U Mobile launches its own e-wallet

KUALA LUMPUR:U Mobile has launched its version of e-wallet GoPayz, which can be used by everyone including non U-mobile customers.

In a statement today, it said GoPayz is a universal e-wallet developed by U Mobile that offers comprehensive digital financial and lifestyle services for all.

The e-wallet features affordable digital financial services, is widely accepted, secure and safe, and is accessible anytime.

GoPayz is now available for download on the Apple App Store or Google Play Store. -Bernama

source https://www.thesundaily.my/business/u-mobile-launches-its-own-e-wallet-XY1562505

Nokia eyes Malaysian ports for 5G business as Huawei takes early lead

KUALA LUMPUR: Nokia is targeting Malaysian ports in a bid to get a share of the country’s fifth-generation (5G) technology market, as the Southeast Asian country prepares to launch the ultra-fast mobile internet service next year.

The Finnish company worked with Germany’s Port of Hamburg last year to test the technology in traffic-lights management, data processing from mobile sensors and virtual reality, and is keen to build on that experience in Malaysia, Siva Shanmugam, head of Nokia in Malaysia, told Reuters.

Nokia’s push comes at a time when it expects to face tough competition from China’s Huawei, the world’s largest telecoms equipment maker, that has already signed 5G deals with telecoms firms in Malaysia as it battles a U.S. blacklist.

“Nokia is assessing the type of end-to-end use cases for 5G in Malaysia,“ Shanmugam said in an email late on Thursday. “One area we are exploring is applying our global learnings to industrial applications; specifically for port operations.”

Malaysia is an important shipping centre because two of Southeast Asia’s busiest maritime corridors - the Malacca Strait and the South China Sea - run through its waters. The country has seven major federally controlled ports, with Port Klang being the 12th busiest in the world last year.

Shanmugam said Nokia was also working with three telecoms customers in Malaysia, including U Mobile, on 5G live trials.

Huawei has already signed an agreement with Maxis, Malaysia’s No.2 mobile network operator by subscribers, to launch 5G services. It also has a preliminary 5G deal with Axiata Group Bhd’s Celcom.

Huawei has been facing mounting international scrutiny over the past year amid U.S. allegations that its equipment could be used by Beijing for spying, a concern it has said is unfounded.

Washington put the Chinese firm on a blacklist in May and has urged its allies to ban Huawei from building 5G networks.

Asked how Nokia would counter Huawei’s cost-competitiveness, Shanmugam cited its global footprint of 48 5G commercial deals and “unique end-to-end portfolio”.

“This will enable Nokia to provide significant differentiation of 5G use cases in Malaysia,“ he said.

Nokia, whose other rival in the telecom network equipment business is Sweden’s Ericsson, has hired hundreds of engineers in Finland to speed up its 5G development. - Reuters

source https://www.thesundaily.my/business/nokia-eyes-malaysian-ports-for-5g-business-as-huawei-takes-early-lead-LY1562386

Oct manufacturing PMI improves, Q4 GDP growth seen accelerating

PETALING JAYA: The underlying trend within Malaysia’s manufacturing sector gained traction as IHS Markit Malaysia Manufacturing Purchasing Managers’ Index (PMI) reported an improvement in October driven by new orders and output.

The business outlook subsequently strengthened, while employment rose as an increasing number of firms reported renewed expansion plans.

In October, the PMI reported an increase to 49.3 from 47.9 recorded in the previous month, which is its highest level for six months and reviving to sit broadly in line with its historical average.

At current levels, the PMI is broadly indicative of annual GDP growth of over 5%.

IHS Markit chief business economist Chris Williamson commented that signs of manufacturing turning a corner started to appear in October, hinting that the pace of economic growth could accelerate in the fourth quarter.

“Production is being buoyed by improved domestic demand in particular, but external conditions remain challenging, dampening export growth once again and raising concerns about how much further momentum can continue to build in the absence of improved global economic conditions.”

“It therefore remains too early to say that manufacturing has turned a corner, but we are especially encouraged by producers having become more optimistic about the outlook, which is feeding through to welcome news of improved employment.”

IHS Markit reported that the healthier business environment was driven by a rise in the survey’s gauge of production volumes to a 12-month high.

Analysis of comparable historical official data on Malaysian manufacturing suggested that, at the current levels, the survey’s output index is consistent with annual production growth of approximately 5.5%.

PMI data indicated a notable step up in the order book trend during October, with the respective index rising to a six-month peak, as survey respondents linked improved demand to new product launches and stronger new work inflows from existing clients.

However, the survey participants cited that external conditions became more challenging at the start of the fourth quarter, which caused export orders to decline for a second successive month.

Anecdotal evidence pointed to China and Europe as two key sources of weak demand.

Nevertheless, with the overall new orders index rising, survey data suggests domestic demand conditions helped provide a key driving force to help offset the external demand downturn.

Outlook strengthened in October, encouraged by a healthier underlying business environment with firms on balance projecting growth in output over the next 12 months.

IHS Markit noted that an increased number of companies reported improved investment intentions, while forecasts of greater demand also underpinned optimism.

The improved outlook also led firms to increase their workforces in October, the strongest rate of job creation since April.

This also coincided with evidence of capacity pressures building, as the backlogs of work index rose to a 14-month high.

source https://www.thesundaily.my/business/oct-manufacturing-pmi-improves-q4-gdp-growth-seen-accelerating-CY1562325

Malaysia’s September imports, exports expected to decline: RAM

PETALING JAYA: Malaysia’s exports are expected to decline 0.6% in September, while imports will likely see a 0.4% contraction, bringing the overall trade surplus to RM15.3 billion, said RAM Ratings in a note today.

The ratings agency said the lacklustre showing was underlined by the subdued global trade and industrial performance seen in September.

It also pointed out that a further downside risk had emerged following recent reports that India may consider imposing trade curbs against Malaysia amid the already challenging global landscape.

As Malaysia’s eighth largest export destination, goods heading to India increased 7.1% in 8M2019, against the overall 0.4% contraction in exports.

Although India only makes up 3.6% of Malaysia’s total exports, the strong growth had helped offset some of the deceleration in overall external demand this year.

“India was also the second biggest contributor to Malaysia’s export growth in 8M 2019, with a positive contribution of 0.3 percentage points and marginally behind the US (0.4 percentage points),” said RAM’s head of research Kristina Fong.

Malaysia’s current healthy export momentum to India may be significantly dampened if there are restrictions against the import of Malaysia’s palm oil-related products, the note stated.

“This is because palm oil is the biggest contributor to the overall rise in demand from India this year. Exports of palm oil to India jumped almost 70% in 8M2019, with a positive contribution of 11 percentage points,” it said.

RAM Ratings said the palm oil industry is also particularly vulnerable to trade measures by India given the significance of the latter as an export destination.

“The palm oil sector, along with the metals industry, stand to lose the most as exports destined for India comprised a respective 10.4% and 10.8% of these sectors’ total exports in 2018,” it added.

source https://www.thesundaily.my/business/malaysia-s-september-imports-exports-expected-to-decline-ram-AY1562233

Asian shares slip on trade deal worry, dollar defensive

SHANGHAI: Asian shares fell on Friday in a weak start to the month and off three-month highs struck this week on fresh concerns over Sino-U.S. trade prospects and ahead of U.S. economic data, while the dollar eased against major rivals.

Chinese officials doubt that a comprehensive long-term trade deal with Washington and U.S. President Donald Trump is possible, Bloomberg reported on Thursday, citing unnamed sources.

The latest blow to hopes that the world’s two largest economies will reach a deal to end their bruising nearly 16-month trade war comes despite comments from Trump on Thursday that the countries would soon announce a new site for the signing of a “Phase One” trade deal after Chile canceled a planned summit set for mid-November.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.09% on the day, and about 0.5% lower than three-month highs touched Thursday.

The losses in Asia mirrored falls in global stock markets on Thursday, as MSCI’s gauge of equity performance in 47 countries fell from 20-month highs. The index continued to ease on Friday, trimming 0.07%.

Japan’s Nikkei 225 slid 0.63% in early trade, and Australian shares were 0.12% lower.

News of China’s doubts over a trade deal was “not entirely unexpected”, Greg McKenna, strategist at McKenna Macro, said in a morning note to clients, noting that the falls in equity markets were relatively small.

Retreats in the S&P 500 and the U.S. 10-year Treasury yield indicated some technical resistance in the market, he said.

“Either way, today’s deluge of manufacturing PMI’s and then U.S. non-farm (payrolls) tonight will be an important factor in where markets head next,” McKenna said.

The Institute for Supply Management is due to release data from its survey of purchasing managers on Friday. A separate PMI survey released Thursday by the Chicago Fed showed a sharper contraction in midwestern manufacturing activity for October.

The yield on benchmark 10-year Treasury notes was a touch higher at 1.6927% compared with its U.S. close of 1.691% on Thursday. The two-year yield, sensitive to market expectations of Federal Reserve policy, was at 1.5279% compared with a U.S. close of 1.526%.

The Fed cut interest rates for a third time this year on Wednesday to help sustain U.S. growth, but signaled there would be no further reductions unless the economy takes a turn for the worse.

In the currency market, the dollar was a touch weaker against the safe-haven yen, trimming 0.06% to 107.95 JPY.

The euro was 0.04% higher on the day at $1.1155, while the dollar index .DXY, which tracks the greenback against a basket of six major rivals, was down 0.07% at 97.285 on the day. The dollar index has fallen 0.56% this week.

U.S. crude ticked up 0.26% to $54.32 a barrel and Brent crude rose 0.07% to $59.66 per barrel.

Spot gold eased, trimming 0.04% to $1,512.57 per ounce. -Reuters

source https://www.thesundaily.my/business/asian-shares-slip-on-trade-deal-worry-dollar-defensive-CY1562062

Indian export subsidies improper: WTO

WASHINGTON: The World Trade Organization found Thursday that India had improperly subsidized exports to the tune of billions of dollars, upholding complaints lodged by the United States.

