HEADLINES

Economy

US: Slow US inflation retreat set to bolster Fed patience on US rate cuts. Inflation in the US probably abated only gradually last month and retail sales rebounded, illustrating why the Fed is in no rush to lower interest rates. The core consumer price index, a measure that excludes food and fuel for a better picture of underlying inflation, is seen rising 0.3% in February from a month earlier after a 0.4% advance to start the year. The price gauge is projected to have risen 3.7% from a year ago, which would mark the smallest annual advance since April 2021. (Bloomberg)

US: Job growth exceeds estimates in Feb but previous months downwardly revised. Employment in the US increased by much more than expected in the month of Feb, according to a report released by the Labor Department, although the report also showed notable downward revisions to job growth in the two previous months. The Labor Department said non-farm payroll employment surged by 275,000 jobs in Feb, while economists had expected employment to jump by 200,000 jobs. (RTT)

EU: GDP remains stable as estimated. The euro area economy stagnated at the end of 2023, as initially estimated, and avoided a technical recession. GDP flat-lined sequentially, following a 0.1% fall in the third quarter, revised data from Eurostat showed. The fourth quarter's rate matched the estimate published on Feb 14. Confirming the annual growth, the statistical office said the currency bloc grew 0.1%, the same pace of growth as seen in the preceding period. On the expenditure-side, household spending grew 0.1%, which was weaker than the 0.3% rise a quarter ago. Government expenditure registered a steady growth of 0.6%. At the same time, gross fixed capital formation climbed at a faster pace of 1.0% after remaining flat. Exports were unchanged, while imports advanced 0.6%. (RTT)

China: It will improve home sales in 'forceful', 'orderly' way. China will improve home sales in a "forceful" and "orderly" way, Minister of Housing and Urban-Rural Development Ni Hong said, as weak demand in the country's beleaguered residential property market persists. The property sector has lurched from one crisis to another since 2021 after a regulatory crackdown on high leverage among developers triggered a liquidity crisis among real estate firms and crushed home-buying sentiment. Chinese developers including real estate giants China Evergrande Group and Country Garden have defaulted on their debts, many housing projects across China have been left unfinished, and angry buyers who have already paid for their homes have clamoured for official action. Some developers should be allowed to go bankrupt or restructured according to legal and market-based rules, Ni said told a press conference on the sidelines of the annual meeting of parliament in Beijing. (Reuters)

China: Consumer prices swing up on seasonal Lunar New Year gains. China's consumer prices rose for the first time in six months due to spending linked to the Lunar New Year, offering some reprieve for the world's second-biggest economy grappling with weak consumer sentiment, while factory-gate prices fell again. The consumer price index (CPI) climbed 0.7% YoY in Feb, data from the National Bureau of Statistics (NBS) showed, beating the 0.3% gain forecast by economists in a Reuters poll. The YoY growth in consumer prices was also the highest in 11 months, buoyed by gains in some key foodstuffs such as pork and fresh vegetables, as well as travel amid a seasonal rush around Lunar New Year in Feb, according to the NBS data. The bounce into positive territory contrasted with the 0.8% fall in Jan, the steepest drop in over 14 years, due to a higher statistical base in January 2023 as the Lunar New Year arrived earlier that month and boosted spending. (Reuters)

Taiwan: Trade surplus grows in Feb. Taiwan's foreign trade surplus increased notably in Feb from a year ago as exports rose amid a sharp fall in imports, preliminary figures from the Ministry of Finance revealed. The trade surplus climbed to USD7.88bn in Feb from USD2.39bn in the corresponding month last year. The surplus also grew from USD2.49bn in Dec. Exports rose 1.3% YoY in Feb, following an 18.1% surge in Dec. That was slightly faster than the 1.1% rise economists had forecast. Shipments of information, communication, and audio-video products showed a massive growth of 104.6% annually in Feb, while those of plastic and rubber and related articles dropped by 22.6%. (RTT)

Markets

Scientex: To buy land in Kuala Selangor for RM336m to build mixed-use development. Plastic products manufacturer Scientex is set to acquire land in Batang Berjuntai, Kuala Selangor, for a total of RM335.68m to enhance its property development land bank. The group also proposed to build a mixed-use development on the acquired land. Scientex disclosed that its wholly owned subsidiary Scientex Park (M) SB has entered into a conditional sale and purchase agreement with Metalplex Plantation SB for the proposed acquisition of a parcel of freehold land measuring 826 acres. (The Edge)

