Malaysia Airports Holdings Bhd (MAHB) recorded 8.3m passengers across its network of airports in Oct 2022, amounting to 71.1% of 11.7m passengers recorded in the pre-pandemic period of Oct 2019. (The Edge)

TCS: Bags RM120m contract for service condo project in PJ. TCS Group Holdings announced its wholly owned subsidiary TCS Construction SB has bagged a RM119.6m contract from Eupe PJ South Development SB for the construction and completion of main building works for a service condominium project known as Helix2. (The Edge)

MRCB: Returns to black in 3Q. Malaysian Resources Corp Bhd (MRCB) registered a net profit of RM23.7m for the 3QFY22, versus RM32.2m net loss in last year’s corresponding quarter, as revenue jumped 524% YoY to RM860m. (The Edge)

NCT Alliance: Nine-month earnings jump 73% to RM30.4m. NCT Alliance's net profit for the 9MFY22 rose 73% to RM30.4m from RM17.6m a year earlier. (The Edge)

IPO: TTV signs underwriting agreement for ACE Market listing. TT Vision Holdings Bhd (TTV) which will soon be listed on the Ace Market intends to utilise the proceeds gained from the IPO to expedite its growth and pursue its business plans. (StarBiz)

Market Update

The FBM KLCI might open higher today after US stocks had the first streak of back-to-back monthly gains since 2021, with a gradual upward trend punctuated with a sharp rally on the last day of November. Wall Street’s benchmark S&P 500 closed 3.1% higher on Wednesday, bringing gains in November to 5.4%. The tech heavy Nasdaq Composite index added 4.4% on the day and also rose a total of 4.4% last month. Wednesday’s strong performance came after a speech from Federal Reserve chair Jay Powell in which he suggested that it may be appropriate to slow the pace of interest rate increases. Powell suggested that the US central bank is preparing to raise its benchmark rate by 0.5 percentage points when its monetary policy committee gathers in December, after a string of 0.75-point increases. European stocks also rose on Wednesday, with the regional Stoxx Europe 600 up 0.6% and London’s FTSE 100 gaining 0.8%.

Back home, Bursa Malaysia recouped early losses to end in the positive territory on Wednesday as bargain-hunting emerged in selected heavyweights in utilities, consumer products and services, as well as industrial products and services counters. At the closing bell, the FBM KLCI rose 11.84 points to 1,488.8 from Tuesday's closing of 1,476.96. In the region, Hong Kong’s Hang Seng index gained 2.2% after rising sharply in the previous session, as investors bet that China would push ahead with reopening plans following anti-lockdown protests. China’s CSI 300 added 0.1%.

Source: PublicInvest Research - 1 Dec 2022