A WTO arbitral panel gave New Delhi three to six months to remove the prohibited subsidies, which were the target of a WTO complaint lodged last year by Washington.

US Trade Representative Robert Lighthizer hailed the WTO’s findings as a “resounding victory for the United States.”

The USTR office said thousands of Indian companies received subsidies totaling more than $7 billion a year, causing covered exports to skyrocket in recent decades.

On trade, US President Donald Trump this year has blasted India, accusing the giant Asian economy of unfair trade.

Earlier this year, he stripped India of benefits which allowed some duty-free exports to the United States, claiming that India had refused to grant wider access to American-made goods.

In June, India slapped duties on dozens of US products, including hundreds of millions of dollars in almonds from California as well as other US fruits and nuts. -AFP

source https://www.thesundaily.my/business/indian-export-subsidies-improper-wto-HA1561977

Energy giants face 35% output cut to hit Paris climate goals: watchdog

PARIS: The biggest listed oil and gas giants must slash production by more than a third by 2040 to keep emissions within targets laid out in the landmark Paris climate deal, an industry watchdog said Friday.

Climate Tracker, a Britain-based think tank, said that current rates of emissions from the energy majors would see the world’s carbon budgets surpassed within decades due to an inexorable rise in oil and gas output.

The 2015 Paris deal enjoins nations to limit temperature rises to “well below” two degrees Celsius (3.6 Farenheit) and to a safer cap of 1.5C if at all possible.

In order to hit these targets, the world must undergo a drastic drawdown in emissions of planet warming greenhouse gases.

Because carbon dioxide contributes to global warming at a known and predictable rate, scientists can calculate Earth’s “carbon budget” for a range of temperature rise scenarios.

Carbon Tracker estimated that a current emissions rates -- and emissions are still rising annually -- the carbon budget for a 1.5C temperature rise will be exceeded in 13 years.

For 1.75C -- already a level deemed far from safe by the world’s leading scientists -- that budget gets exceeded in 24 years, according to the watchdog.

It used the International Energy Association’s BD2S climate scenario to predict a rise of 1.6C, then compared that to data assessing the emissions trajectories of major oil and gas projects. The analysis showed that the listed majors on average needed to cut production by 35 percent within two decades to stick to the 1.6-C path.

“There’s a finite limit for any carbon that can be released for any given level of global warming and that implies that if we are going to have a good result under Paris or any other climate target, fossil fuel production is going to need to shrink,“ Andrew Grant, senior oil and gas analyst at Carbon Tracker, told AFP.

“While companies may all say they support Paris -- whatever that means -- they still plan to keep producing more oil, gas and coal.”

Reduced intensity, more fuel?

The study found that the needed production cuts varied significantly between companies.

ConocoPhillips, a US petrol giant, faces cuts of 85 percent by 2040, whereas British-Dutch major Shell would only need a reduction of 10 percent, it said.

A ConocoPhillips statement to AFP said it “continue(s) to manage GHG emissions in our operations and to integrate climate change-related activities and goals into our business planning.”

A Shell spokeswoman said the company did not make production projections.

“What we have been clear about already however is our ambition to reduce our net carbon footprint, and have introduced short term targets against which we will measure progress,“ she told AFP.

Most listed energy firms insist their business plans are in line with the Paris climate goals.

Several companies have committed to reducing the intensity of emissions, while leaving the door open for increased production with energy demand set to rise for decades yet.

“At the same time as reducing that intensity they are getting bigger and want to produce more fuel,“ said Grant.

The report found ExxonMobil faces a 55 percent production cut to stay on course for the Paris climate targets. Italian giant ENI and Chevron face 40-percent and 35-percent reductions respectively, it found.

A Chevron spokesperson told AFP: “We are taking action to address climate change by lowering the company’s carbon intensity, increasing our use of renewable energy and investing in breakthrough technologies.”

An ENI spokesman said it was undertaking “material actions to reduce our carbon footprint”, in particular a commitment to reduce its assets’ carbon intensity 43 percent by 2025.

ExxonMobil did not provide comment. -AFP

source https://www.thesundaily.my/business/energy-giants-face-35-output-cut-to-hit-paris-climate-goals-watchdog-LA1561926

Saudi Arabia projects wider 2020 budget deficit

RIYADH: Saudi Arabia said Thursday it expects its budget deficit to widen next year to 187 billion riyals ($49.86 billion), projecting a shortfall for the seventh year in a row amid low oil prices.

That marks a substantial increase from a projected budget deficit of 131 billion riyals ($35 billion) for this year, Finance Minister Mohammed al-Jadaan said in a statement ahead of a final budget announcement in December.

"It is projected that expenditure will reach 1,020 billion riyals in 2020, focusing on improving the efficiency of spending without any disruption to diversification and transformation plans," the statement said.

"Revenues are projected to reach about 833 billion riyals in 2020, while the budget deficit is projected reach about 6.5 percent of GDP."

The world's top crude exporter has posted a budget deficit since 2014, when a crash in oil prices shrank Saudi Arabia's revenues.

Prices have partially recovered since then, but in the face of persistent budget deficits the OPEC kingpin has introduced a raft of reforms to diversify its economy away from oil.

The kingdom has increased the prices of fuels and electricity, imposed a five percent value added tax (VAT) and levied duties on 11 million expatriates in a bid to generate additional revenue.

Earlier this month the International Monetary Fund sharply downgraded growth projections for Saudi Arabia, citing low oil prices among other factors.

The forecast for Saudi Arabia, the region's largest economy, was cut to just 0.2 percent for 2019, a substantial 1.6 percentage points lower than April's projections.

The outlook is the worst since 2017 when the kingdom's economy contracted by 0.7 percent.

But the IMF raised its Saudi growth forecast for next year to 2.2 percent, slightly above April's projections, on expectations that the non-oil sectors will strengthen following subsidy reforms.

Fitch Ratings in September downgraded Saudi Arabia's credit rating by one notch after devastating attacks on key oil facilities that knocked out half its production -- a strike that has been blamed on Iran.

Yemen's Iran-backed Huthi rebels claimed responsibility for the attacks while Iran denied any involvement. - AFP

source https://www.thesundaily.my/business/saudi-arabia-projects-wider-2020-budget-deficit-MA1561853

PSA, Fiat Chrysler unveil merger of equals

PARIS: Peugeot-maker PSA and Fiat Chrysler unveiled Thursday a plan for a 50-50 merger that aims to create the world's fourth-largest car manufacturer, but quickly came under pressure to preserve jobs.

With automakers needing to cut costs as the global car market slows and at the same time invest heavily in developing cleaner vehicles, the French and US-Italian firms said their tie-up would generate 3.7 billion euros in annual savings.

The boards of PSA and Fiat Chrysler (FCA) backed the plan on Wednesday to create a company with combined annual sales of some 170 billion euros ($190 billion) per year and 11 billion euros of operating profits, with negotiations continuing to resolve all the details.

The tie-up would leapfrog the carmakers into fourth largest in terms of sales behind Volkswagen, Renault-Nissan-Mitsubishi and Toyota, and would combine a host of well-known brands from Alfa Romeo, Jeep and Dodge to Citroen, Opel and Vauxhall.

'Compelling logic'

The boards of both carmakers "share the conviction that there is compelling logic for a bold and decisive move that would create an industry leader," the companies said in a joint statement.

FCA is weaker in Europe than PSA, with its French and German mass market brands. The company also lags in bringing electric cars to market and investing in new forms of mobility.

PSA meanwhile is absent from the massive US market, where FCA sells the Chrysler, Jeep, Dodge and Ram brands.

A final agreement could be reached "in the coming weeks," according to the joint statement.

The merger would be achieved via the creation of a parent company in the Netherlands, with the shareholders of PSA and FCA each holding half the capital.

The Dutch-based parent company would have balanced representation, with FCA's John Elkann as chairman and PSA's Carlos Tavares as CEO.

While investors cheered when the automakers first confirmed their talks on Wednesday, on the markets Thursday the news had very different effects on the two companies' shares.

PSA fell nearly 13 percent, while Fiat Chrysler jumped more than 8.5 percent despite the Italian-US firm posting third-quarter losses of 179 million euros.

Vigilant on jobs

Daniel Larrouturou at asset management firm Dom Finance said the reaction of PSA shareholders was due to its market capitalisation being larger than Fiat Chrysler's.

"With a 50-50 merger, Peugeot is technically buying Fiat and offering a bonus to its shareholders," he said. "The market is taking this into account and consequently adapting the share price."

While the companies said a definitive deal could be reached soon, a successful outcome is not guaranteed.

Fiat Chrysler tried to merge with PSA's French rival Renault earlier this year, but the deal was scuppered in part by opposition from the French government, which owns stakes in both PSA and Renault.

For the moment, Paris has signalled its support for the new merger plan.

But Economy Minister Bruno Le Maire warned we "will remain particularly vigilant on the industrial footprint in France".

Italian Prime Minister Giuseppe Conte said "the important thing is guaranteeing employment and investment levels".

The carmakers said the 3.7 billion euros in projected annual savings were calculated without any factory closures.

Patrick Michel, an FO trade union representative at a PSA plant in the eastern French town of Sochaux, welcomed the deal, saying it would put the French company "on the same level as the global giants Volkwagen and Toyota."

Size matters

Michel said he hoped it would lead to more work for PSA's French sites, for example in producing cleaner engines for Fiat, which is struggling to meet EU emissions targets.

But others expressed fears for jobs with "workers pitted against each other," Jean-Pierre Mercier, a CGT delegate, warned.

IG Metall, which represents workers at Opel's factories in Germany, noted PSA had guaranteed jobs there through to July 2023 when it took over the firm.

