HEADLINES

Economy

US: Fed’s Beige Book shows little growth across most of US. Economic activity was flat in most parts of the US since early Sept, the Fed said in its Beige Book survey of regional business contacts. More than half of the US central bank’s 12 districts reported “slight or modest” growth in employment, while most districts said prices rose at a “slight or modest pace,” according to the report published in Washington. (Bloomberg)

US: Weekly jobless claims unexpectedly see further downside. After reporting an unexpected pullback by first-time claims for US unemployment benefits in the previous week, the Labour Department released a report showing initial jobless claims saw further downside in the week ended Oct 19. The report said initial jobless claims fell to 227,000, a decrease of 15,000 from the previous week's revised level of 242,000. Economists had expected jobless claims to inch up to 242,000 from the 241,000 originally reported for the previous week. Jobless claims continued to give back ground after reaching their highest level in over a year in the week ended Oct 5. (RTT)

EU: French manufacturing sentiment deteriorates in Oct. France's manufacturing confidence weakened sharply in Oct, survey data from the statistical office INSEE showed. The business climate index fell to 92 in Oct from 99 in Sept. The score deviated sharply from its long-term average of 100. Moreover, excluding the COVID-19 pandemic period, this was the biggest monthly fall since Nov 2008. The balance of opinion on personal production expectations decreased sharply to -3 from +6 in the previous month. However, the one relative to general production prospects in the industry dropped only slightly to -12 from -11. The balances of opinion associated with the level of order books, both overall and foreign, deteriorated and fell below their respective averages. (RTT)

Japan: Factory activity dips for 4th straight month, PMI shows. Japan's factory activity contracted for the fourth straight month in Oct on subdued demand and weak orders, a private-sector survey showed. The au Jibun Bank flash Japan manufacturing PMI declined to 49.0 in Oct from 49.7 in Sept. The index stayed below the 50.0 threshold separating growth from contraction for a fourth straight month. "New orders decreased across manufacturing and services," said Usamah Bhatti, economist at S&P Global Market Intelligence. "Poor demand conditions were not limited to just the domestic economy as new orders from abroad fell at the quickest pace since Feb 2023. (Reuters)

South Korea: Economy barely grows in 3Q as exports slip. South Korea's economy barely grew in the 3Q as consumer spending showed signs of recovery, but exports declined, raising the chances for more stimulus to support growth. That prompted the central bank to warn of a potential downgrade to its 2024 growth forecast, while the finance minister called for response measures to confront the slowdown. GDP in the July-Sept quarter expanded a seasonally adjusted 0.1% from a quarter earlier, the BOK’s advance estimates showed, lower than market expectations. The weak growth is a setback for Asia's fourth-largest economy and could exert pressure on the KRW, which has weakened nearly 5% against the USD this month, as the central bank's full-year estimate had already been lowered. (Reuters)

India: Business activity grows at faster clip in Oct, PMI shows. Growth in India's business activity picked up slightly in Oct after softening last month, led by stronger demand in the manufacturing sector, according to a survey that also showed job creation rose at the fastest pace since Feb 2006. HSBC's flash India Composite PMI, opens new tab, compiled by S&P Global, rose to 58.6 this month from Sept's final reading of 58.3, which was a 10-month low. The headline index has been above the 50-level separating growth from contraction for 39 consecutive months - the longest expansionary streak since June 2013. (Reuters)

Markets

AWC: Bags RM9.4m job for immigration complex in Sungai Melaka. Engineering services provider AWC has bagged a RM9.4m contract from the Melaka Public Works Department (JKRM) to provide facilities management and maintenance service for the immigration, custom, quarantine and security complex in Sungai Melaka. Its wholly owned subsidiary Ambang Wira Facilities SB has received an LoA from JKRM for the proposed job. The contract is for 60 months, commencing from 1 Nov 2024 to 31 Oct 2029. (The Edge)

Perak Transit: Wins contract for KB Sentral Terminal development. Perak Transit has been awarded the contract for the development of the Kota Bharu Sentral terminal project by the Kelantan State Government. Under the agreement, PTrans will oversee the construction of the new terminal and has appointed China Communications Construction Company (CCCC) as the main contractor for the project. Further details and conditions of the project will be communicated to PTrans by the state authority in the near future. (The Malaysian Reserve)

