HEADLINES

Economy

EU: German business sentiment rises, giving rare boost to ailing economy. German business morale improved more than expected in Oct, a survey showed, offering hope for some respite towards the end of the year in the economy's grinding battle with industrial woes and weak global demand. The Ifo institute said its business climate index increased to 86.5 in Oct from 85.4 the previous month. Analysts polled by Reuters had forecast a reading of 85.6. (Reuters)

Japan: Tokyo inflation slows below 2% ahead of Japan's election, central bank meet. Inflation in Tokyo slowed below 2% for the first time in five months largely due to energy prices, as the country heads into a general election and the BOJ mulls data for its policy decision next week. Consumer prices excluding fresh food rose 1.8% in the capital in Oct, marking the second month of deceleration, the Ministry of Internal Affairs reported. The reading slightly exceeded economists’ estimates of 1.7%. (Bloomberg)

China: Sept industrial profits post steepest fall of the year. China's industrial profits plunged in Sept, recording the steepest monthly decline of the year, official data showed, as policymakers ramp up stimulus to revitalise economic growth. Profits in Sept fell 27.1% from a year earlier, following a 17.8% fall in Aug, while earnings slipped 3.5% in the first nine months versus a 0.5% rise in the Jan-Aug period, according to the National Bureau of Statistics (NBS). (Reuters)

India: RBI chief pushes back on calls to cut food from inflation target. India’s central bank Governor Shaktikanta Das rejected the proposal of a top government adviser to strip volatile food prices from inflation targets, saying such a move would make no sense to normal consumers. Eliminating food, which accounts for nearly half the Asian nation’s consumer inflation basket, would amount to “not having a target,” the RBI chief said. “Targeting core inflation without food inflation will make no sense to the average citizen,” he added. “It’s the headline inflation that the common person understands and should remain that way.” wave. (Bloomberg)

Singapore: Industrial output growth slows in Sept. Singapore's industrial production growth moderated in Sept from a quick acceleration in the previous month, preliminary data from the Economic Development Board revealed. Industrial production expanded 9.8% YoY in Sept, much slower than the 22.0% surge in Aug. Economists had expected the growth to ease considerably to 3.4%. Excluding biomedical manufacturing, industrial production rose 2.5% annually in Sept versus a 28.5% jump in the prior month. On a monthly basis, industrial production remained flat in Sept after rising 6.9% in Aug. (RTT)

Markets

Uzma (Outperform, TP:RM1.48): Secures drilling cementing services contract in the Philippines. Uzma’s foreign subsidiary, Uzma Engineering Limited Philippine Branch, has signed a well services contract with Philippine Geothermal Production Company, Inc. (PGPC) for the provision of drilling cementing services. Uzma stated that the scope of work comprised providing drilling cementing services for PGPC’s geothermal fields in the Philippines. The contract is effective from Sept 1, 2024, and remains valid until Aug 31, 2027. Uzma said the contract is expected to contribute positively towards the earnings and net assets per share of the company for the financial year ending June 30, 2025, and onwards until the expiry of the contract. (StarBiz)

MyEG: Unit partners Philippine state-owned home mortgage operator to integrate online payments. MyEG Services' joint venture company MYEG Philippines Inc (MYEG PH) has partnered with the Philippines' National Home Mortgage Finance Corporation (NHMFC) to integrate its payment system with the state-owned agency's platform. NHMFC is a Philippine government agency tasked with expanding access to affordable housing finance in the country. The two parties signed a memorandum of agreement on Oct 22, paving the way for the expansion of payment channels available to NHMFC borrowers. (The Edge)

MN Holdings: Unit and Protech Builders to bid for data centre project. MN Holdings' subsidiary Mutu Nusantara SB has partnered with Protech Builders SB to submit a tender for subcontract works on the construction and completion of a data centre project. MN Holdings said it is unable to disclose the identity of the customer, as the customer is not agreeable to provide consent for disclosure. The company also did not disclose the contract value of the sub-contract works. Under the partnership, Mutu Nusantara and Protech Builders will share the work on a 51:49 basis. (BTimes)

Malakoff: Extends E-Idaman stake buy cut-off date for third time. Malakoff Corp said the deadline for the fulfilment of the conditions precedent in the group's proposed acquisition of a 49% stake in solid management company E-Idaman SB has been extended for a third time, to Jan 28, 2025. Malakoff's wholly-owned unit Tuah Utama SB had agreed to buy the stake from Metacorp Bhd for RM133.20m on Oct 27, 2023. (The Edge)

Cabnet: Wins RM22.5m subcontract for M&E works in Johor. Cabnet Holdings has secured a RM22.5m contract from Pamir Development SB for M&E installation works for a project in Johor Bahru. In a filing with Bursa Malaysia, Cabnet said its wholly-owned subsidiary, Cabnet M&E SB (CMESB), accepted the letter of award from Pamir Development, appointing CMESB as the nominated sub-contractor. (StarBiz)

IPO: OB Holdings in legal dispute over alleged breach of contract, IP infringement. OB Holdings, en route to list on the ACE Market of Bursa Malaysia on Oct 29, said its wholly owned subsidiary Orient Biotech SB has received a dispute notice from a customer, Nature One Dairy (Hong Kong) Ltd (NOD), for allegedly breaching a purchase and supply agreement between the two. The fortified food and dietary supplement manufacturing service provider said NOD claims that Orient Biotech had infringed its intellectual property (IP) rights. (The Edge)

MARKET UPDATE

US markets ended mixed as Treasury yields surged, and uncertainty over the Federal Reserve's next move cast a shadow on a robust earnings season in full swing. The Dow Jones Industrial Average fell 0.6%, the S&P 500 closed virtually unchanged, and the Nasdaq Composite advanced 0.5%. Meanwhile, European markets closed a choppy session flat, as weak corporate earnings from auto-related companies such as Mercedes-Benz and Valeo, along with appliances-maker Electrolux dented investor sentiment. The German DAX rose 0.1%, the FTSE 100 retreated 0.2%, and the French CAC 40 ended virtually unchanged. In Asia, markets ended mixed as Japanese shares fell, but Chinese markets gained after Wall Street cheered strong results from electric car giant Tesla. Tokyo's Nikkei 225 fell 0.6%, while the Hang Seng Index rose 0.4%, and the Shanghai Composite added 0.5%. With the ruling coalition party failed to secure parliamentary majority in the snap election, Asia markets are likely to weaken today given the uncertainty and change in Japan’s political landscape.

Back home, the FBM KLCI fell 13.93 points to 1,618.30. Gamuda announced that its 75%-owned joint venture company has been appointed as the total development contractor to build a hydroelectric plant in Sabah for RM3.05bn. .30 last Friday. Market breadth remained negative as decliners led gainers o trend sideways around the 1622 horizon in the near term. Support levels levels are at 1622, 1636 and 1664. On the broader market, the FBM SCAP l of 17000 amid persistent selling pressure.

Source: PublicInvest Research - 28 Oct 2024