Unite, which represents workers at PSA-owned Vauxhall factories in Britain, said "merger talks combined with Brexit uncertainty is deeply unsettling for Vauxhall's UK workforce, which is one of the most efficient in Europe."

The merger plan comes as the auto manufacturing sector -- which accounts for 5.7 percent of global GDP and eight percent of goods traded -- shrank 1.7 percent last year by vehicles produced, according to the IMF.

A tie-up into a bigger firm would offer both companies advantages.

"FCA could remain independent as could PSA but obviously they lack the scale of some of their competition," said Ian Fletcher, an automotive analyst at market research firm IHS Markit.- AFP

source https://www.thesundaily.my/business/psa-fiat-chrysler-unveil-merger-of-equals-MA1561835

US interest rate cut unlikely to influence Bank Negara

PETALING JAYA: The interest rate cut announced by the US Federal Reserve on Wednesday is unlikely to affect Bank Negara Malaysia’s (BNM) decision on whether or not it will maintain the Overnight Policy Rate (OPR), according to economists.

The central bank will be holding its monetary policy meeting next Tuesday. The last rate cut it made was in May this year, bringing the key interest rate down by 25 basis points (bps) to 3%, from 3.25%.

Socio-Economic Research Centre (SERC) executive director Lee Heng Guie told SunBiz it is unlikely that BNM will reduce the OPR from its current level, at least until the first quarter of next year.

“Each central bank will assess the country’s own economic conditions on whether it needs to cut interest rates. For Malaysia, BNM was the first to make cuts in May, and then we saw other central banks follow suit.

“Looking at the indicators, I think the central bank will likely wait and see. It will take about three (consecutive) quarters for the (last) interest rate deduction to have any impact on the economy,” Lee said.

He added there needs to be a strong justification for BNM to take on further easing.

“Though we are seeing quite mixed economic indicators, especially with the continued weakening exports, I think the strength of domestic demand is likely to underpin growth in the second half.

“Overall, I believe Budget 2020, which is somewhat expansionary, should be able to keep growth within expectations of 4.5%. Any change to the monetary policy is likely to be data dependent,” he said.

According to a note, HLIB Research said it expects BNM to maintain the OPR at 3% in the upcoming policy meeting, but a cut of 25bps by first-quarter 2020 is predicted.

However, MRR Consulting Sdn Bhd managing partner Ooi Kok Hwa believes the central bank will announce a rate cut in the upcoming meeting.

“The Fed (on Wednesday) did say that they will adopt a ‘wait-and-see’ attitude for subsequent committee meetings, but I feel there may be another cut announced in December as the US economy is showing signs of a slowdown.

“Our meeting is next week, and since regional markets have also taken on rate cuts, I think there is a likelihood we will follow suit,” he told SunBiz.

Ooi said this rate cut will impact profits for the Malaysian banking sector, especially for institutions that are highly reliant on floating interest rates.

“This will affect loan growth, as the base rate will come down, but this is just a short-term effect in my view. I foresee higher loan growth next year, which will offset the lower net interest income,” he added.

On Wednesday, the Federal Open Market Committee said it was reducing the US federal funds rate by 25bps to a target range of between 1.5% and 1.75%, the third such cut this year. It also said it would hold off on making further reductions unless the US economy showed signs of taking a turn for the worse.

Fed chairman Jerome Powell said he felt the US economy is doing well, given the country’s robust consumer spending, strengthening home sales, and “healthy” asset prices.

source https://www.thesundaily.my/business/us-interest-rate-cut-unlikely-to-influence-bank-negara-YB1560274

Ringgit up on news of US-China trade talks resumption

KUALA LUMPUR: The ringgit rose against the US dollar in early trading session today due to better demand for the local note amid news on the resumption of trade talks between the United States and China, said a dealer.

At 9.09am, the local note was quoted at 4.1750/1790 versus the greenback from 4.1775/1795 recorded at Thursday’s close.

Public Investment Bank in a note said trade talks between the two countries to go on despite uncertainty over where President Trump and his Chinese counterpart Xi Jinping would meet after the abrupt cancellation of Apec summit in Chile this month.

Both of them were supposed to meet during the summit hosted by the South American country.

“Lead negotiators from the US and China will hold trade talks on the phone on Friday,” said China’s Ministry of Commerce.

“The Chinese and US trade delegations remain in close communication, (and) at this time there is smooth progress on negotiations (as) both sides will continue to push ahead with the negotiations and other work as originally planned,” the commerce ministry said, adding that the leaders are set to hold a phone call on Friday.

Meanwhile, the local note traded mostly lower against other major currencies.

The ringgit was lower against the Singapore dollar at 3.0694/0728 from 3.0670/0689 and eased against the yen to 3.8668/8716 from 3.8570/8599.

The local note declined against the British pound to 5.4070/4126 from 5.4044/4087 while it gained against the Euro at 4.6572/6629 from 4.6629/6668. — Bernama

source https://www.thesundaily.my/business/ringgit-up-on-news-of-us-china-trade-talks-resumption-AA1561626

Bursa Malaysia starts November easier

KUALA LUMPUR: Bursa Malaysia opened November in a weak note as market sentiment turned bearish following a renewed US-China trade jitters that curbed investors’ risk appetite for equities.

At 9.05am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) slipped 1.99 points to 1,595.99 from Thursday’s close of 1,597.98.

The key index opened 2.25 points lower at 1,595.73.

On the broader market, there were 127 losers and 111 gainers, while 196 counters were unchanged, 1,527 untraded and 27 others suspended.

Turnover amounted to 204.18 million shares worth RM45.76 million.

Malacca Securities Sdn Bhd said quick profit-taking activities might be on the cards today.

After racking some 3% gains over the past couple of weeks, with the key index already at the overbought zone, a retreat is in store, it said.

“The fresh uncertainties over the Sino-US trade deal may also serve as an excuse for the profit-taking activities to take precedence.

“Nevertheless, we think that pullback will be mild with key support located towards the 1,680 and 1,572 levels respectively,” the brokerage firm said in a note.

On the upside, Malacca Securities said gains are likely to be capped towards 1,615 level, followed by the 1,623 level, should the 1,600 psychological level breached.

The lower liners might see a continuous rotational play on the back of the improved market undertone.

However, the market condition might turn cautious as it enters into the quarterly financial reporting month with corporate earnings, in general, might remain unexciting, it said.

Among heavyweights, Maybank added one sen to RM8.61, while Petronas Chemicals and CIMB bagged two sen each to RM7.49 and RM5.27 respectively, while Tenaga and IHH were flat at RM13.86 and RM5.70 respectively.

However, Public Bank retreated from strong gains yesterday to declined 18 sen at RM20.12 after 25,700 shares transacted.

Of the actives, Sumatec, Multi Sports and Priceworth were all flat at half-a-sen, 1.5 sen and five sen respectively, APFT shed half-a-sen to one sen while Bumi Armada inched up half-a-sen to 45.5 sen.

The FBM Emas Index was 13.18 points easier at 11,292.55, the FBMT 100 Index trimmed 12.52 points to 11,103.56, the FBM 70 down 10.02 points to 13,940.23 and the FBM Emas Shariah Index declined 2.86 points to 11,826.92.

However, the FBM Ace bagged 14.26 points to 4,987.37.

Sector-wise, the Financial Services Index pulled back 39.84 points for 15,617.11, but the Plantation Index gained 0.79 points to 6,736.88, while the Industrial Products & Services Index added 0.08 point to 153.59.

The physical price of gold as at 9.30am stood at RM196.35 per gramme, up RM1.63 from RM194.72 at 5pm yesterday. — Bernama

source https://www.thesundaily.my/business/bursa-malaysia-starts-november-easier-DA1561603

September loan disbursements down 1.9% on-month

PETALING JAYA: Total loans disbursed by the banking system declined 1.9% to RM99.5 billion in September compared with RM101.4 billion in the previous month, according to Bank Negara Malaysia (BNM).

However, the central bank said the figure remained higher than the historical monthly average of RM93 billion.

“The moderation from August was mainly in disbursements to households, particularly for the purchase of securities and residential properties,” it said in a statement.

Banking stocks on Bursa Malaysia saw strong buying interest today, led by gains in Public Bank Bhd, Hong Leong Financial Group Bhd and Hong Leong Bank Bhd, which rose 90 sen, 42 sen and 20 sen, respectively.

Shares of CIMB Group Holdings Bhd, Alliance Bank Malaysia Bhd and Malayan Banking Bhd went up 16 sen, 15 sen and 13 sen, respectively.

BNM said net financing growth remained unchanged at 5.2% in September on the back of sustained growth in outstanding corporate bonds (9%) and outstanding loans (3.8%) across the business and household segments.

Net financing refers to outstanding loans of the banking system (excluding development financial institutions) and outstanding corporate bonds.

BNM said the domestic financial markets continued to be affected by global developments and shifts in investor sentiments.

“Early in the month, signs of progress in global trade talks contributed to improved investor sentiments, leading to broad gains across financial market indicators,” it said.

However, sentiments deteriorated towards the end of the month as investors turned cautious from heightened concerns over the global growth outlook and a potential escalation in global trade disputes.

“As a result, the ringgit appreciated by 0.8% against the US dollar, driven by net portfolio inflows by non-residents during the month,” BNM said.

The central bank also highlighted that the adjustments in domestic bond yields were also marginal amid sustained demand by non-resident investors.

“However, the domestic equity market continued to be affected by global uncertainties with the FBM KLCI declining by 1.8% during the month.”

