Economy

US: Yellen says US prepared to take more action to keep bank deposits safe. US Treasury Secretary Janet Yellen reiterated that she was prepared to take further action to ensure that Americans' bank deposits stay safe amid turmoil in the banking system. "As I have said, we have used important tools to act quickly to prevent contagion," Yellen said in remarks to the US House of Representatives Appropriations subcommittee hearing. (Reuters)

US: Yields tumble after Fed's dovish hike amid talk of a pause. US Treasury yields dropped, a day after the Federal Reserve hiked rates by 25 basis points but indicated that it is on the verge of pausing further increases after the recent collapse of two US banks. Fed Chair Jerome Powell sought to reassure investors about the soundness of the banking system, saying that the management of Silicon Valley Bank "failed badly," but that the bank's collapse did not indicate wider weakness in the banking system. Powell said that officials were still intent on fighting inflation while also eying the extent to which recent bank failures had cooled demand and slowed lending. (Reuters)

US: Labour market still tight, housing market close to bottoming out. The number of Americans filing new claims for unemployment benefits edged down last week, showing no signs yet that the recent financial market turbulence following the failure of two regional banks was having an impact on the economy. The unexpected dip in claims reported by the Labour Department suggested March could be another month of solid job growth. The weekly unemployment claims report is the most timely data on the economy's health. (Reuters)

US: Yellen - Inflation likely to come down on lower supply chain pressures, shipping costs. US Treasury Secretary Janet Yellen said that supply chain pressures and shipping costs were coming down and were eventually likely to bring down inflation. She also said a debt default would undermine the US dollar’s reserve currency status and that a failure to raise the debt ceiling would lead to a recession or worse. Yellen made the remarks in a US House of Representatives Appropriations subcommittee hearing. (Reuters)

EU: Denmark consumer confidence rises to -23.1. Danish consumers' pessimism eased somewhat in March, as the confidence indicator rose further to its highest level in ten months. The consumer confidence index rose to -23.1 in March from -25.1 in Feb. The slight improvement in March was primarily due to significant progress in consumers' assessment of Denmark's past and future economic conditions, the agency said. The index measuring consumers' views towards the general economic situation of the country in the next twelve months improved notably to -0.7 in March from -6.4 in Feb, and their own financial situation in the future rose from -0.3 to +0.4. (RTT)

UK: Bank of England raises rates, says inflation set to fade. The Bank of England (BoE) raised interest rates for the 11th time in a row, but said a surprise resurgence in inflation would probably fade fast, prompting speculation it had ended its run of hikes. Sounding more upbeat about the outlook for Britain's sluggish economy but noting the risks posed by turmoil among global banks, the BoE's nine rate-setters voted 7-2 in favour of a 25 basis-point increase in Bank Rate to 4.25%, as expected by economists polled by Reuters. (Reuters)

Hong Kong: Inflation eases to 1.7%, lowest in 9 months. Hong Kong's consumer price inflation eased in Feb to the lowest level in nine months, largely due to a slowdown in food prices, data released by the Census and Statistics Department showed. The CPI climbed 1.7% YoY in Feb, slower than previous month's 4- month high of 2.4% rise. Further, this was the weakest inflation since May 2022, when prices had risen 1.2%. Food price inflation moderated to 2.4% in Feb from 5.0% in Jan. (RTT)

Australia: Manufacturing sector falls into contraction - Judo Bank. The manufacturing sector in Australia slipped into contraction territory in March, the preliminary survey from Judo Bank revealed manufacturing PMI score of 48.7. That's down from 50.5 in Feb, and it slips beneath the boom-or-bust line of 50 that separates expansion from contraction. Manufacturing output shrank for a fourth straight month on the back of falling new orders. The rate at which new orders contracted was the fastest since Aug 2021. Anecdotal evidence suggested that higher interest rates and inflationary pressures affected client interest at the end of the first quarter. (RTT)

Taiwan: Central bank raises key rate further, cuts growth forecast. Taiwan's central bank raised its key interest rate by a surprise move at its Dec meeting amid concerns about inflation as policymakers aim to achieve price stability and support sound economic and financial development. The central bank board unanimously decided to raise the benchmark discount rate by 0.125 percentage points to 1.875%. The discount rate was lifted for the fifth straight time. The previous change in the rate was also the same 0.125 percentage points in Dec. (RTT)

Singapore: Inflation eases to 6.1%, lowest in 9 months. Singapore's consumer price inflation moderated in Feb to the lowest level in nine months amid a slowdown in private transport charges, data published by the Monetary Authority of Singapore and the Ministry of Trade and Industry showed. The CPI climbed 6.3% YoY in Feb, slower than the 6.6% increase in the previous month. (RTT)

