PublicInvest Research

Author: PublicInvest   |   Latest post: Wed, 12 May 2021, 9:06 AM


PublicInvest Research Headlines - 9 Apr 2021

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US: Weekly jobless claims rise again, but labor market recovery gaining steam. The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, but the increase likely understated the rapidly improving labor market conditions as more parts of the economy reopen and fiscal stimulus kicks in. The second straight weekly increase in claims reported by the Labor Department was at odds with reports this month showing the economy created 916,000 jobs in March, the most in seven months. (Reuters)

US: States project rosier revenue as economy heats up. US states are pumping up their revenue forecasts amid higher tax collections that reflect improving economic conditions spurred by fiscal stimulus measures and eased coronavirus pandemic restrictions. Revenue has been gaining steam even as states are set to receive a new round of federal aid. February tax collections were nearly 16% higher than in Feb 2020, the month before states began taking steps to slow the virus’ spread. (Reuters)

US: Fed minutes reiterate policy likely to remain unchanged for some time. T he minutes from the Federal Reserve's latest monetary policy meeting indicated the central bank is unlikely to change its ultra-loose monetary policy anytime soon. Participants in the March meeting acknowledged the improvement in the medium-term outlook for real GDP growth and employment but continued to see the uncertainty surrounding that outlook as elevated. The minutes showed most participants still viewed the coronavirus pandemic as risks. (RTT)

EU: House prices rise most since 2006. Eurozone house prices rose at the fastest pace nearly two decades in the 4Q2020, data from Eurostat showed. House prices increased 5.4% YoY after a 4.9% rise in the previous quarter. The rate of growth was the fastest since the 4Q of 2006. (RTT)

EU: Producer price inflation rises in Feb. Eurozone producer prices increased at a faster pace in Feb, data from Eurostat showed. Producer prices rose 1.5% YoY, following January's 0.4% increase. Economists had forecast producer price inflation to climb to 1.4%. On a monthly basis, producer prices gained 0.5%, but slower than the 1.7% increase posted in Jan. Prices were expected to rise 0.6%. Excluding energy, producer price inflation advanced to 1.2% annually in Feb from 0.7% in Jan. (RTT)

EU: Policymakers saw recent bond yield rise premature, ECB minutes show. Policymakers saw the recent rise in bond yields was largely premature for the euro area and that warranted the maintenance of an ample degree of stimulus, the minutes of the European Central Bank's March 10-11 meeting showed. The recent tightening of financing conditions was generally seen as premature for the euro area, which was still in a weaker cyclical position than the US. The ECB staff projections in March were largely unchanged from Dec. (RTT)

EU: Strong domestic demand propels German industrial orders. German industrial orders rose for the second month in a row in Feb driven by strong domestic demand, data showed in a further sign that manufacturers are set to cushion a pandemic-related drop in overall output in the 1Q. The growth outlook for Europe’s largest economy remains clouded, however, by a more contagious virus variant and rapidly rising Covid-19 cases that could force authorities to tighten restrictions again in the coming weeks. (Reuters)

UK: Hiring improves strongly on lockdown easing plans - survey. UK recruitment activity improved sharply in March on hopes of a return to normal operations as the government announced plans to ease the coronavirus pandemic-linked lockdown measures. Permanent placement growth hit a near six-year high, while temp billings expanded at the quickest rate since November 2017, results of the latest KPMG and REC, UK Report on Jobs survey showed. IHS Markit collected the survey data from March 12 to 25. (RTT)

UK: Card spending rises to highest since Christmas. British households’ spending on credit and debit cards rose strongly to 88% of its pre-pandemic average in the week to April 1, its highest since the week before Christmas, the Office for National Statistics said. The figures are not seasonally adjusted, and the ONS said some of the increase was driven by end-of-month spending on households’ bills and food shopping. But they add to signs that the economy is beginning to pick up as coronavirus restrictions being to ease. (Reuters)

Japan: Eco watchers current condition increases, outlook falls. A measure of the public assessment of the Japanese economy increased in March, survey data from the Cabinet Office showed. The current conditions index of the Economy Watchers' Survey, which measures the current situation of the economy, increased to 49.0 in March from 41.3 in Feb. In Jan, the reading was 31.2. The outlook index that signals future activity fell to 49.8 in March from 51.3 in the previous month. In Jan, the reading was 39.9. (RTT)

Taiwan: Inflation eases in March. Taiwan's consumer price inflation eased in March, data from the Directorate-General of Budget, Accounting and Statistics showed. The consumer price index increased 1.26% YoY in March, after a 1.4% growth in Feb. Economists had expected the inflation to remain unchanged at 1.4%. Prices for fuels and lubricants grew 17.08% yearly in March and those of transportation gained 11.68%. (RTT)