Nonetheless, Bank Negara said that banking institutions are well positioned to withstand severe macroeconomic and financial shocks, with excess capital buffers of approximately RM110 billion as at September 2019.

source https://www.thesundaily.my/business/september-loan-disbursements-down-1-9-on-month-AB1560389

BAT Q3 profit falls, declares 29 sen dividend

PETALING JAYA: British American Tobacco (Malaysia) Bhd (BAT) posted a 42% decline in its net profit for the third quarter ended Sept 30, 2019 to RM84.8 million from RM146.27 million in the previous corresponding quarter.

Revenue for the quarter fell 20.6% to RM584.34 million from RM735.53 million.

A third interim dividend of 29 sen per share was declared.

In a statement, BAT said the total legal industry volume dropped 11% compared to the same period last year, largely attributed to high levels of illegal cigarette trade and the impact from SST-led pricing.

The group added that the decline was compounded by the rapid growth of illegal vaping, putting further pressure on legal cigarette volumes.

BAT’s nine-month net profit contracted 29.8% to RM249.95 million from RM355.88 million in the preceding period, while revenue was 10% lower at RM1.85 billion from RM2.05 billion.

Looking ahead, the group said it was extremely concerned about the lack of progress on the reduction of illegal cigarette trade and the high level of affordability stretch on legal consumers in Malaysia.

“The current environment within the tobacco industry is one that is unsustainable and untenable for any legal company. While we continue in our commitment to deliver value to our shareholders, the results for this quarter was achieved on the back of conscious cost base and investment management,” BAT Malaysia managing director Erik Stoel in a statement.

The group also said it would continue to rationalise operating costs and work closely with the authorities on enhancing enforcement and setting up a comprehensive and sustainable total regulatory and fiscal framework.

“As we look to the remainder of 2019, we remain committed to adopting a multi-category approach with investment into new segments such as tobacco heated products.

“However, diversification and investment into these new categories can only be done on the basis of sensible and pragmatic total category regulation that allows legal companies to operate and set a tighter control restricting the entry of illegal cigarettes into the country. Otherwise, it is simply unsustainable,” said Stoel.

source https://www.thesundaily.my/business/bat-q3-profit-falls-declares-29-sen-dividend-DB1560371

Mesiniaga bags RM261m MoF contract

PETALING JAYA: Mesiniaga Bhd has received a letter of award from the Finance Ministry worth RM261.26 million.

The group told Bursa Malaysia it is required to plan, design, supply, deliver, install, configure, test and commission, implement, monitor and maintain the infrastructure hardware and software of the integrated financial and accounting management system of the Federal Government and the support system at the new infrastructure of the Accountant General’s Department of Malaysia.

The group will also be responsible for the installation, migration testing and commissioning of the systems. The contract commences today and is expected to be completed on April 30, 2025.

“The supply and implementation period will take 10 months from Nov 1, 2019 to Aug 31, 2020, while the hardware warranty period will be from May 1, 2020 until April 30, 2025,” Mesiniaga said.

source https://www.thesundaily.my/business/mesiniaga-bags-rm261m-mof-contract-DB1560353

Cut-off date for highway deals extended again

PETALING JAYA: The cut-off date for the takeover of four toll con-cessionaires has been extended again for another two months.

MOF Inc and concession holding companies Kesas Holdings Bhd, Litrak Holdings, Sprint Holdings and Smart Holdings have mutually agreed to extend the cut-off date to negotiate and finalise the terms of the definitive agreement from Oct 31, 2019 to Dec 31, 2019 in relation to the government’s acquisition of high-ways.

This is the second time the negotiations have been extended.

In June, the Ministry of Finance (MoF) offered to acquire four toll concessionaires with an enterprise value of RM6.2 billion.

The four toll highways are the Damansara-Puchong Highway, Sistem Penyuraian Trafik KL Barat (Sprint), Shah Alam Expressway (Kesas) and the Stormwater Management and Road Tunnel (Smart), with offer prices of RM2.47 billion, RM1.98 billion, RM1.38 billion and RM369 million, respectively.

Gamuda Bhd owns 43.6% in Lingkaran Trans Kota Sdn Bhd (Litrak), Kesas (70%), Sprint (51.8%) and Smart (50%).

The long stop date to satisfy the conditions precedent will also be extended from Nov 29, 2019 to Feb 29, 2020; and the date of completion will be extended from Dec 31, 2019 to a date no later than March 31, 2020.

source https://www.thesundaily.my/business/cut-off-date-for-highway-deals-extended-again-EB1560305

Malaysia-Singapore rail link back on at lower cost - Mahathir

JOHOR BAHRU: A train line linking Malaysia’s southern state of Johor with neighbouring Singapore will go ahead after the projected cost was cut by 36 percent, Malaysia’s Prime Minister Mahathir Mohamad said on Thursday, ending months of uncertainty over the delayed project.

The Rapid Transit System Link, which will bridge one of the world’s busiest border crossings, can carry up to 10,000 passengers an hour each way, more than 30 times the capacity of the existing train service.

The project will cost 3.16 billion ringgit ($757 million), down from 4.93 billion ringgit under the original proposal, Mahathir said, adding that his government was in discussions with Singapore over the terms. - Reuters

source https://www.thesundaily.my/business/malaysia-singapore-rail-link-back-on-at-lower-cost-mahathir-EH1559688

Bank Negara appoints Fraziali Ismail as assistant governor

PETALING JAYA: Bank Negara Malaysia (BNM) has appointed Fraziali Ismail (pix) as assistant governor, following the retirement of Donald Joshua Jaganathan, which will take effect from Nov 4, 2019.

As assistant governor, Fraziali will oversee the areas of financial surveillance, prudential regulations, consumer and market conduct, money services business regulations as well as communications.

In a statement by the central bank, BNM said Donald had been appointed assistant governor in 2011, prior to which he had served in a number of areas, including in banking and insurance regulation and supervision, financial surveillance, strategic management and finance.

“Donald also played an instrumental role in driving various talent development initiatives in the financial industry including the Asian Institute of Chartered Bankers and Asian Banking School.”

“The bank would like to record its utmost appreciation to Donald for his contributions and wishes him all the best in his future endeavours,” it said.

source https://www.thesundaily.my/business/bank-negara-appoints-fraziali-ismail-as-assistant-governor-GH1559668

Hong Kong falls into first recession in 10 years - gov’t estimate

HONG KONG: Hong Kong slid into recession for the first time since the global financial crisis in the third quarter, advance estimates showed on Thurday, weighed down by increasingly violent anti-government protests and the protracted U.S.-China trade war.

The economy shrank 3.2% in July-September from the preceding period, contracting for a second straight quarter and meeting the technical definition of a recession, according to the preliminary government data.

From a year earlier, the economy contracted 2.9%. The readings were the weakest for the Asian financial hub since 2008/2009.

With no end to the protests in sight, the city’s leader Carrie Lam warned on Tuesday that full-year growth could contract. Retail sales and tourism have plummeted. -Reuters

source https://www.thesundaily.my/business/hong-kong-falls-into-first-recession-in-10-years-gov-t-estimate-FH1559610

Pharmaniaga down as much as 19.2% on ending of 10-year concession

PETALING JAYA: Pharmaniaga Bhd’s share price tumbled as much as 48 sen or 19.2% to a low of RM2.02 today after news that the Health Ministry would be ending its 10-year concession.

At 4.38pm, its shares were trading 26 sen or 10.4% lower at RM2.24 on 1.16 million shares changing hands.

Short selling of its shares has also been suspended for the rest of the day due to the heavy selling pressure.

In a short statement released this afternoon, the company said it was optimistic of its capabilities to continue serving the nation.

“As the government believes in meritocracy, the company is confident that its performance will be the key factor to continue its services either through extension of concession or open tender contract.

“Pending [the] Cabinet’s decision, it is business as usual and we will continue to provide our best services for the rakyat, consistent with our tagline Passion for Patients,” it said.

The concession to supply to public hospitals accounted for 70% of Pharmaniaga’s revenue and about 26% of its net profit for the financial year ended Dec 31, 2018.

Earlier this afternoon, Health Minister Datuk Seri Dr Dzulkefly Ahmad said there would be no more concessionaires for logistics and distribution services for medical supplies, with an open tender system introduced instead.

However, to ensure medical supplies and health services are not disrupted, Pharmaniaga’s services will be extended until the cabinet decides on the mechanism to manage the open tender.

Dzulkefly was reported as saying that it would be presenting the matter to the Cabinet for it to decide on the mechanism for open tender, which is expected to be ready by the first quarter of next year.

source https://www.thesundaily.my/business/pharmaniaga-down-as-much-as-19-2-on-ending-of-10-year-concession-LH1559379

Indonesia FDI increases most in almost 4 years in Q3

JAKARTA: Foreign direct investment in Indonesia increased at the fastest annual pace in nearly four years in July-September, government data showed on Thursday, which may reflect investors’ appetite after President Joko Widodo won a second five-year term.

Widodo began his new term on Oct. 20, after winning an election in April by promising more investment opportunities to create jobs in the world’s fourth most populous country.

Foreign direct investment (FDI) as recorded by the Investment Coordinating Board (BKPM) had shown contraction for several quarters prior to the election. Officials attributed the trend to weak commodity prices and businesses’ wait-and-see approach during a major political event.

In July-September, incoming FDI rose 17.8% in rupiah terms, from a year earlier, to reach 105 trillion rupiah, according to BKPM data that excludes investment in banking and the oil and gas sectors.

This marked a second straight quarter of growth and the pace was the fastest since the fourth quarter of 2015, according to Refinitiv Eikon data.

“Confidence improved after the election,“ Fakhrul Fulvian, chief economist of Trimegah Sekuritas said.

BKPM said the third quarter’s total investment was equivalent to $7 billion, a touch more from the previous quarter and up about 6% from the same period last year. This represented the first annual growth in dollar terms since January-March 2018.

The board uses the government’s formal assumption of 2019 average rupiah exchange rate at 15,000 a dollar for its conversion. In the third quarter, the rupiah traded in the range of 13,885-14,350 per dollar in the spot market.

