Economy

US: Chicago business barometer indicates substantial downturn in Dec. Chicago-area business activity saw a substantial downturn in the month of Dec. MNI Indicators said its Chicago business barometer tumbled to 46.9 in Dec from 55.8 in Nov, with a reading below 50 indicating contraction. Economists had expected the index to drop to 51.0. In the previous month, the Chicago business barometer saw its biggest monthly increase since Sept of 2020, returning to expansionary territory for the first time since Aug 2022. (RTT)

EU: Spain inflation unexpectedly slows in Dec. Spain consumer price inflation unexpectedly slowed in Dec. CPI softened to 3.1% from 3.2% in the previous month, while the rate was expected to climb to 3.4%. Underlying inflation weakened for the fifth consecutive month in Dec. The core inflation was 3.8%, down from 4.5% in Nov. At the same time, EU harmonized inflation held steady at 3.3% in Dec. (RTT)

UK: Consumers to cut back on spending next year, adding to recession risk. UK consumers are increasingly worried about their financial security and holding tighter to their purse-strings heading into 2024, reviving concerns that the economy could tip into a recession. While inflation has now fallen or remained steady for nine consecutive months, 41% of consumers say they’re feeling less financially secure than at the end of 2022. (Bloomberg)

China: Dec factory activity contracted more than expected. China's manufacturing activity contracted for the third consecutive month in Dec, as factories struggled with weak demand, clouding the outlook for the country's economic recovery. The official PMI fell to 49.0 in Dec from 49.4 the previous month, below the 50-mark separating growth from contraction and weaker than a median forecast of 49.5. (Reuters)

South Korea: Inflation climbs 3.2% on year In Dec. Consumer prices in South Korea were up 3.2% on year in Dec. That was shy of expectations for an annual increase of 3.3%, which would have been unchanged from the Nov reading. On a seasonally adjusted monthly basis, consumer prices were flat versus forecasts for an increase of 0.2% following the upwardly revised 0.5% decline in the previous month (originally -0.6%). (RTT)

Singapore: Producer prices continue to fall in Nov. Singapore's producer prices declined for the tenth successive month in Nov, largely driven by a sharp fall in the oil index. The manufacturing producer price index fell at a stable rate of 4.5% YoY in Nov. The oil index plunged 7.8% annually in Nov, and the non-oil index showed a decrease of 3.9%. (RTT)

Markets

Harn Len: Plans RM42.5m purchase of aquaculture business from substantial shareholder Mohamed Nizam Jakel. Harn Len Corporation has proposed to acquire an aquaculture outfit which owns 30 ponds on a 300-acre piece of land in Pekan, Pahang from its substantial shareholder, Mohamed Nizam Jakel, through a RM42.5m share deal. It had entered into a conditional share sale agreement with Nizam to acquire the entire 100,000 shares in Tiger Aquaculture SB (TASB). (The Edge)

Mah Sing: Optimistic on property sector, positive signs of sustained momentum in 2024. Mah Sing Group is optimistic on the mid to long-term outlook for the property sector, supported by strong fundamental demand for properties due to the young population. Demand for houses from first-time house buyers should remain resilient. The group registered RM1.8bn in property sales for the nine-month period ended 30 Sept, 2023, an increase of 14.4% compared with RM1.6bn in the same period last year. (Bernama)

Cengild Medical: Acquires stratified property in KL for RM122.34m. Cengild Medical’s wholly-owned subsidiary, Cengild SB, has entered into a conditional sale and purchase agreement with Sunny Uptown SB for the acquisition of a stratified property in Kuala Lumpur for a cash consideration of approximately RM122.3m. Cengild Medical said the property is part of a proposed construction of a 17-storey medical centre building with a total net floor area of 187,507 sq ft. (The Star)

BCorp: Seeks more time to complete transfer of waste management unit to Naza Corp. Berjaya Corp said the group is seeking an extension of the deadline to complete the transfer of its shares in its waste management unit, Berjaya Enviro Holdings SB (BEnviro), to Naza Corp Holding. BCorp said BEnviro had sought from the Public Private Partnership Unit in the Prime Minister’s Department and Sustainable Energy Development Authority Malaysia (SEDA) an extension of time from 31 Dec to a later date, or after obtaining approval from the Energy Commission of Malaysia. (The Edge)

CAB: Restarts Indonesian tie-up with Salim Group. CAB Cakaran will restart its integrated poultry business in Indonesia with the Salim Group after the Chinese New Year in Feb, with a business plan to invest substantially into the project over the next five years. It was now working to finalise the investment sum for the project. CAB and its partners stalled the project’s implementation three years ago because of the global pandemic outbreak. “We will invest an initial RM100m to start the project, which includes layers and egg operations on Java Island”. (The Star)

Citaglobal: Still in 'active discussion' with Petronas on battery storage system six months after MOU inked. Citaglobal updated that it is still in “active discussion” towards a joint collaboration agreement with Petronas Global Technical Solutions SB (PGTSSB), a wholly-owned subsidiary of Petroliam Nasional, for deployment of a Battery Energy Storage System, six months after both signed the MoU on 27 June. Citaglobal said the “discussion” is especially in the area of deployment of its Generation Two Battery Energy Storage System (Gen2 MYBESS) at various Petronas’ upstream, midstream and downstream businesses such as production platforms, processing plants, and retail stations and outlets. (The Edge)

MARKET UPDATE

The FBM KLCI might open higher today after US stocks closed modestly lower on the last trading day of 2023, capping a robust year-end rally as investors eyed easier monetary policy in the year ahead. The S&P 500, the Dow and the Nasdaq have booked nine consecutive weekly gains ¯ the longest weekly winning streak for the S&P 500 since January 2004, and the longest for the Dow and the Nasdaq since early 2019. The Dow Jones Industrial Average fell 20.56 points, or 0.05%, to 37,689.54, the S&P 500 lost 13.52 points, or 0.28%, to 4,769.83 and the Nasdaq Composite dropped 83.78 points, or 0.56%, to 15,011.35. Meanwhile, European STOXX 600 edged up 0.1% on Friday, posting its seventh straight weekly gain and its best December performance since 2021. It closed the year 12.6% higher, with rate-sensitive technology stocks among the best-performers.

Back home, Bursa Malaysia wrapped up 2023 to close at its intraday low at 1,454,66 on Friday compared with the first-day opening this year at 1,488.54, weighed by persistent selling pressure throughout most part the year due to outflow of funds as a result of various rate hikes in the US. At the closing bell, the KLCI closed 2.75 points or 0.19% lower to 1,454.66 from Thursday’s close of 1,457.41. MSCI's broadest index of Asia-Pacific shares outside Japan was little changed but lurked near a five-month peak and was headed for a 5% gain in the year after two years of heavy losses. The index is up over 11% in the last two months as investors ramped up bets that central banks were done raising interest rates and would soon start easing.

Source: PublicInvest Research - 2 Jan 2024