HEADLINES

Economy

US: No day-one tariffs from Trump, but he says Canada, Mexico may get duties Feb 1. President Donald Trump did not immediately impose tariffs on Monday as previously promised but said he was thinking about imposing 25% duties on imports from Canada and Mexico on 1 Feb over illegal immigrants and fentanyl crossing into the US. As he was sworn into office, Trump stopped well short of a swift tariff action against the two US neighbors, but directed federal agencies to investigate persistent US trade deficits and unfair trade practices and alleged currency manipulation by other countries. In a presidential memo, Trump directed the Commerce and Treasury departments and the US Trade Representative to probe the economic and national security risks of large trade deficits "and recommend appropriate measures, such as a global supplemental tariff, or other policies, to remedy such deficits." (Reuters)

EU: German investor morale falls more than expected in Jan, survey finds. German investor morale fell more than expected in January, the ZEW economic research institute said, after the German economy contracted for the second consecutive year. The institute's economic sentiment index fell to 10.3 points from 15.7 points in Dec, well below the 15.3 forecast by analysts. "A lack of private household spending and subdued demand in the construction sector continue to stall the German economy," ZEW president Achim Wambach said. "If these trends continue in the current year, Germany will fall further behind the other countries of the euro zone." Germany has gone from being Europe's economic powerhouse to underperforming its peers, and is expected to be the only major economy to have contracted last year. (Reuters)

EU: German exporters expect 2.7% drop in sales in 'bleak' 2025. About 80% of German businesses who trade overseas expect a further decline in sales this year, Germany's BGA trade association said on Tuesday, forecasting a 2.7% decline in turnover compared with 2024. "The outlook for 2025 is bleak," said BGA president Dirk Jandura. "Small and medium enterprises have lost their trust in politics." Another risk for the German economy is the tariffs promised by US President Donald Trump, measures he says would boost US manufacturing. Jandura said Germany and the EU will have to wait to see what steps Trump takes. "I advise no panic, evaluate calmly and build up a reasonable, strong counterposition." He added that Trump is a "pragmatic" person, who knows that if tariffs were to come, there would be losses of prosperity in the U.S. within a few months, because imports would become dramatically more expensive. (Reuters)

China: Economy meets official growth target, but many feel worse off. China's economy grew 5% last year, matching the government's target, but in a lopsided fashion, with many people complaining of worsening living standards as Beijing struggles to transfer its industrial and export gains to consumers. The imbalance raises concerns that structural problems may deepen in 2025, when China plans a similar growth performance by going deeper into debt to counter the impact of expected US tariff hikes. Dec data showed industrial output far outpacing retail sales, and the unemployment rate ticking higher, highlighting the supply-side strength of an economy running a trillion-dollar trade surplus, but also its domestic weakness. Export-led growth has been partly underpinned by factory gate deflation which makes Chinese goods more competitive on global markets, but also exposes Beijing to greater conflicts as trade gaps with other countries widen. Within borders, falling prices have ripped into corporate profits and workers' incomes. (Reuters)

South Korea: Economy barely grew in Q4, BOK to cut rates in February: Reuters poll. The South Korean economy barely grew last quarter as political chaos weighed on consumer spending, according to a Reuters poll of economists who expect the Bank of Korea to cut interest rates next month following a surprise hold last week. Asia's fourth-largest economy grappled with uncertainty from President Yoon Suk Yeol's brief 3 Dec martial law attempt, weakening economic sentiment and sluggish domestic demand which overshadowed the recovery in exports. After only growing 0.1% in the July-Sept quarter, South Korea's economy likely expanded a seasonally adjusted 0.2% in Q4, according to the median forecast of 24 economists. On an annual basis, the economy expanded 1.4% last quarter, according to the median forecast of 25 economists polled 15-20 Jan, barely changed from 1.5% in the previous quarter. (Reuters)

Taiwan: Dec export orders jump, Trump clouds outlook. Taiwan's export orders grew at their fastest pace in nearly three years last month boosted by demand for artificial intelligence technologies, and China, though tariff threats from the new administration of Donald Trump cloud the outlook. Export orders rose 20.8% YoY in Dec to USD52.92bn, Taiwan's economy ministry said. That beat the 16.05% increase forecast in a Reuters poll and Nov's expansion of 3.3%, and was the strongest growth since 2022 Feb. It was also the 10th monthly gain in a row. Orders for goods from Taiwan, home to tech giants such as chip manufacturer TSMC (2330.TW), opens new tab, are a bellwether of global technology demand. (Reuters)