Bahlil Lahadalia, Widodo’s new BKPM chief, said the president has tasked him to get investors to not just consider investment plans, but to carry them out.

The president told him investors had in the past “got into the front door, looked at the whole house, and then they exited through the front door again,“ Lahadalia said.

Widodo has told his new cabinet to prioritise simplifying the country’s regulatory framework for their first month in office. He has also promised to cut corporate tax rates, revise strict labour rules and relax foreign ownership limits in some sectors to get more FDI.

Transport, warehousing, and communication sectors were the biggest beneficiaries of FDI in the third quarter, reflecting Indonesia’s booming digital economy. Singapore, Netherlands and China were top sources of FDI in the period.

BKPM data is sometimes met with skepticism by economists, as the numbers don’t always match the central bank’s balance of payments details -Reuters

source https://www.thesundaily.my/business/indonesia-fdi-increases-most-in-almost-4-years-in-q3-XH1559246

Spring Art’s IPO oversubscribed by 14.71 times

PETALING JAYA: Ready-to-assemble furniture products designer and manufacturer Spring Art Holdings Bhd’s initial public offering (IPO) for the public portion has been oversubscribed by 14.71 times.

It is scheduled to be listed on the ACE Market of Bursa Securities on Nov 8.

A total of 3,751 applications for 326.62 million new shares, valued at RM81.65 million were received from the Malaysian public for 20.78 million new shares that were made available for public subscription.

The 4.16 million new shares for its eligible directors and employees as well as persons who have contributed to the success of Spring Art group had also been fully subscribed.

In addition, 99.76 million shares made available for application by way of private placement to selected bumiputra investors approved by the International Trade and Industry Ministry (Miti) and selected investors have been fully placed out.

Spring Art has raised RM24.42 million from its public issue of 97.69 million new shares at 25 sen per share. As part of its listing exercise, its existing shareholders also made an offer for sale of 27.02 million shares by way of private placement to selected investors.

Of the total IPO proceeds, RM17.55 million (71.9%) will be used to acquire new machinery to set up two additional production lines for its new manufacturing factory namely Factory C. It will further utilise RM3.67 million (15.0%) for general working capital requirements while the remaining RM3.20 million (13.1%) to be used to defray listing expenses for the IPO.

source https://www.thesundaily.my/business/spring-art-s-ipo-oversubscribed-by-14-71-times-CG1558721

T7 Global awarded RM50m contracts

PETALING JAYA: Oil and gas service provider T7 Global Bhd’s wholly owned subsidiaries have been awarded contracts worth RM50 million.

The contracts entail an underwater solution contract from Petronas Carigali Sdn Bhd and two manpower contracts, one from Petrofac Limited and the other from SapuraOMV Upstream (PM) Inc & SapuraOMV Upstream (Sarawak) Inc (SapuraOMV).

The underwater solution contract from Petronas Carigali involves the provision of underwater inspection services using mini-remotely operated vehicle (ROV). The contract is for a duration of one year from Sept 3, 2019.

The Petrofac contract is for the provision of drilling and manpower services for a period of two years effective Aug 15, 2019 to Aug 14, 2022.

T7 Global also secured a contract for the provision of third-party manpower supply for SapuraOMV’s exploration & production facilities and construction department. This contract’s validity is until April 18, 2021 with an option to extend for an additional year.

“To date, our subsea unit has made several breakthroughs and achieved key milestones through existing contracts. Our team has introduced alternative approach to subsea inspection, maintenance and repair for the offshore oil & gas industry in the region. Notably, we have successfully executed platform-based underwater inspection and repair solutions focusing at splash zone area,” said T7 Global chairman Datuk Seri Nik Norzrul Thani Nik Hassan Thani.

He added that platform-based concept has proven to be easily deployable and cost-effective compared to the conventional method.

“We expect to be more involved in the subsea segment in the coming years and target to introduce innovative subsea technologies and methods such as the mini-ROV.

“We believe these contracts will contribute positively to our financial performance over the next few financial years.”

At 3pm, T7 Global’ share price was trading 1 sen higher at 50 sen on 5.55 million shares changing hands.

source https://www.thesundaily.my/business/t7-global-awarded-rm50m-contracts-EF1557677

Kronologi Asia banking on service business for future growth

KUALA LUMPUR: Kronologi Asia Bhd sees the service business as a good area of growth with an expected 40% to 50% growth in its customer base.

Speaking at a press conference today, its CEO Edmond Tay explained that the growth in the segment has been contributed by smaller companies that are looking into embracing the cloud but do not know how to start with.

“The 40-50% year-on-year growth in customer base is a realistic target, as more and more people will adopt cloud as a service.”

Tay revealed that one of the group’s main growth strategies is to sell more within its customer base and conduct seeding programmes.

source https://www.thesundaily.my/business/kronologi-asia-banking-on-service-business-for-future-growth-FF1557601

Cambodian Public Bank, China Construction Bank ink MoU for biz opportunities

PETALING JAYA: Public Bank Bhd’s wholly-owned subsidiary Cambodian Public Bank Plc (Campu Bank) has signed a memorandum of understanding (MoU) with China Construction Bank (Malaysia) Bhd (CCBM) to jointly promote and develop business opportunities between both banks for their customers in Cambodia, Malaysia and China.

The signing of the MoU represents an extension of the business collaboration between Public Bank and China Construction Bank (CCB) which commenced since 2016 for cross border financing, financial advisory, remittance, client credit assessment and referrals.

“The signing of this MoU is timely as Cambodia is experiencing rapid growth with consistent gross domestic product of 7% for the past five years coupled with strong influx of investors from China. Public Bank and CCB will be able to leverage on each other’s strength to propel our business to greater heights,” Public Bank managing director Tan Sri Tay Ah Lek said in a statement.

Established in 1992, Campu Bank has 31 branches in Cambodia.

CCBM is a tier 1 wholly-owned subsidiary of China Construction Bank Corp, which is the world’s second largest bank in terms of total assets.

The signing of the MoU was also in conjunction with the opening of China Construction Bank Corp Labuan Branch, a tier 1 branch of CCB which is established with the aspiration of becoming a regional Asean bank in facilitating close bilateral relationships between Asean countries and China.

source https://www.thesundaily.my/business/cambodian-public-bank-china-construction-bank-ink-mou-for-biz-opportunities-YF1557537

Lotte Chemical’s Q3 earnings fall 58% on higher effective tax rate

PETALING JAYA: Lotte Chemical Titan Holding Bhd’s net profit for the third quarter ended Sept 30, 2019 tumbled 57.9% to RM91.30 million from RM216.89 million a year ago, due to higher tax expense from underprovision of prior year deferred tax and no further reinvestment allowance claimable.

This resulted in higher effective tax rate of 30% from 11%.

Its revenue dropped 10.4% to RM2.17 billion from RM2.42 billion due to the decrease in average product selling prices.

For the nine-month period, the group’s net profit slumped 67.5% to RM251.98 million from RM776.11 million a year ago, while revenue decreased 6.4% to RM6.46 billion versus RM6.91 billion last year.

Lotte cautioned that average selling prices for polymer products still remained at depressed levels from a year ago which resulted in continued profit margin compression, amid moderating global economic growth with the ongoing market uncertainties.

In addition, reshuffling of global trade flows which resulted in higher supply of cheaper polymers from the US into Asean region also continues to pressure regional product prices.

Nonetheless, its overall plant utilisation achieved 91% during the quarter, highest operational record for the past eight quarters.

The group said the management will continuously seek to maximise profits by focusing on better margin products and emphasising on various plant optimisation programmes to further improve overall efficiency and production.

Lotte president & CEO Lee Dong Woo opined that the group will be able to ride through the current market down-cycle given its healthy financial position with emphasis on long-term strategic expansion plans.

For the expansion plan in Indonesia, he said the front-end engineering design and final feasibility study had been completed and subsequently, it has determined and announced the configuration and specification for the project.

Currently, work for land preparation on project site is underway and the group expects the project tendering and construction to commence in end-2019/2020.

“The integrated petrochemical facility project with a nameplate capacity of one million tonne of ethylene per annum and other value-added downstream derivatives will significantly increase production capacity upon completion by 2023. Over the next five years, the advancement of our company’s growth plan will result in capacity expansion, affirming our position as a top-tier petrochemical company in Southeast Asia”, he explained.

At the noon break, Lotte’s share price gained 4 sen to RM2.52 on 314,400 shares done.

source https://www.thesundaily.my/business/lotte-chemical-s-q3-earnings-fall-58-on-higher-effective-tax-rate-KF1557419

Asian stocks rally after Fed rate cut, BOJ keeps policy steady

TOKYO: Asian shares jumped on Thursday to a three-month high and the dollar fell broadly after the Federal Reserve cut interest rates as expected and U.S. Treasury yields declined.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.68% to the highest since July 30. Hong Kong shares rose 1.16%, while Japan’s Nikkei stock index rose 0.2%.

U.S. Treasury yields slipped in Asia after the rate cut, but Fed Chairman Jerome Powell signalled additional trims are unlikely because there are several areas of strength in the U.S. economy.

The yen held onto gains versus the dollar after the Bank of Japan keep its ultra-easy monetary policy in place as expected and changed its forward guidance to more clearly signal the future chance of a rate cut.

Debate at the Fed and the BOJ highlights the struggle that many central banks are facing.

The U.S.-China trade war and Britain’s divorce from the European Union have increased uncertainty, but central banks are somewhat reluctant to ease policy aggressively because interest rates are already very low in many major economies.

“The biggest thing that stands out is stocks look stronger after the Fed,“ said Tsutomu Soma, general manager of fixed income business solutions at SBI Securities in Tokyo.

“Risks like U.S.-China or Brexit haven’t been resolved completely, but the markets are starting to look beyond these risks.”

