Economy 

US: Budget deficit mushrooms in May as revenue falls, Medicare outlays jump. The US budget deficit swelled in May from a year earlier as revenue tumbled and Medicare spending surged, the Treasury Department said in its first monthly accounting of the government’s finances since a deal was reached to suspend the   debt limit and avoid a first-ever federal default. The May deficit shot up to USD240bn from USD66bn a year earlier, more than offsetting the USD176bn surplus recorded in April. T (Reuters)

US: Inflation outlook hits two-year low in latest New York Fed survey Consumers are growing more optimistic that inflation is on the way down, according to a New York Federal Reserve survey released Monday. The central bank’s monthly Survey of Consumer Expectations for May showed one-year inflation expectations down 0.3 ppts to a 4.1% rate. That’s the lowest annual outlook since May 2021, just as inflation was beginning to spike to its highest level in more than 41 years. (CNBC)

EU: Turkey current account gap widens in April. Turkey's current account deficit widened in April largely due to the outflows in primary and secondary income, data published by the Central Bank of the Republic of Turkey. The current account deficit increased to USD5.4bn from USD4.9bn in March. The deficit on trade in goods totaled USD7.0bn compared to a USD6.3bn shortfall a month ago. The surplus on services trade increased to USD2.92bn from USD2.66bn in March. Under services, travel item recorded a net inflow of USD2.20bn. (RTT)

China: Several lenders cut yuan deposit rates. Several Chinese commercial banks cut interest rates on a range of yuan deposits from Monday, following their larger peers in a coordinated move to ease pressure on profit margins. The deposit rate cuts follow a similar move by China's biggest state lenders on Friday and marks the second such industry-wide cut within a year, with previous action taken in Sep. (Reuters)

Japan: Wholesale inflation eases, goods close to consumers continue to rise. Japan's wholesale inflation slowed for a fifth consecutive month in May because of sliding fuel and commodity prices, a sign cost-push pressure that has driven up consumer inflation may be subsiding. The data underscores the central bank's view that consumer inflation will slow in coming months as global commodity prices slide from last year's peak levels. The BoJ is expected to maintain ultra-loose policy this week and stick with its forecast for a moderate economic recovery, as robust corporate and household spending cushion the blow from slowing overseas demand. (Reuters)

India: Industrial output rose 4.2% YoY in April. India's industrial output rose 4.2% YoY in April. Analysts in a Reuters poll had forecast an expansion of 1.8%. In March, output growth was revised to 1.7% from 1.1%. Manufacturing, which accounts for about 17% of the Indian economy, rose 4.9% YoY in April compared with a provisional 0.5% YoY growth reported in March. Electricity generation during April fell 1.1% over the same period a year earlier, while mining activities increased 5.1%, the data showed. In the month of March, electricity generation provisionally fell 1.6%, while mining activities provisionally increased 6.8%. Consumer durables fell 3.5% YoY in April, after a decline of 8.4% in the previous month. (Reuters)

Indonesia: Consumers more optimistic in May. Indonesia's consumer confidence improved in May to the highest level in one year, supported by better assessments of current and future economic conditions, survey data from the Bank of Indonesia. The consumer confidence index rose to 128.3 in May from 126.1 in the previous month. A reading above 100 indicates optimism among households. (RTT)

Markets

Kim Teck Cheong: To transfer to Main Market. Kim Teck Cheong Consolidated will be transferred to the Main Market of Bursa Malaysia from the ACE Market on June 15. The stock’s short name KTC and stock number of 0180 will remain unchanged. Kim Teck Cheong closed one sen, or 4.08% higher, at 26 sen with 431,100 shares traded. The group, which was listed on the ACE Market in 2015, is engaged in the distribution and warehousing services of third-party consumer packaged goods in Sabah and Sarawak. (StarBiz)

Boustead Holdings: To be suspended on June 20 on LTAT’s successful takeover bid. Trading in shares of Boustead Holdings (BHB) will be suspended from Bursa Malaysia Securities on June 20, after its major shareholder Lembaga Tabung Angkatan Tentera's (LTAT) control of a 97.63% stake in the group. LTAT announced the successful takeover bid after its offer for BHB closed at 5pm on Monday (June 12). As such, the Armed Forces Fund Board will procure BHB to take the requisite steps to withdraw its listing status from Bursa Malaysia, in accordance with paragraph 16.07 of the Listing Requirements. (The Edge)

Sancy: To manage patient information system for Bangladesh's Aichi Healthcare. Digital healthcare solutions provider Sancy's associate company, Sancy Global Solutions SB, has entered into an agreement to implement and manage an automation system for storing patient information at Aichi Healthcare Group in Bangladesh. It would commence work immediate with the agreement set to continue indefinitely. This agreement aligns perfectly with our mission to deliver cutting-edge solutions that enhance healthcare operations and improve patient care (The Edge)

Barakah: PBJV secures Petronas licence for three years. Barakah Offshore Petroleum said its wholly-owned subsidiary, PBJV Group SB, has secured a three-year license from Petroliam Nasional (Petronas). This comes two months after the national oil corporation lifted the suspension against PBJV for the license imposed in 2019. It added that Petronas granted the license to PBJV with full reinstatement of SWEC (Standardised work and equipment categories) code in respect of all its 27 approved license categories. (The Edge)

TPC Plus: To purchase Rembau land for RM5.2m. Egg producer TPC Plus is buying four pieces of freehold agricultural land measuring 40 acres in Rembau, Negeri Sembilan for RM5.2m, or RM130,000 per acre. Its wholly owned subsidiary Teck Ping Chan Agriculture SB (TPCA) had entered into a SPA with Mun Wah Estate SB on June 12 for the acquisition. The net book value of the land is RM1.17m. (The Edge)

Mestron: Proposes a transfer to Main Market of Bursa Malaysia. Specialty pole maker Mestron Holdings has today proposed to transfer the listing and quotation for its entire issued share capital and outstanding warrants from the ACE Market to the Main Market of Bursa Malaysia Securities. A filing with Bursa Malaysia today shows that the leading manufacturer of specialty poles in the country has also proposed an amendment to the constitution of MHB to facilitate the implementation of its proposed transfer exercise. (Focus Malaysia)

Market Update

The FBM KLCI might open higher today after US stocks advanced to their highest level in more than a year on Monday, with investors adding to a rally powered by shares of large tech companies. The blue-chip S&P 500 increased 0.9% to close at 4,338.93, surpassing a peak reached last August to mark its highest point since April 2022. The tech-heavy Nasdaq Composite index rose 1.5% to a level that was also the highest in almost 14 months. Stocks remain well below all-time highs reached at the start of 2022, but they have begun the year strongly. In Europe, the region-wide Stoxx 600 closed 0.2% higher, while France’s Cac 40 added 0.5% and Germany’s Dax advanced 0.9%.

Back home, Bursa Malaysia maintained its upbeat momentum to close higher on Monday, driven by bargain-hunting on improved market sentiment. At the closing bell, the FBM KLCI had improved 10.69 points, or 0.78%, to 1,386.77, from 1,376.08 at last Friday’s close. In the region, equities rose, with China’s CSI 300 up 0.2%, while Hong Kong’s Hang Seng index added 0.1% and Japan’s Topix advanced 0.7%.

Source: PublicInvest Research - 13 Jun 2023