Economy

US: Job growth slowing, but wage gains remain strong. The US economy added fewer jobs than expected in July, but solid wage gains and a decline in the unemployment rate back to 3.5% pointed to continued tightness in labour market conditions. (Reuters)

US: Fed's Bowman says more US rate hikes likely will be needed. The US Federal Reserve will likely need to raise interest rates further to bring down inflation, Governor Michelle Bowman said. Bowman said she supported the Fed's quarter-point increase in interest rates last month, given still-high inflation, strong consumer spending, a rebound in the housing market and a labour market that is helping to feed higher prices. (RTT)

EU: Eurozone retail sales fall 0.3% in June. Eurozone retail sales decreased unexpectedly in June after rising in the previous month, data from Eurostat revealed. Retail sales fell 0.3% MoM in June, reversing a 0.6% increase in May, which was the rise in four months. Meanwhile, economists had forecast sales to rise by 0.2%. Food, drink, and tobacco sales declined 0.3%, and non-food product turnover dropped 0.2%. (RTT)

EU: German factory orders recover; construction shrinks sharply. Germany's factory orders unexpectedly grew in June but the improvement was driven by the large scale orders in the aerospace industry, data from Destatis showed. Elsewhere, a private survey today showed that the construction sector contracted sharply at the start of the third quarter, led by a notable decline in residential building activity. (RTT)

EU: Spain industrial production falls 3.0%, more than forecast. Spain's industrial production declined for the third straight month in June and at a faster-than-expected pace, largely due to a fall in the output of energy and intermediate goods, preliminary data from the statistical office INE showed. Industrial production declined by an adjusted 3.0% YoY in June, which was worse than the 0.6% drop in May. (RTT)

UK: Construction rebounds in July. UK construction activity returned to growth territory at the start of the 3Q, driven by faster gains in commercial building and civil engineering activity, survey results from S&P Global showed. The Chartered Institute of Procurement & Supply Construction Purchasing Managers' Index, or PMI, rose to 51.7 in July from 48.9 in June. The score was expected to fall to 48.0. A reading above 50 suggests growth, while any score below 50 indicates contraction in the sector. (RTT)

Australia: RBA policy statement boosted case for stable rates, Westpac. The Reserve Bank of Australia's latest Statement of Monetary Policy released has strengthened the case for stability in interest rates as the bank considers inflation risks as "evenly balanced" and policymakers seem relaxed about how fast inflation can be brought to target, Westpac Chief Economist Bill Evans said in a note. (RTT)

Singapore: Retail sales growth eases to 1.1%. Singapore's retail sales growth eased further at the end of the second quarter, data from the Department of Statistics showed. Retail sales climbed 1.1% YoY in June, slower than the 1.8% gain in May. Excluding motor vehicles, retail sales also grew 2.5% annually in June after a 1.7% increase in the preceding month. In June, most industries recorded annual increases. (RTT)

Philippine: Inflation eases to 4.7%, lowest in 16 months. The Philippines' consumer price inflation eased further in July to the lowest level in more than a year, largely driven by a fall in transport costs, data from the Philippine Statistical Authority showed. The CPI, climbed 4.7% YoY in July, slower than the 5.4% rise in June. Meanwhile, economists had forecast inflation to ease to 5.0%. (RTT)

Markets

TNB (Outperform, TP: RM12.42): To collaborate with Electricite Du Laos to boost cross-border RE trade. Tenaga Nasional Bhd (TNB) has presented a letter of intent to Laos’ Electricite Du Laos (EDL) to collaborate in facilitating cross-border renewable energy (RE) trade and human capital development. This is part of TNB’s ongoing drive to strengthen the Asean Power Grid (APG) interconnectivity and to reinforce TNB Power Generation SB (TNB Genco)'s presence as the power generation arm in Asean countries. (The Edge)