U.S. stock futures edged 0.01% higher on Thursday in Asia after the S&P 500 rose 0.33% to close at a record high on Wednesday for the second time in three trading sessions.

A positive mood on Wall Street carried over to Asian equities, except for Australian shares, which fell 0.51% after weak earnings from Australia and New Zealand Banking Group,

The Fed lowered its policy rate to 1.50%-1.75%, but dropped a previous reference in its statement to “act as appropriate” to sustain the economic expansion.

In his news conference, Powell listed several reasons why he feels the economy is doing well, such as robust consumer spending, strengthening home sales, and healthy asset prices.

The yield on benchmark 10-year Treasury notes fell to 1.7785% in Asia on Thursday, while the two-year yield eased slightly to 1.6216%.

The dollar index against a basket of six major currencies fell 0.34% to 97.318, extending declines from Wednesday.

News that Chile will not host the Asia-Pacific Economic Cooperation (APEC) summit in mid-November was one reason the dollar was dented - as the market has been expecting the United States and China to sign a partial trade deal there.

But despite the setback in Chile, Chinese officials voiced optimism that Beijing and Washington can find a way to clinch the so-called Phase One trade deal next month.

The greenback fell to 7.0420 yuan in onshore trade, the lowest since Aug. 19.

The yen rose 0.2% to 108.67 per dollar, holding onto gains after the BOJ left policy unchanged as expected.

Traders will focus on BOJ Governor Haruhiko Kuroda’s press conference later on Thursday to gauge how he assesses the risks posed by the U.S.-China trade war and Brexit.

Optimism that Washington and Beijing will sign a preliminary agreement to call a truce to their trade war was a factor behind the Fed’s decision to signal that further rate cuts are on hold, highlighting the importance of trade talks to global monetary policy.

In the energy market, oil futures erased loses and rose in Asia on Thursday after as a massive buildup in U.S. crude stock piles triggered a decline in futures on Wednesday.

U.S. crude erased loses and rose 0.22% to $55.18 a barrel. Brent crude rose 0.45% to $60.88 per barrel. -Reuters

source https://www.thesundaily.my/business/asian-stocks-rally-after-fed-rate-cut-boj-keeps-policy-steady-AF1557244

US, China top trade negotiators to talk again on Friday

BEIJING: Top US and Chinese trade negotiators will talk again on Friday, China said, as uncertainty swirls over the cancellation of the APEC summit where leaders of the two countries had been expected to meet.

US President Donald Trump said Monday that he expected a “phase one” trade deal with Beijing to be signed on the sidelines of the November summit in Chile, after an 18-month trade impasse between the two economic giants.

But Chile’s President Sebastian Pinera announced Wednesday that his country could no longer host the event, due to violent unrest in the city.

“Negotiating teams on the Chinese and US sides have continued to maintain close communication, and negotiations are currently making smooth progress,“ the Chinese commerce ministry said in a statement Thursday.

“The two sides will continue to push forward negotiations and other work according to the original plan,“ the ministry said, adding that leaders from both sides will hold another call Friday, a week after senior officials last spoke over the phone.

The White House said later on Wednesday that Trump still hopes to sign a trade deal with his Chinese counterpart Xi Jinping in coming weeks.

China and the US have exchanged blows for over a year, with tariffs now impacting hundreds of billions of dollars in two-way trade.

Now with the 2020 presidential election approaching, and Trump under pressure from the impeachment inquiry in Congress, US trade officials have focused on getting a partial deal in the books.

China’s Commerce Ministry said on October 26 that both sides had agreed to “properly address each other’s core concerns. -AFP

source https://www.thesundaily.my/business/us-china-top-trade-negotiators-to-talk-again-on-friday-CF1557150

US Fed cuts interest rates, signals it is on hold

WASHINGTON: The Federal Reserve on Wednesday cut interest rates for the third time this year to help sustain U.S. growth despite a slowdown in other parts of the world, but signaled there would be no further reductions unless the economy takes a turn for the worse.

“We believe that monetary policy is in a good place,“ Fed Chair Jerome Powell said in a news conference after the U.S. central bank announced its decision to cut its key overnight lending rate by a quarter of a percentage point to a target range of between 1.50% and 1.75%.

“We took this step to help keep the economy strong in the face of global developments and to provide some insurance against ongoing risks,“ he said. “We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook.”

Powell’s comments clash with President Donald Trump’s demands that the Fed cut rates even deeper to boost economic growth that ebbed to a 1.9% annual rate in the third quarter, well below the 3% level Trump pledged would flow from a round of tax cuts and other actions nearly two years ago.

But the Fed’s new stance also vouched for both the seeming durability of a U.S. economic expansion that is now the longest on record.

In his news conference, Powell ticked off an extensive list of reasons why he feels the economy is doing well, and likely to continue to do so under the current stance of monetary policy - from robust consumer spending, strengthening home sales, and asset prices he considered healthy but not to a level of excess.

The S&P 500 index closed at another record high on Wednesday.

As well, Powell said, some of the risks that had most unnerved Fed officials, and convinced them lower rates were needed if only as “insurance,“ have seemed to abate in recent weeks.

The U.S.-China trade war was “a step closer” to resolution, Powell said, and it looked less likely that Britain would crash out of the European Union.

The outlook for the U.S. economy continues to be for “moderate” growth, a strong labor market and inflation rising back to the Fed’s 2% annual goal, he said, and only “a material reassessment” of that outlook could drive the central bank to cut rates further from here.

Dissents

In the statement accompanying its decision to cut rates, the Fed dropped a previous reference that it “will act as appropriate” to sustain the economic expansion - language that was considered a sign for future rate cuts.

Instead, the central bank said it will “monitor the implications of incoming information for the economic outlook as it assesses the appropriate path” of its target interest rate, a less decisive phrase.

Kansas City Fed President Esther George and Boston Fed President Eric Rosengren dissented from the decision. They have opposed all three Fed rate cuts this year as unnecessary.

St. Louis Fed President James Bullard, who had dissented in September because he supported a bigger rate cut then, voted with the majority on Wednesday, an indication that views within the Fed may be coalescing around standing pat for now.

The rate cut was widely anticipated by financial markets, but expectations for additional cuts after October have diminished significantly in recent weeks. Contracts tied to the Federal Funds rate indicate an expectation of perhaps one rate cut next year.

While yields on longer-dated bonds showed little reaction, those on shorter-dated maturities that are more closely influenced by Fed policy expectations initially moved higher. The yield on the 2-year note rose to the highest since Oct. 1 at about 1.67% before settling back to earlier levels as Powell spoke.

“It’s pretty much what was expected,“ said Jim Powers, director of investment research at Delegate Advisors.

“The more important outcome is they removed the phrase ‘act as appropriate.’ It looks like the market is taking that to mean that there will be a pause in the declining rate path they were on beforehand. That’s what was expected, and that’s generally a good thing,“ Powers said.

Unusual juncture

The central bank and U.S. economy are at an unusual juncture.

Unemployment is near a 50-year low, inflation is moderate, and data earlier on Wednesday showed economic growth in the third quarter slowed but not as sharply as many economists expected and some Fed officials feared.

But parts of the economy, particularly manufacturing, have stuttered in recent months as the global economy slowed. Businesses have pared investment in response to the U.S.-China trade war that both raised tariffs on many goods, and also made the world a riskier place to make long-term commitments.

While that has not had an obvious impact yet on U.S. hiring or consumer spending, Fed officials felt a round of “insurance” rate cuts was appropriate to guard against a worse outcome. The Fed cut rates in July and again in September, and by doing so hoped to encourage businesses and consumers with more affordable borrowing costs.

The approach was successful in the 1990s when risks developed during another prolonged period of economic growth. -Reuters

source https://www.thesundaily.my/business/us-fed-cuts-interest-rates-signals-it-is-on-hold-KE1556729

Oil prices rise as investors put hopes on China stimulus

TOKYO: Oil prices rose on Thursday as investors banked on more economic stimulus by China after weak PMI data, partly recovering from losses in the previous session on a surprise build in U.S. crude stocks.

Brent crude futures were up 24 cents, or 0.4%, at $60.85 a barrel by 0221 GMT, having fallen earlier in the session. They dropped by 1.6% on Wednesday.

U.S. West Texas Intermediate (WTI) crude futures were up by 10 cents, 0.2%, at $55.16 a barrel. They ended 0.9% lower the previous session.

Factory activity in China shrank for a sixth straight month in October, while growth in China’s services sector activity slowed to the lowest since February 2016, official data showed on Thursday.

“The move up in oil is driven by the expectation that more China stimulus is now on the way after the six-month low in the China manufacturing PMI,“ said Jeffrey Halley, senior market analyst at OANDA.

“The kneejerk response .... was to sell commodities and energy, but central banks globally have itchy trigger fingers at the moment with regards to easing and I believe China will be no different,“ he said.

The U.S. Federal Reserve on Wednesday cut interest rates for a third time this year with the Fed’s stance vouching for the durability of an economic expansion that is now the longest on record.

Rate cuts can often be bullish for oil prices because a stronger economy typically implies higher demand for crude.

Still, prices are likely to be capped until inventories start to show sustained declines.

Crude inventories rose 5.7 million barrels in the week to Oct. 25, the U.S. Energy Information Administration said on Wednesday, compared with analysts’ expectations for a 494,000-barrel build.

On Tuesday, the American Petroleum Institute, an industry group, had reported a 708,000-barrel decline in inventories, raising hopes that official figures would also show a drop.

Crude stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures rose for a fourth straight week, gaining 1.6 million barrels last week, the EIA said.

