Economy

US: Consumers saying 'bad time to buy' a house hits 13-year high in July. The share of US consumers who believe it is a bad time to buy a home reached the highest level in at least 13 years in July, according to a survey released, as the supply of available properties remains scarce and home prices appear to have stopped cooling. The portion of US consumers saying now is a “bad time to buy” a new home increased by 4 percentage points in July to 82%, according to a report released by Fannie Mae, the highest level since the mortgage finance giant began conducting the survey in 2010. Consumers’ outlook also appears to have taken a hit, with a net 17% of respondents expecting price increases in the next 12 months, the highest percentage in over a year. (Reuters)

EU: Eurozone investor confidence improves for first time in 4 months. Eurozone investor confidence improved for the first time in four months in August but the currency bloc is assessed to be in recessionary mode, survey results from the behavioral research institute Sentix showed. After falling for three straight months, the Sentix economic index unexpectedly rose to -18.9 in Aug from -22.5 in July. The reading was seen falling to -23.4. The assessment of current situation remains weak and underscores the current recessionary conditions. (RTT)

EU: German industrial output declines on weak auto production. Driven by the weaker automotive and construction output, Germany's industrial production declined more than expected in June, adding concerns of a downward revision to the 2Q GDP data. Industrial production posted a monthly fall of 1.5% in June, following a revised 0.1% drop in May, Destatis reported. Output was forecast to decrease moderately by 0.5%. Automotive industry and construction were the major drag, while the pharmaceutical industry made a positive impact. (RTT)

UK: Job placements decline sharply amid weak economic outlook. The UK job placements posted a sharp decline in July as the weak economic outlook and subdued confidence damped hiring activity, a survey report compiled by S&P Global showed. Permanent staff appointments decreased at the fastest pace in just over three years in July, the KPMG/REC Report on Jobs revealed. Concerns about the future made clients hesitant to take additional staff. At the same time, growth in temp billings dropped at the slowest pace since last Oct. There were faster increases in the supply of both temporary and permanent workers due to redundancies and hiring freezes. (RTT)

Japan: Household spending sinks 4.2% on year in June. The average of household spending in Japan was down 4.2% on year in June, the Ministry of Internal Affairs and Communications said coming in at 275,545 yen. That missed expectations for an annual decline of 4.1% following the 4.0% contraction in May. The average monthly income per household stood at 898,984 yen, down 5.6% on year. On a monthly basis, household spending jumped 0.9% - beating forecasts for an increase of 0.3% after sinking 1.1% in the previous month. (RTT)

Japan: Leading index falls to 108.9. Japan's leading index weakened in June after reaching a 6-month high in May, preliminary data from the Cabinet Office showed. The leading index, which measures future economic activity, dropped to 108.9 in June from 109.1 in May. The coincident index that measures the current economic situation rose to a 10-month high of 115.2 in June from 114.3 in the previous month. Meanwhile, the lagging index climbed to 107.3 from 106.9 in the previous month. The reading was the strongest since Jan 2020. (RTT)

South Korea: Has USD5.87bn current account surplus in June. South Korea posted a current account surplus of USD5.87bn in June, the Bank of Korea said on Tuesday - blowing away forecasts for a surplus of USD0.26bn and up from USD1.93bn in May. The goods account recorded a USD3.98bn surplus. The services account posted a USD2.61bn deficit owing to a deficit in the travel account. The primary income account recorded a USD4.85bn surplus due to an increase in the income on equity. The secondary income account recorded a USD0.35bn deficit. In the financial account, net assets increased by USD4.77bn during June. Direct investment assets decreased by USD1.72bn and direct investment liabilities increased by USD2.56bn. (RTT)

Indonesia: GDP growth tops expectations. Despite falling exports, Indonesia's economy grew at a faster-than-expected pace in the second quarter driven by household and government spending, official data showed on Monday. Gross domestic product registered an annual growth of 5.17% in the 2Q, following first quarter's 5.04% expansion, Statistics Indonesia said. This was faster than economists' forecast of 4.93%. QoQ, Southeast Asia's largest economy grew 3.86%, which was also better than the expected 3.72%. On the expenditure-side, household consumption advanced 5.23% annually and government spending surged 10.62%. At the same time, investment grew 4.63%. Exports and imports decreased 2.75% and 3.08%, respectively. (RTT)