EMCC: To raise funds for loan repayment. Evergreen Max Cash Capital (EMCC) is proposing to undertake a private placement of up to 10% of its total number of issued shares as well an employees’ share option scheme, involving up to 10% of the total number of issued shares in the company. As of 23 Oct, the company has a total issued share capital of RM150,959,620 comprising 1,114,902,499 shares. Accordingly, the proposed private placement will entail the issuance of up to 111,490,249 new shares. (StarBiz)

Texchem: Founder’s son takes over the helm. Texchem Resources, a five-decade old conglomerate which operates Malaysia’s largest halal Japanese chain of restaurants, officially inaugurated Yuma Konishi as its new president/CEO. Yuma is the son of Tan Sri Fumihiko Konishi, the executive chairman and founder of Texchem. Yuma is ‘set to modernise and rejuvenate the organization’. Joining the Penang-based group in 2005, Yuma has more than 19 years of experience in the plastics industry and almost a decade spearheading Texchem’s venture into the medical life sciences industry. (The Malaysian Reserve)

Nestle: Records turnover of RM4.8bn in 9M24. Nestle (M) Bhd has reported a turnover of RM4.8bn for 9M24, representing a decline of 11.4% compared with the same corresponding period last year. The group said exports continued to show strong dynamism while local sales were impacted by consumer hesitancy amid cautious spending and affordability concerns. “Beyond the current headwinds, Nestle Malaysia reiterates its confidence in returning to healthy growth latest by end of 1H25, on the base of the company’s solid fundamentals and signs of progressive improvement in overall consumer confidence,” it said. (StarBiz)

DXN: Higher shipping costs, forex loss drags 2Q net profit down 13%. DXN Holdings reported a 13.2% drop in net profit for 2QFY2025 to RM66m, from RM76m a year ago, hurt by foreign exchange losses, as well as higher employee benefit costs and shipping costs. For the quarter under review, the health and wellness direct selling company, which was listed in May 2023, posted a record high in quarterly revenue of RM488.4m. This marked a 6.6% increase, compared with RM458.3m in revenue reported last year. (The Edge)

MARKET UPDATE

The FBM KLCI might open flat today after Wall Street drifted to a mixed finish Thursday after Tesla surged to one of the best days in its history, while IBM slumped to its worst in six months. The S&P 500 rose 0.2% to break its first three-day losing streak since early September. It bounced between losses and gains through the day, and it was roughly evenly split between stocks rising and falling. The Dow Jones Industrial Average fell 140 points, or 0.3%, while the Nasdaq composite rose 0.8%. Tesla led the market with a jump of 21.9% after the electric-vehicle maker reported better profit for the latest quarter than analysts expected. An optimistic CEO Elon Musk also predicted 20% to 30% sales growth next year, though its revenue for the latest quarter fell short of analysts’ forecasts. It was the best day for Tesla’s stock since 2013. A report on unemployment claims Thursday offered a mixed picture on the job market. It said fewer workers applied for unemployment benefits last week, which can be a signal of relatively low layoffs. But it also said the total number of those collecting benefits rose to its highest level in almost three years. A separate preliminary report said growth in US business activity may have accelerated slightly last month, as strength for companies in services industries continue to make up for weakness in manufacturing. The report from S&P Global also showed a recovery in confidence as companies anticipate greater stability and certainty after the upcoming presidential election. A third report, meanwhile, said sales of new homes were stronger last month than economists expected. In stock markets elsewhere, indices were modestly higher in Europe after finishing mixed in Asia. Back home, the FBM KLCI lost 9.30 points or 0.57% to end at 1632.23. .23 yesterday. Market breadth turned negative again as decliners trounced ipated to trend sideways around the 1636 horizon at best in the near term. further should the key support level of 1622 be bearishly broken. Support stance levels stand at 1636, 1652 and 1664.

Source: PublicInvest Research - 25 Oct 2024