But gasoline and distillate inventories extended their declines even as refiners ramped up production, it said. - Reuters

source https://www.thesundaily.my/business/oil-prices-rise-as-investors-put-hopes-on-china-stimulus-BE1556650

Bursa Malaysia opens higher in early trade

KUALA LUMPUR: Bursa Malaysia opened higher this morning, in sync with its regional peers as the expected US interest rate cut bolstered investors risk appetite in the global equity markets.

At 9.08am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) gained 0.79 points to 1,580.79 from Wednesday’s close of 1,580.

The key index opened 0.86 points easier at 1,579.14.

Market breadth was positive with gainers trounced losers 149 to 88, while 200 counters were unchanged, 1,555 untraded and 46 others suspended.

Turnover amounted to 162.71 million shares worth RM67.21 million.

Malacca Securities Sdn Bhd, in a note, said although market conditions have become choppier and mixed, the uptrend looked to have been preserved and this could be a prelude for further near-term upsides for the FBM KLCI as it attempts to fortify its position around the 1,580 level.

The positive performance on Wall Street, cheering the latest interest rate cut, could also support the sustained gains on the FBM KLCI and also allow the key index to break out of its range bound trend.

“Nevertheless, we think that the near-term gains are likely to be mild as the buying strength is still on the meek side with the key index poised for targets at 1,583 and 1,590 respectively.

“The supports, on the other hand, are at 1,577 and 1,570 respectively,” it said.

The US Federal Reserve has reduced its key policy rate for the third time this year, by 25 basis points to 1.5-1.75% during the Federal Open Market Committee meeting in October 2019, which concluded on Wednesday.

The US central bank views the economy is slowing down while global uncertainties remain as major downside risks.

Back home, Bursa was mainly supported by interest in the heavyweights, especially among the banking stocks.

Maybank rose six sen to RM8.53, Public Bank chalked up 12 sen to RM19.52, CIMB gained three sen to RM5.12, and Hong Leong Bank increased eight sen to RM17.10.

Petronas Chemicals bagged two sen to RM7.45, while both Tenaga and IHH were flat at RM13.80 and RM5.74.

Of the actives, Kronologi earned six sen to 74 sen, Velesto inched up half-a-sen to 36.5 sen, Jaks improved three sen to RM1.03, but IFCA slipped half-a-sen to 50 sen.

The FBM Emas Index was 9.33 points higher at 11,203.35, the FBMT 100 Index advanced 8.3 points to 11,013.95, the FBM Ace garnered 11.78 points to 4,898.07, and the FBM 70 edged up 22.04 points to 13,894.25.

However, the FBM Emas Shariah Index trimmed 5.17 points to 11,792.56.

Sector-wise, the Financial Services Index perked 49.1 points to 15,369.24, but the Plantation Index lost 16.39 points to 6,654.55, while the Industrial Products & Services Index shed 0.02 point to 153.04.

The physical price of gold as at 9.30am stood at RM194.64 per gramme, up 81 sen from RM193.83 at 5pm yesterday. — Bernama

source https://www.thesundaily.my/business/bursa-malaysia-opens-higher-in-early-trade-EE1556611

Alibaba to resume Hong Kong listing plans as soon as November -sources

HONG KONG/NEW YORK: Alibaba Group Holding Ltd is eyeing a listing in Hong Kong as early as November to raise up to $15 billion, after political unrest put the move on ice earlier this year, people familiar with the matter said on Wednesday.

Alibaba’s listing would boost Hong Kong’s status as a major capital markets hub. After topping global rankings in 2018 for funds raised through IPOs, the city’s bourse fell behind the New York Stock Exchange and Nasdaq this year as a string of pro-democracy demonstrations led to clashes with authorities.

Alibaba plans to seek listing approval from Hong Kong Exchanges and Clearing Ltd shortly after the Chinese e-commerce giant’s online retail frenzy Singles Day on Nov. 11, and may list its shares towards the end of November or in early December, the sources said.

The company expects to be in a position to forgo so-called pre-marketing meetings where it meets with institutional investors before a deal launch given its size and that many investors are already familiar with the company, the sources added. It is hoping to raise between $10 billion and $15 billion through the listing, Reuters has reported.

The sources cautioned that the plans are still subject to market conditions and requested anonymity as the matter is private.

A spokeswoman for Alibaba, which is already listed in New York, declined to comment. The company had been preparing to launch the listing in late August, but delayed it because of the political unrest.

Such a large offering from Alibaba could also have implications on liquidity in Hong Kong’s financial system and the closely watched Hong Kong Interbank Offered Rate (HIBOR), given that investors in the Hong Kong market often borrow funds in anticipation of large share sales.

A rise in HIBOR can in turn lift the Hong Kong dollar , which is pegged to the U.S. dollar at a tight range of 7.75 to 7.85. To defend the peg, the Hong Kong Monetary Authority (HKMA), the city’s de-facto central bank, buys local dollars if it gets too weak and sells to curb excessive strength.

Alibaba follows in the footsteps of brewer AB InBev , which also chose to defy the political turmoil with a listing. In September, it raised about $5 billion by listing its Asia-Pacific unit in Hong Kong. It was the bourse’s biggest and the world’s second-largest IPO so far this year.

Homecoming

Alibaba holds the record for the world’s largest initial public offering with its $25 billion float in New York in 2014.

At that time, the company had initially hoped to float in Hong Kong, but the company’s dual-class share structure clashed with the city’s listing rules. Hong Kong Exchanges & Clearing changed its listing rules last year, primarily with the aim of attracting Chinese technology groups.

Since going public in New York, Alibaba’s shares have more than doubled in value, giving it a market capitalization of around $460 billion.

In August, Alibaba reported better-than-expected quarterly revenue and profit, aided by growth in its e-commerce and cloud computing businesses. -Reuters

source https://www.thesundaily.my/business/alibaba-to-resume-hong-kong-listing-plans-as-soon-as-november-sources-GE1556594

Malaysian financier Jho Low ready to address other issues after US settlement

KUALA LUMPUR: Fugitive financier Jho Low (pix) is ready to address issues related to the 1MDB scandal in Malaysia or elsewhere, a spokesman from the Wells Haslem Mayhew Strategic Public Affairs agency who handles press matters on behalf of Low said on Thursday.

The U.S. Justice Department reached a settlement deal with Low on Wednesday to recover almost $1 billion in funds linked to the scam.

“This agreement with the U.S. government is the result of a multi-year collaborative effort, which has fostered a spirit of cooperation that Mr. Low hopes will continue going forward,“ the spokesman told Reuters.

“If and when Mr. Low is confident that he will be safe and treated fairly, he looks forward to addressing any remaining issues.” - Reuters

source https://www.thesundaily.my/business/malaysian-financier-jho-low-ready-to-address-other-issues-after-us-settlement-YE1556537

Ringgit rise on better demand

KUALA LUMPUR: The ringgit rose against the US dollar in early trading session today due to better demand for the local note amid discouraging economic data from the US, said a dealer.

At 9am, the local note was quoted at 4.1755/1795 versus the greenback from 4.1785/1815 recorded at Wednesday’s close.

Public Investment Bank in a note said a report released by the US Commerce Department on Wednesday showed a less than expected slowdown in US economic growth in the third quarter.

“The slightly slower gross domestic product growth compared to the previous quarter reflected a notable deceleration in consumer spending, which increased by 2.9% in the third quarter after spiking by 4.6% in the second quarter,” it said.

On another development, the abrupt cancellation of Apec Chile 2019 summit next month as social unrest continued to rock the capital city, Santiago had appeared to catch the White House off guard, whilst contributing to a hindrance to the US-Sino trade deal.

Meanwhile, the local note traded mostly lower against other major currencies.

The ringgit was marginally lower against the Singapore dollar at 3.0675/0714 from 3.0672/0699 while gained against the yen to 3.8371/8418 from 3.8381/8419.

The local note declined against the British pound to 5.3918/3987 from 5.3840/3895 and was lower against the euro at 4.6594/6656 from 4.6431/6473. — Bernama

source https://www.thesundaily.my/business/ringgit-rise-on-better-demand-KE1556518

China’s factory activity shrinks for 6th month as trade war clouds outlook

BEIJING: Factory activity in China shrank for the sixth straight month in October and by more than expected, pointing to further pressure on its manufacturers as they grapple with the weakest economic growth in nearly 30 years.

The world’s second-largest economy is facing heightened risks from slowing global demand and the Sino-U.S. trade war, adding pressure on policymakers to roll out more stimulus to avoid a sharper slowdown and bigger job losses.

The Purchasing Managers’ Index (PMI) fell to 49.3 in October, China’s National Bureau of Statistics said on Thursday, versus 49.8 in September. The 50-point mark separates growth from contraction on a monthly basis.

Economists polled by Reuters had expected the reading would be unchanged from September.

Weighed down by cooling domestic demand, sluggish investment and a protracted trade war with the United States, China’s economic growth slowed to a near 30-year low of 6.0% in the third quarter, raising expectations that Beijing will need to roll out more support measures soon.

New export orders fell for the 17th month in a row in October, with the sub-index down to 47.0 from 48.2 in the previous month.

Total new orders, which includes those for export and domestic use, fell back to contractionary territory and erased September’s fleeting growth, suggesting continued weakness in demand at home.

Demand contraction would put a dent on prices and further chip away the already-thin margin for manufacturers. In September, China’s producer prices posted the steepest decline in more than three years, while industrial profits shrank for the second month.

Factories continued to shed jobs in October on weakening demand and rising business uncertainties. The sub-index for employment was at 47.3 in October compared with 47.0 the previous month.

China’s manufacturing sector will remain under pressure in the coming months as the nearly 16-months long Sino-U.S. trade war remains unresolved although Washington and Beijing are working on a first-phase trade accord that could be finalised soon.

“The official PMIs fell by more than expected this month, reinforcing our view that the improvement at the end of Q3 didn’t mark the start of a sustained recovery,“ said Julian Evans-Pritchard, senior China economist at Capital Economics.