Markets

IHH Healthcare (Outperform, TP: RM7.63): Indirect Indian subsidiary embarks on IPO. IHH Healthcare’s Agilus Diagnostic Ltd, a subsidiary of its 31.17%-owned associate Fortis Healthcare Ltd, will be undertaking an IPO. According to IHH's Bursa Malaysia filing on Mon (Aug 7), the boards of both Fortis and Agilus had at their meetings held on Aug 4, 2023, considered and granted their approval for Agilus to initiate an IPO process via an offer of sale of equity shares to certain existing and eligible shareholders of Agilus in the IPO. (The Edge)

Maxis (Neutral, TP: RM3.90): Appoints MR DIY CEO Adrian Ong as director. Maxis has appointed Adrian Ong Chu Jin as an independent and non-executive director. Ong, 53, has served as CEO of MR. D.I.Y Group (M) since 2019. He is a non-independent executive director of MR D.I.Y Group, Malaysia, and non-executive chairman of MR. D.I.Y Holding (Thailand) Co., Ltd. His experience includes over 29 years in investment banking, private equity, and public accounting across a range of industries. (StarBiz)

Berjaya Corporation: Vincent Tan demands apology, RM200m from Sanusi. Berjaya Corporation founder and advisor Tan Sri Vincent Tan has issued a letter of demand to caretaker Kedah Menteri Besar Datuk Seri Muhammad Sanusi Md Nor, demanding a public apology over allegedly defamatory claims involving the Selangor Maritime Gate (SMG) project. Tan as well as Berjaya Land are also demanding RM200m in compensation. In a statement, the company said the statements have tarnished Berjaya Land's integrity, credit, reputation and image. (New Straits Times)

Optimax Holdings: Secures plastic surgery license for Ipoh specialist centre. Optimax Holdings, an eye specialist service provider, has obtained the license from the MoH Malaysia to offer plastic surgery and aesthetic services at its Optimax Ipoh Specialist Centre. These new services will complement and enhance the group's current offerings, enabling Optimax to leverage on its facilities and team effectively. This strategic integration aligns with Optimax's business expansion strategy to enter the plastic surgery and aesthetic services industry. (New Straits Times)

Yinson Production: Secures USD230m financing in relation to FPSO Maria Quiteria. Yinson Production has secured USD230m in term loan facility, structured and arranged by Global Infrastructure Partners (GIP), in relation to the floating, production, storage, and offloading (FPSO) Maria Quitéria. In a joint statement today, the companies said the loan facility marks the first transaction between Yinson Production and GIP that demonstrates the attractiveness and robust investment outlook of the FPSO industry within the global energy infrastructure market as well as Yinson Production. (StarBiz)

Jerasia: Trading of Jerasia securities continues to be suspended until further notice. Trading in the securities of Jerasia Capital continues to be suspended from 9am on Tues (Aug 8) until further notice. In a bourse filing on Mon, Bursa Malaysia said shares of the apparel manufacturer and fashion retailer would be suspended as it failed to submit its outstanding quarterly report for the financial period ended May 31, 2023 on or before Aug 7, 2023. (The Edge)

Market Update

The FBM KLCI might open higher today after US stocks advanced on Monday, following a global equity sell-off last week, as investors took some positive signs from last week’s jobs report and turned their attention to inflation data due on Thursday. Wall Street’s benchmark S&P 500 gained 0.9%, led higher by tech and media stocks, as well as those in the financial sector. The tech-focused Nasdaq Composite gained 0.6%. Mixed investor sentiment echoed in Europe, as trading volumes were subdued over the August holiday period, and markets awaited more data to settle on a direction. The region-wide Stoxx Europe 600 ended the choppy session 0.1% higher, while France’s Cac 40 gained 0.1% and Germany’s Dax was flat.

Back home, Bursa Malaysia shook off early losses to close mixed Monday, with the benchmark index ending little changed on cautious market sentiment as key economic data from the US and China due later this week weighed on investors’ risk appetite. At the closing bell, the FBM KLCI added 0.6 of a point to 1,445.81 from 1,445.21 at Friday’s Aug 4) close. In the region, the Chinese benchmark CSI 300 lost 0.8%, while Hong Kong’s Hang Seng index was flat.

Source: PublicInvest Research - 8 Aug 2023