Barakah Offshore: Seeking shareholders’ upfront approval to sell Kota Laksamana 101 barge within six months. Barakah Offshore Petroleum is seeking upfront approval from shareholders to sell its Kota Laksamana 101 (KL101) barge at a minimum USD11.4m (RM54.18m) cash, to a third-party purchaser to be identified later. The group’s circular to shareholders is asking for a mandate for it to dispose of the barge within a six-month timeframe. (The Edge)

Yinson: Announces issuance of RM640m sukuk. Yinson Holdings has successfully issued a Perpetual Sukuk Wakalah worth RM640.0m in nominal value pursuant to its Perpetual Sukuk Wakalah Programme. The Perpetual Sukuk Wakalah is rated A3 by RAM Rating Services and A-IS by MARC Ratings. The proceeds raised from the issuance of the Perpetual Sukuk Wakalah shall be utilised for Yinson and/or its group of companies’ Shariahcompliant purposes, comprising capital expenditures, refinancing of existing financing or borrowings or future financing and working capital. (StarBiz)

Perdana Petroleum: Secures vessel charter contracts from Dayang Enterprise. Perdana Petroleum announced that its wholly-owned subsidiary Perdana Nautika SB has accepted letters of award from Dayang Enterprise SB (DESB) to charter one unit of anchor handling tug and supply (AHTS) vessel and one unit of accommodation work barge (AWB) worth RM13.4m. The estimated value of these charters (without the extension period), is RM4m for the AHTS vessel and RM9.4m for the AWB unit. (The Edge)

Samaiden: Inks 20-year solar energy PPA with Maxell Tohshin. Samaiden Group has struck a strategic power purchase agreement (PPA) with Maxell Tohshin (Malaysia) SB to install a 1,028.28- kilowatt peak (kWp) advanced solar photovoltaic (PV) system at the latter company's premises. The intiative, set for a duration of 20 years, is expected to significantly curtail carbon emissions from manufacturing operations, projecting an estimated carbon dioxide (CO2) avoidance of 974.66 tonnes per year. (StarBiz)

Pharmaniaga: COO Mohamed Iqbal Abdul Rahman retires after 13 years. Mohamed Iqbal Abdul Rahman has retired as Pharmaniaga chief operating officer (COO) effective immediately, ending his 13-year tenure with the company. The pharmaceutical outfit said that Iqbal joined in 2011 as director of information technology before being promoted to COO in 2012. With over 32 years of experience in system improvement and operations management, Iqbal led initiatives such as implementation of business intelligence system and robotic process automation. He played a crucial role in implementing the Pharmacy Information System (PhIS) in over 1,200 MOH facilities. (The Edge)

MARKET UPDATE

The FBM KLCI might open lower today after investors stretched record-breaking stock rallies yesterday, before Wall Street took profits, while US Treasury yields dipped after not-too-hot, not-toocold US jobs data reinforced the conviction that the Federal Reserve will begin easing by mid-year. Two US stock indices advanced into uncharted territory after the Labour Department said US job growth accelerated in February, even as the unemployment rate jumped and wage gains moderated. The mixed report kept on the table an anticipated interest rate cut in June by the Fed. But the S&P 500 and the Nasdaq reversed course while the Dow Jones Industrial Average did not reach a record high. The Dow fell 68.66 points, or 0.18%, to close at 38,722.69, the S&P 500 lost 33.67 points, or 0.65%, to close at 5,123.69 and the Nasdaq Composite lost 188.26 points, or 1.16%, to close at 16,085.11. In Europe, the STOXX index of 600 companies hit a new lifetime high, ending just 0.02% higher, while Europe’s broad FTSEuroFirst 300 index slipped 0.03%.

Back home, Bursa Malaysia closed marginally higher on Friday in line with the positive tone from the regional markets, ahead of the US Nonfarm Payrolls data announcement later on Friday night. At the closing bell, the FBM KLCI added 4.03 points to 1,539.86 from Thursday's close of 1,535.83. MSCI’s broadest index of AsiaPacific shares outside Japan went up 1.01%, while Japan’s Nikkei rose 90.23 points, or 0.23%.

Source: PublicInvest Research - 11 Mar 2024