He said in a research note that the construction index picked up, suggesting that building activity remained a bright spot, but adding this was overshadowed by a large drop in the index for service sector activity.

Growth in China’s services sector activity slowed in October, pointing to a further weakening in domestic demand.

The official services PMI fell to 52.8 from 53.7 in September, the lowest it has been since February 2016 but still above the 50-mark that separates contraction from expansion, according to a separate NBS survey.

Beijing has been counting on robust services firms to partly offset sluggish domestic and global demand for its manufactured products.

The services sector, which makes up more than 50% of the economy, has been propped up by Chinese consumers’ rising wages and robust spending power in recent years. However, the services sector cooled late last year amid a broader economic downturn.

Analysts expect China’s central bank will ease policy further by cutting banks’ reserve retirement ratios and the one-year loan prime rate (LPR), its new benchmark lending rate.

A Reuters poll showed China’s gross domestic product growth is expected to slow to 6.2% in 2019 and then hit 5.9% in 2020. -Reuters

source https://www.thesundaily.my/business/china-s-factory-activity-shrinks-for-6th-month-as-trade-war-clouds-outlook-FE1556465

Caring Pharmacy posts 2.3% growth in Q1 profit

PETALING JAYA: Caring Pharmacy Group Bhd reported a net profit of RM4.18 million for its first quarter ended Aug 31, 2019 a 2.3% increase from RM4.09 million in the same quarter of the previous year, attributed to the sales generated from the establishment of 16 new outlets.

Its revenue rose 8.9% to RM163.26 million from RM149.97 million.

Caring Pharmacy told Bursa Malaysia that due to the challenging business environment, it will continue to deploy appropriate business strategies to strengthen its operational productivity, digitalise business operations and also adjust its products and marketing strategies in order to maintain its market share.

It said for the quarter under review, the group has established three additional complex outlets and one high street outlet.

source https://www.thesundaily.my/business/caring-pharmacy-posts-2-3-growth-in-q1-profit-XY1551257

Kronologi Asia’s earnings up 35% in third quarter

PETALING JAYA: Kronologi Asia Bhd’s net profit soared 35.3% to RM6.78 million for the third quarter ended Sept 30, 2019 compared with RM5.01 million in the previous corresponding period, underpinned by higher contribution from its operation in India and the acquisition of Sandz Solutions Group.

Revenue for the quarter almost doubled to RM81.66 million from RM41.98 million.

Kronologi’s nine-month net profit rose 34.8% to RM15.53 million from RM11.51 million, while revenue expanded 37.2% to RM166.23 million from RM121.17 million.

According to Kronologi’s filing with Bursa Malaysia, Singapore contributed the bulk of its revenue amounting to RM57.25 million (34.4% of total revenue), followed by the Philippines, Hong Kong and Taiwan which collectively recorded a revenue of RM64.136 million (38.58%).

By product category, enterprise data management (EDM) infra-structure technology segment continued to dominate the group’s revenue amounting to RM155.651 million or 93.63% of total revenue, with EDM managed services making up the balance.

Commenting on prospects, Kronologi said the EDM infra-structure technology business will continue to be an important business driver for the group through continuous innovation of existing and new EDM infrastructure technology solutions and opportunities.

source https://www.thesundaily.my/business/kronologi-asia-s-earnings-up-35-in-third-quarter-EY1551152

Lotte Chemical’s JV to transfer stake in US ethane cracker

PETALING JAYA: Lotte Chemical Titan Holding Bhd’s (LCT) joint venture company Lotte Chemical USA Corp (LC USA) is transferring at least 34.79% stake in LACC LLC to Eagle US 2 LLC for US$816.47 million (RM3.41 billion).

LCT told Bursa Malaysia that LC USA had entered into a securities purchase agreement with Eagle US 2 LLC for the transfer.

LCT and Lotte Chemical Corp own 40% and 60% in LC USA, respectively.

LACC is a joint venture for the development of the US ethane cracker plant with an 88:12 equity split between LC USA and Eagle US, respectively.

The stake transfer arose from Eagle US exercising its call option which allows the company to increase its equity interest in LACC to 50%.

Upon the completion of the transfer, Eagle US’ shareholding in LACC will increase to 46.77% with LC USA holding the remaining 53.23%.

Any additional equity interest Eagle US may receive is subject to finalisation of an audit and further negotiations between the parties concerning the purchase price.

LCT said 25% of the purchase price will be used to pay off the syndicated term loan facility obtained by LC USA to fund the US shale gas project, while the remainder will be used by LC USA for new business plans in the US such as the expansion of plants and downstream business.

LCT expects the transfer to generate a one-off gain on disposal that would have a material impact on the group’s financial statements.

“The transfer will reduce LC USA’s interest in LACC’s future financial performance and consequently, the group’s share of profit and loss in LC USA,” it said.

source https://www.thesundaily.my/business/lotte-chemical-s-jv-to-transfer-stake-in-us-ethane-cracker-EX1550745

Ringgit ends higher against the greenback

KUALA LUMPUR: The ringgit closed higher against the US dollar for the second day in a row, amid a weakening of the greenback ahead of the outcome of the Federal Open Market Committee (FOMC) meeting later today.

At 6pm, the ringgit was quoted at 4.1785/1815 versus the greenback from 4.1810/1850 at close on Tuesday.

AxiCorp Asia Pacific market strategist Stephen Innes said it has been very quiet with the markets trading in narrow ranges as most local traders stayed on the sidelines ahead of the FOMC forward guidance statement later today.

“But it is very challenging to see this range trade mentality changing ahead of the APEC conference in Chile (in November) unless US Federal Reserve (Fed) chairman Jerome Powell surprises the market with a change in the Fed’s data-dependent stance,” he told Bernama.

The FOMC is expected to cut interest rates by 25 basis points, its third cut since July.

Meanwhile, the local note traded mostly lower against other major currencies.

The ringgit strengthened against the yen to 3.8381/8419 from 3.8397/8444 on Tuesday but declined against the Singapore dollar to 3.0672/0699 from 3.0659/0693 yesterday.

It fell against the British pound to 5.3840/3895 from 5.3596/3664 and eased against the euro to 4.6431/6473 from 4.6305/6366. — Bernama

source https://www.thesundaily.my/business/ringgit-ends-higher-against-the-greenback-XX1550716

Bursa Malaysia ends higher after volatile trade

KUALA LUMPUR: Bursa Malaysia ended firmer after volatile trading today, backed by buying in index-linked counters led by CIMB.

At 5pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) finished 2.21 points better at 1,580 from Tuesday’s close of 1,577.79.

The key index, which opened 5.21 points higher at 1,583 this morning, fluctuated between 1,575.33 and 1,583 throughout the day.

CIMB lifted the composite index by 1.028 points, rising six sen to RM5.09 with 15.13 million shares changing hands.

Phillip Capital Management senior vice president (investment) Datuk Dr Nazri Khan Adam Khan said the local market moved higher on US-China trade optimism, coupled with the expectation of a US interest rate cut.

“Investors are perking up, looking for more bullish clues ahead of a crucial US Federal Reserve (Fed) meeting which will end on Wednesday (today) as the central bank is widely expected to lower interest rates at least by another 25 basis points.

“Moreover, the developments of the Sino-US trade talks remained in focus as Washington considers extending specific tariff exclusions on US$34 billion (RM142.13 billion) worth of imports from China,” he told Bernama.

The rate reduction, set to be announced later in the day, would mark the Fed’s third rate cut for this year.

Asian equity markets were mixed with Singapore’s Straits Times Index gaining 0.29% to 3,206.16, Indonesia’s Jakarta Composite Index added 0.23% to 6,295.75, while Japan’s Nikkei 225 fell 0.57% to 22,843.12, and Hong Kong’s Hang Seng Index lost 0.44% to 26,667.71.

On the broader local market, losers outnumbered gainers 469 to 328, while 418 counters were unchanged, 782 untraded and 50 others suspended.

Volume decreased marginally to 2.27 billion shares worth RM1.71 billion from 2.3 billion shares worth RM1.91 billion on Tuesday.

IFCA MSC was the most actively traded stock today, gaining one sen to 50.5 sen with 109.07 million shares done, followed by Velesto which slipped one sen to 36 sen, while Mudajaya rose 13 sen to 34 sen and MyEG fell eight sen to RM1.06.

The FBM Emas Index decreased 5.6 points to 11,194.02, the FBMT 100 Index shed 4.68 points to 11,005.65, the FBM Ace erased 41.83 points to 4,886.29, the FBM Emas Shariah Index declined 18.28 points to 11,797.73, and the FBM 70 was 88.59 points lower at 13,872.21

Sector-wise, the Financial Services Index rose 49.97 points to 15,320.14, but the Plantation Index gave up 22.36 points to 6,670.94 while the Industrial Products & Services Index slipped 0.09 of-a-point to 153.06.

Main Market volume shrank to 1.49 billion shares worth RM1.72 billion from 1.52 billion shares valued at RM1.72 billion on Tuesday.

Warrants turnover decreased to 255.82 million units worth RM39.86 million against 313.59 million units valued at RM60.03 million yesterday.

Volume on the ACE Market narrowed to 519.05 million units worth RM150.05 million compared with 564.46 million units valued at RM131.02 million previously.

Consumer products and services accounted for 209.2 million shares traded on the Main Market, industrial products and services (191.35 million), construction (252.89 million), technology (217.64 million), SPAC (nil), financial services (50.29 million), property (147.78 million), plantations (11.65 million), REITs (9.18 million), closed/fund (87,000), energy (287.65 million), healthcare (24.92 million), telecommunications and media (54.86 million), transportation and logistics (18.59 million), and utilities (18.44 million). — Bernama

source https://www.thesundaily.my/business/bursa-malaysia-ends-higher-after-volatile-trade-EX1550677