Economy

US: Consumer sentiment improves slightly more than initially estimated in Jan. The consumer sentiment index for Jan was upwardly revised to 64.9 from the preliminary reading of 64.6. Economists had expected the index to be unrevised. With the upward revision, the consumer sentiment index is well above the Dec reading of 59.7 and at its highest level since hitting 65.2 in April 2022. Consumer sentiment confirmed the preliminary Jan reading, remaining low from a historical perspective but continuing to lift for the second consecutive month. (RTT)

EU: Eurozone credit growth slowdown suggests rate hike impact. Eurozone M3 money supply growth eased more than expected in Dec and credit to the private sector grew at a slower rate suggesting that the interest rate hikes are starting to take effect on the real economy. ECB data showed that the annual growth rate of credit to the private sector moderated to 4.2% in Oct from 4.4% in Sept. Similarly, the adjusted loans to the private sector rose 4.2% versus 5.1% in the prior month. Among the borrowing sectors, the annual growth rate of adjusted loans to households decreased to 5.3% in Dec from 6.2% in Nov. (RTT)

EU: Austria manufacturing downturn eases in Jan. Austria's manufacturing contraction continued to moderate at the start of the year, as supply constraints and falling demand woes eased amid cooling inflationary pressures. The UniCredit Bank Austria manufacturing PMI rose to 48.4 in Jan from 47.3 in Dec. However, a score below 50.0 indicates contraction. The latest reading was the highest in four months, and indicated that the sector was moving toward stabilization at the start of the year. Production declined at the weakest pace in six months. (RTT)

EU: Ireland retail sales remain flat in Dec. Ireland's retail sales remained unchanged at the end of the year, after falling in the previous month, damped by a slump in sales of clothing and footwear and textiles. The volume of retail sales showed no variation over the month, following a 0.9% fall in Nov. Among categories, the largest monthly increase was observed in sales of motor trades, rising 4.0%. This was largely offset by a 16.8% plunge in sales of clothing, footwear, and textiles. A 7.7% fall was also seen in electrical goods sales. On a yearly basis, retail sales climbed 0.5% in Dec, in contrast to a 3.6% drop in Nov. Further, this was the first increase in eight months. At the same time, the sales value rose 8.3% yearly and by 0.5% monthly in Dec. (RTT)

India: India's sunoil imports rise to record as Russia-Ukraine fight for market share. India's Jan sunflower oil imports are set to surge to a record 473,000 tonnes, nearly triple average monthly imports as top exporters Russia and Ukraine seek to reduce stockpiles. Record imports by India, the world's biggest vegetable oil importer, come as sunoil's discount to rival soyoil widened to the highest level in nine months. The import surge will help key Black Sea producing countries in reducing their stocks, but could dampen India's palm oil imports and weigh on Malaysian palm oil prices. Sunoil was trading at discount to soy oil in Dec. (Reuters)

New Zealand: Records NZD475m trade deficit. New Zealand posted a merchandise trade deficit of NZD475m in Dec. That beat forecasts for a shortfall of NZD1.8bn following the downwardly revised NZD2.2bn deficit in Nov (originally NZD1,863m). Exports rose 11% on year to NZD6.7bn, down from the downwardly revised NZD6.3bn in the previous month (originally NZD6.7bn). Imports climbed an annual 1.8% to NZD7.2bn following the downwardly revised NZD8.52bn a month earlier (originally NZD8.54bn). For the fourth quarter of 2022, goods exports fell 3.2% (NZD618m), following a 7.5% rise in Q3. Goods imports fell 1.1% (NZD258m), following a 11% rise in Q3. The quarterly trade balance was a deficit of NZD4.2bn. (RTT)

Markets

Digi.com (Neutral, TP: RM3.83): Proposes change of name to CelcomDigi Bhd . Digi.com announced a proposal to change its name to CelcomDigi Bhd following its successful merger with Celcom Axiata. The company said the proposed change of name was in conformance with the company’s obligation under the share purchase agreement dated June 21, 2021 with Axiata Group Bhd in relation to the merger with Celcom Axiata. (Bernama)