EA Technique: Bags two contracts from MISC worth RM12m. EA Technique (has clinched two contracts for the supply and operating of marine vessels worth RM12.6m. The group has been awarded two contracts from Sungai Udang Port SB (SUPSB), a wholly-owned subsidiary of MISC Maritime Services SB via a letter of award dated July 27, 2023. (The Edge)

Scomi Energy: In talks to acquire marine assets from Duta Marine. Scomi Energy Services Bhd (Scomi Energy) is looking to acquire Duta Pacific Offshore SB, among others, from Duta Marine SB. The PN17 company told Bursa Malaysia that it had entered into a heads of agreement (HOA) with Duta Marine for the proposed investment. (The Edge)

Magna Prima: To sell land in PJ at RM4m loss. Magna Prima is selling its entire equity interest in loss-making 33 Sentral Park SB, which owns two pieces of adjoining residential land measuring a total of 6.9 acres and fronting Jalan Gasing in Petaling Jaya, Selangor, to Glomics Holding SB (GHSB) for RM65m. The proposed disposal is expected to result in a loss on disposal of RM3.73m for the group for the FYE 31 Dec 2023. (The Edge)

Fitters Diversified: Terminates land disposal on failure of payment from buyer. Fitters Diversified has terminated its initial 18.97-hectare land disposal to Aikbee Development (Kepong) SB for RM36m, owing to the buyer’s failure of payment. The disposal had been terminated due to Aikbee’s failure to pay the balance purchase price on or before the extended completion date. (The Edge)

Citaglobal: Acquires stake in solar PV players to boost RE footprint. Citaglobal is acquiring a 60% stake in registered solar photovoltaic (PV) provider Spectra Suria SB (SSSB) for RM2m and a 40% stake in Nova Reeco SB (NRSB), a solar PV investor company, for RM3m. Both acquisitions come with an orderbook of RM268m, boosting Citaglobal's total orderbook to RM1.27bn. (BTimes)

Eksons: Reprimanded by Bursa. Bursa Malaysia has publicly reprimanded Eksons Corp for failing to comply with the listing requirements. Eksons failed to ensure that its fourth quarterly report for the year ended March 31 2022 announced on May 30 had taken into account the revisions stated in its announcement on July 29. (BTimes)

IPO: Engineering solutions provider Kawan Renergy eyes ACE Market listing. Engineering solutions provider Kawan Renergy, which is also an independent power producer involved in power generation and the sale of electricity, is seeking an IPO on the ACE Market of Bursa Malaysia to raise funds for its investment in a new 2MW power plant, among others. (The Edge)

Market Update

The FBM KLCI might open lower today after Wall Street stocks notched their longest daily losing streak in three months, sliding on Friday as investors weighed weaker-than-expected US jobs growth and earnings from Big Tech “megacaps”. The S&P 500 fell 0.5%, reversing gains from earlier in the session. It shed 2.3% for the week. The tech-focused Nasdaq Composite closed 0.4% lower, falling 2.8% across the five sessions. The non-farm payrolls report released on Friday showed the US economy added 187,000 jobs in July, fewer than the 200,000 forecast of economists polled by Reuters. In Europe, the region-wide Stoxx Europe 600 index ended the day 0.3% higher, while France’s Cac 40 was up 0.8% and Germany’s Dax rose 0.4%.

Back home, Bursa Malaysia snapped a three-day losing streak to close 0.23% higher on bargain-hunting, particularly for healthcare, financial services, and property counters, in tandem with the uptrend on most regional bourses on Friday. At the closing bell, the FBM KLCI had strengthened by 3.36 points to 1,445.21, from 1,441.85 at Thursday’s close. In the region, China’s benchmark CSI 300 gained 0.4% and Hong Kong’s Hang Seng rose 0.6% after the People’s Bank of China pledged to divert financial resources to the country’s struggling private sector. Japan’s Topix rose 0.3%.

Source: PublicInvest Research - 7 Aug 2023