Markets

CIMB (Trading Buy: TP: RM8.64). CIMB Thai's FY2024 net profit surges 78%, boosted by investment gains, higher fees income and lower credit losses. CIMB Group Holdings Bhd's (KL:CIMB) 94.83%-owned CIMB Thai Bank PCL saw its net profit surge 77.7% to 2.85 billion baht (RM374.5 million) for the financial year ended Dec 31, 2024 (FY2024), up from 1.61 billion baht a year earlier, thanks to higher operating income and lower expected credit losses. The bank's consolidated operating income increased 9.7% to 15.1 billion baht from 13.77 billion baht, attributed to a 49.4% rise in its other operating income, as well as 19.9% increase in net fees and service income. (The Edge)

MRCB: Wins bid for Ipoh Sentral, say sources. Malaysian Resources Corp is said to have won the bid for the Ipoh Railway Station Integrated Development Plan (iRide) project, which will be inked on Jan 23 in Ipoh, Perak, according to sources. There were two consortiums shortlisted by the Railway Assets Corporation (RAC) to develop iRide, Transport Minister Anthony Loke was reported saying in Sept. The iRide project, which is based on the transit-oriented development (TOD) concept, will see the development of almost 70 acres of RAC land behind Ipoh Railway Station, which will be rebranded as Ipoh Sentral. (The Edge)

Pansar: Bags RM478m highway construction job in Sarawak. Pansar secured a RM477.7m contract to design and build the Serian-Gedong-Samarahan dual carriageway highway from the Sarawak Public Works Department. The scope of work includes the development of an 8.5km of a new four-lane dual carriageway, including two bridges, an autonomous rail transit reserve, bicycle tracks, utility corridors, road lighting, road furniture, and signage. The project is slated to commence in February 2025 and will take 36 months to complete. (The Edge)

Mah Sing: Unit acquires Sentul land. Mah Sing Group's wholly- owned subsidiary Klassik Tropika Development SB has inked a deal with several vendors for the proposed acquisition of 2.78 acres of freehold prime land in Sentul, Kuala Lumpur for RM32m. The property developer said the land is slated for an apartment project named M Aria with an estimated GDV of RM283m. "The development is aimed at a diverse range of buyers, including first-time homeowners, working adults, families, homebuyers looking for an upgrade and investors. (StarBiz)

YNH: To sell AEON Mall Seri Manjung to Sunway REIT for RM138m. YNH Property is disposing of a two-storey shopping centre, AEON Mall Seri Manjung in Perak, to Sunway REIT for RM138m. The property is 100% leased to supermarket chain operator AEON Co (M), whose lease will last another 13 years until Dec 3, 2037. The sale is expected to be completed within six months. YNH Property expects to book a pro forma net gain of RM12.0m from the sale. (The Edge)

Taghill: Bags RM58m commercial complex construction job. Taghill Holdings said it has secured a RM58m contract for construction work on an 18-storey commercial complex in Ipoh. The contract, awarded by One Roof Development SB, will span 16 months from March 1, 2025, with a target completion date of June 30, 2026. The 18-storey commercial complex comprises 271 hotel rooms, offices, restaurants, cafes, function rooms, banquet halls and swimming pools. (The Edge)

MARKET UPDATE

US markets finished higher overnight as President Donald Trump struck a better-than-feared tone on global trade and speculation grew that his policies will further boost the country. Dow Jones surged 1.2% and S&P 500 gained 0.9%. Nasdaq rose 0.6% to 19,756. European stocks ended the day higher as investors digested the first executive orders signed by newly inaugurated President Donald Trump. German DAX ended up 0.2% and the UK's FTSE 100 rose 0.3%. French CAC advanced 0.5% to finish at 7,770.95. Meanwhile, Asian markets received a boost after US President Donald Trump did not impose a steep tariff on China in his first day in office, as feared. Nikkei 225 added 0.3% to 39,027. Hang Seng Index gained 0.9% while Shanghai Composite Index ended marginally lower at 3,242.

Source: PublicInvest Research - 22 Jan 2025