• Malaysia Climbs 5 Spots in Global Attractiveness Index for Investment. Malaysia rose five spots in this year’s Baseline Profitability Index (BPI),a ranking of destinations of attractiveness in the world for foreign investors published by the Foreign Policy magazine. Malaysia climbed to 6th out of a total 110 countries from 11th placing in 2014. In a statement today, Malaysia Investment Development Authority said the ranking reaffirmed that Malaysia is an attractive profit centre in this region for investors. Among ASEAN countries, only Malaysia and Singapore featured in the top 10. Indonesia was ranked 12th, Vietnam 23rd, the Philippines 30th and Thailand at the 38th position. (The Edge Markets)
• Rubber Output Down 11.3% in May. Malaysia's national rubber (NR) production in May 2015 dropped 11.3% to 38,923 tonnes compared with the same period last year, the Statistics Department said.Month-on-month, however, saw an increased in rubber production by 8.6%.The department, in a statement today, said the smallholding sector contributed 91.2 per cent to the total production, while the remaining from the estate sector. The commodity was mainly exported to China (36.2%) followed by Germany (16.3%), the US (5.7%) and Iran (4.3%). (Bernama)

• China’s Exports Rise in Another Sign of Stabilizing Economy. China’s exports rose for the first time in four months in June, providing fresh evidence that growth is stabilizing ahead of gross domestic product data this week. Overseas shipments rose 2.1% from a year earlier in yuan value, the customs administration said in Beijing on Monday, exceeding the median estimate for 1.2% growth. Exports also beat expectations in dollar denominated terms, rising 2.8% in the same period. Imports dropped 6.7%, narrowing from the fall of 18.1% previously reported in May, leaving a trade surplus of 284.2 billion yuan ($45.8 billion). (Bloomberg)
• India’s CPI Exceeds Estimates, Reducing Room for Rate Cuts. India’s inflation accelerated more than estimated, decreasing room for central bank Governor Raghuram Rajan to cut interest rates again to boost investment. Consumer prices rose 5.4% in June from a year earlier after a 5.01% increase in May, the Statistics Ministry said in a statement on Monday. The median of 35 estimates in a survey of economists had predicted a 5.1% gain. The Reserve Bank of India will continue to look at whether monsoon rainfall is enough to keep crop prices in check, Rajan said on July 2. The nation gets more than 70% of its annual rainfall from June to September. (Bloomberg)
• Australian Regulator Recommends Banks Lift Capital Ratios. Australia's major banks should increase their capital ratios by at least 200 basis points to put them on par with international peers, the financial regulator said on Monday, quantifying its recommended level of increase for the first time. Capital ratios at Australia's major banks - Commonwealth Bank of Australia, Westpac Banking Corp, ANZ Banking Group and National Australia Bank - stand at 11.7%, the study found. By comparison, the tier-I capital ratio for U.S. banks stand at 12.7%. The banks would together need between A$22 billion and A$41 billion to move to the top quartile, according to estimates from five analysts. (Reuters)
• Thai Government to Buy Palm Oil from Domestic Producers. Thailand will buy 100,000 tonnes of crude palm oil from domestic producers between June and November using a government fund of 2.9 billion baht ($85.2 million), a senior government official said on Monday. Thailand is the world's third-largest palm oil producer, although its output is a fraction of that of top producers Indonesia and Malaysia. The government purchases aim to keep the domestic price of palm oil competitive and relieve oversupply, Lersak Rewtarkulpaiboon, a secretary general at the country's Office of Agricultural Economics told reporters. (Reuters)
• China Money Rate at 2.5% for Fifth Day Points to Central Bank’s Target. China’s benchmark money-market rate opened at 2.5% for the fifth day in a row, a sign that’s where the central bank wants it anchored as stocks swing violently. The seven-day repurchase rate, a gauge of funding availability in the financial system, was 2.53% as of 11:40 a.m. in Shanghai, a weighted average shows. Its five basis point trading range for the past week compares with 43 in the June 30-July 6 period. (Bloomberg)

• U.S. Posts Budget Surplus of $51.8 billion in June. The United States posted a budget surplus of $51.8 billion in June, down 27% from the same period last year, the U.S. Treasury Department said on Monday. Analysts had expected a $51 billion surplus last month. The government had a surplus of $70.5 billion in June 2014, according to Treasury's monthly budget statement. The current fiscal year-to-date deficit stood at $313.4 billion at the end of last month compared with $365.9 billion for the same period during the prior fiscal year. Receipts last month totaled $342.9 billion, while outlays stood at $291.2 billion. (Reuters)
• U.S. Companies Expected to Report Worst Sales Fall in Nearly Six Years. U.S. companies are expected to report their worst sales decline in nearly six years when they post second-quarter results, giving investors reason to worry about future profits. This reporting period is expected to mark the 16th quarter in which sales performance has lagged that of earnings for S&P 500 companies. Second-quarter S&P 500 revenue is expected to have fallen 3.9% from a year ago, marking the steepest decline since the third quarter of 2009. Second-quarter earnings are expected to have fallen 2.9%. (Reuters)

Source: Kenanga Research - 14 Jul 2015