Revenue Group: Confirms arrest of two suspended directors by MACC over alleged false claim . Revenue Group has confirmed that two of its directors have been arrested by the Malaysian Anti Corruption Commission (MACC) over an alleged false claim relating to the purchase of thermal printing paper worth more than RM400,000. It clarified that its business and operation are not affected by MACC’s arrest of the two directors as they have been suspended from their executive functions earlier (The Edge)

AirAsia X: Sept-Dec 2022 passenger count quadruples QoQ . AirAsia X (AAX) flew 337,638 passengers in the quarter ended Dec 2022 (6QFY2022), up 324.4% QoQ from 79,557 passengers in the July-Sept 2022 period, as travel recovery gained momentum in tandem with the peak travel season. Passenger load factor rose to 79%, from 73% in 5QFY2022, as it focused on flying “the most popular and profitable routes first”, AAX said. (The Edge)

LYC Healthcare: Unit set to be listed on SGX-ST in first half of 2023 . LYC Healthcare is expecting the listing of its subsidiary, LYC Medicare (Singapore) Pte Ltd (LYCSG), on the Catalist Board of the Singapore Exchange Securities Trading Ltd (SGX-ST) to be completed by the first half of 2023. LYC Healthcare said the proposed listing would raise gross proceeds of SGD11.2m (SGD1=RM3.228) and would accrue entirely to LYCSG. (Bernama)

MAHB: Sees record high domestic passenger numbers at 6.8m in Dec . Malaysia Airports Holdings (MAHB), meanwhile, saw monthly passenger movements reaching a record high in Dec 2022, with 6.8m passengers for its operations in Malaysia. The year-end holiday season contributed to the significant 31% increase from the preceding month, and enabled the airport operator to reach 50% of 2019 levels for its Malaysian operations. (The Edge)

SCIB: Withdraws from JB specialist hospital project . Sarawak Consolidated Industries (SCIB) has withdrawn from engineering, procurement, construction and commissioning (EPCC) contracts involving Kencana Healthare SB's specialist hospital project located in Johor Bahru. (StarBiz)

HeiTech Padu: Bags RM38.6m ICT contract from Higher Education Ministry. Technology services and solutions provider HeiTech Padu has bagged a RM38.6m contract from the Ministry of Higher Education (MOHE). The company said the contract was for the provision of centralised lease-to-use services for information and communications technology (ICT) equipment covering five zones in Johor, Melaka, and Negeri Sembilan. “The contract is for a period of 52 months, running from Feb 1, 2023, till May 31, 2027,” it said. (Bernama)

Market Update

The FBM KLCI might open higher today after US stocks ended last week higher as investors weighed the latest batch of corporate results and economic data and looked ahead to the Federal Reserve’s upcoming interest rate decision this Wednesday. Wall Street’s benchmark S&P 500 added about 0.2% on Friday to gain 2.5% for the week. The tech-heavy Nasdaq Composite finished almost 1% higher on the day, bringing its advance over the past five sessions to 4.3%. Reporting season steps up a gear next week, but several well-known companies have in recent days provided results and outlooks for investors’ consideration. Oil major Chevron slipped 4.4% on Friday as it reported record full-year earnings, but a decline in fourth-quarter profits from three months earlier. Credit card company American Express jumped 10.6% after it reported a 25% increase in full-year revenue to a record of almost $52.9bn and issued a better than forecast outlook for 2023. Europe’s region-wide Stoxx 600 closed up 0.3%, Germany’s Dax rose 0.1% and London’s FTSE 100 was marginally higher.

Back home, Bursa Malaysia ended mixed on Friday with the barometer index declining for three straight days during the holiday shortened week, bucking the strong performance of key regional bourses. At the closing bell, the benchmark FBM KLCI eased 0.84 of-a-point to 1,497.55 from Thursday’s close of 1,498.39. In the region, Hong Kong’s Hang Seng index rose 0.5%, Japan’s benchmark Nikkei 225 increased almost 0.1% and South Korea’s Kospi gained 0.7%. Markets in China are closed for the lunar New Year holiday.

Source: PublicInvest Research - 30 Jan 2023