Philippine: Central Bank hikes rate for ninth straight session. The Philippine central bank raised its benchmark rates for the ninth consecutive policy session to gain control over inflationary pressure emanating from strong domestic demand and lingering supply-side constraints. That said, the bank softened its pace of tightening given the stability in the currency. The Monetary Board of the Bangko Sentral ng Pilipinas, led by Governor Felipe Medalla, lifted the interest rate on the overnight reverse repurchase facility by 50 basis points to 6.50%. The interest rates on the overnight deposit and lending facilities were raised to 5.75% and 6.75%. (RTT)

Markets

Tenaga National (Outperform, TP: RM12.42): Abdul Razak Abdul Majid is TNB's new chairman. Tenaga Nasional (TNB) has appointed Datuk Abdul Razak Abdul Majid as its chairman effective from 27 March. Abdul Razak, who has 36 years of experience with the group, is replacing Datuk Seri Hasan Arifin who stepped down from the position early this year. Abdul Razak had direct interest of 26,562 shares in the company. He currently holds a directorship at Petronas Gas. (New Straits Times)

SunCon: Wins RM604.9m RTS Link Project. Sunway Construction Group (SunCon) has secured a RM604.9m contract from Malaysia Rapid Transit System SB. Its wholly owned subsidiary Sunway Construction SB (SCSB) signed the letter of acceptance from Malaysia Rapid Transit. (StarBiz)

Chin Hin Group Property: Emerges as major shareholder of NCT after share subscription. Chin Hin Group Property has emerged as a substantial shareholder of NCT Alliance, after subscribing to 75.41m shares in the latter via private placement. The shares amount to 5.61% of the voting shares in NCT upon completion of the share placement. The property developer paid 32 sen per share, which amounts to RM24.13m, from internally generated funds for its stake in NCT, which is also involved in real estate development and construction activities. (The Edge)

Wellspire: Distribute China’s Weilong snacks in Thailand. Wellspire Holdings announced that its subsidiary, Bai Li Enterprise, has entered into a distribution agreement with HH International Enterprise Limited acting as the exclusive distributor for Weilong products in Thailand. Under the agreement, Wellspire will distribute the Weilong brand konjac and seasoned flour products, namely the Weilong Big Hot Stick (Latiao) and Weilong Konjac Shuang. (Business Times)

Straits Energy: Associate CBL International to be listed on Nasdaq. Oil trading and bunkering service provider Straits Energy Resources’ 38% associate CBL International Ltd has been granted in-principle approval to list on the Nasdaq Capital Market. Nasdaq had vide email dated 20 March approved in-principle the listing and registration of CBL International's shares on the Nasdaq stock market. (The Edge)

Green Packet: Second largest individual shareholder Leong Seng Wui exits group. Green Packet saw its second largest individual shareholder Leong Seng Wui disposing of all his shares in the group on 20 and 21 March. On 23 March, Leong, who is also the group’s executive director, had ceased being its substantial shareholder after he disposed of all of his shares early this week. Prior to the disposal, Leong owned 124.34m shares, or 8.91% of the issued shares of Green Packet, which he acquired back in 31 Jan 2022. (The Edge)

Ta Win: Unit raises shareholding in wire firm to 66% via purchase of Asia Poly's 15% stake. Cyprium Capital SB, is acquiring Asia Poly Holdings' 15% stake in Cyprium Wire Technology SB (CWT) for RM12m. CWT is involved in the manufacturing of wire and cable products. Asia Poly said it had acquired the 15% stake in May 2021 for investment purposes, and the stake's disposal now serves as a viable opportunity for the company to realise its investment in CWT. (The Edge)

Market Update

The FBM KLCI might open higher today after US equities rose on Thursday as investors digested a spate of central bank interest rate rises that have come in spite of recent turbulence in the banking sector. The blue-chip S&P 500 rose 0.3%, led higher by tech stocks, while the tech-heavy Nasdaq Composite gained 1%. Trading in both indices were choppy on Thursday, alternating between small losses and gains. Late on Wednesday the US Federal Reserve proceeded with the 0.25 percentage point interest rate increase markets expected, but signalled that its monetary tightening cycle may be nearing the end. Tech is typically an industry that is heavily dependent on borrowing, so tech stocks are sensitive to interest rates. On Thursday, the Bank of England raised its benchmark interest rate by 0.25 percentage points, also anticipated by markets. The Swiss National Bank and Norway’s central bank also increased interest rates on Thursday. European equities were mixed: The region-wide Stoxx 600 closed down 0.2% and London’s FTSE 100 lost 0.9%. However, Germany’s Dax was flat and the CAC 40 in Paris finished 0.1 % higher.

Back home, Bursa Malaysia pared most of its earlier losses to close marginally lower by 0.08% on Thursday, weighed by financial services stocks amid weak market sentiment. At the closing bell, the benchmark FBM KLCI had fallen 1.06 points to 1,410.98, which was the day’s high, from Wednesday's close at 1,412.04. Regionally, Hong Kong's Hang Seng Index advanced 2.34% to 20,049.64, Japan's Nikkei 225 declined 0.17% to 27,419.61, while China’s SSE Composite Index rose 0.64% to 3,286.65.

Source: PublicInvest Research - 24 Mar 2023