Maybank: (Neutral, TP: RM8.80): Did not proceed with baht bond issuance as it secured more cost-effective funding. Malayan Banking investment banking arm Maybank Kim Eng Group confirmed Maybank Kim Eng Securities (Thailand) Pcl has cancelled its proposed baht-denominated bonds, as it had secured a more cost-effective source of funding. (The Edge)

KUB Malaysia: Sells loss-making plantation unit to Syed Mokhtar’s Tradewinds Plantation. KUB Malaysia will be selling its loss-making plantation unit, KUB Malua Plantation SB, to Tradewinds Plantation, the plantation arm of Tan Sri Syed Mokhtar's business empire for RM10m cash. According to KUB's annual report for the financial year ended Dec 31,2019 (FY19), KUB Malua owns 1,534 ha of plantation land in Kinabatangan. (The Edge)

Datasonic: Short tenure for Datasonic’s two substantial shareholders . Newly appointed Datasonic Group executive director Safian Mohd Yunus has ceased to be a substantial shareholder in the company after just one month following a recent private placement exercise. Concurrently, the private placement of 262m shares or 8.8% of Datasonic’s enlarged share capital also resulted in Titian Tegap SB ceasing to be a substantial shareholder in Datasonic, less than five months after its emergence on the list. (The Edge)

MSM: Suspends Johor sugar refinery operations for two months . MSM Malaysia Holdings has announced a temporary production shutdown of its refinery at MSM Sugar Refinery (Johor) SB (MSM Johor) for two months, effective March 31. The sugar producer said the move is to enable the rectification of MSM Johor’s boiler following a breakdown. Upon completion, the plant is expected to be able to achieve its targeted utilisation factor by the third quarter of this year. (Bernama)

MMC: Sees higher demand for cargo storage at PTP after Suez Canal blockage , MMC Corp Bhd has benefitted from higher demand for cargo storage space at its Port of Tanjung Pelepas in Johor, which is operated by its unit Pelabuhan Tanjung Pelepas SB, due to the recent blockage at the Suez Canal caused by a trapped container ship. Group MD Datuk Seri Che Khalib Mohamad Noh said the port was able to accommodate requests for temporary cargo storage. (The Edge)

AME: Receives shareholders nod approve for RM434.3m land acquisition in Iskandar region . AME Elite Consortium shareholders has approved the acquisition of 169.8 acres of land at SiLC in Iskandar Puteri, Johor Bahru for RM434.3m, which would increase its balance available industrial landbank to 231 acres in total. With the acquisition now approved, AME plans to launch a new integrated industrial park on the new lands in the second half of 2021, with a gross development value (GDV) of about RM1.5bn. (NST)

Aeon Credit: Posts lower net profit of RM233.96m. Aeon Credit posted a lower net profit of RM233.96m for the financial year ended Feb 28,2021 (FY2021) from RM292.05m a year ago. Revenue also declined to RM1.56bn from RM1.60bn in the preceding year. (Bernama)

Market Update

Investors shrugged off an unexpected jump in initial jobless claims numbers to power markets to fresh highs, with technology stocks leading the gains. Treasury yields also retreated from their recent highs with yields of 10-year papers hovering around 1.6%. On the day, the Dow Jones Industrial Average and S&P 500 inched 0.2% and 0.4% higher respectively. The Nasdaq Composite was the outperformer with a 1.0% gain as Amazon, Netflix, Microsoft and Google-parent Alphabet all closed higher. Separately, US Federal Reserve (FED) Chairman Jerome Powell called the recovery from the pandemic “uneven”, signaling a more robust recovery is needed. Over in Europe, markets were mostly higher as investors here reacted positively to the FED’s meeting minutes which suggested that officials plan to keep the pace of asset purchases the same for some time. On the data front, German industrial orders rose in February on the back of strong domestic demand. UK’s FTSE 100 and France’s CAC 40 rose 0.8% and 0.6% while Germany’s DAX inched 0.2% higher. Asian markets were mostly higher overnight in reaction to the positive performance on Wall Street the day before, while also being encouraged by the FED’s commitment to supportive policy. Japanese shares were lower however amid concerns that the government is planning stricter steps to curb rising virus infections, the Nikkei 225 slipping 0.1%. The Shanghai Composite and Hang Seng indices rose 0.1% and 1.2%.

Axiata Group and Telenor Asia are in “advanced discussions” to merge the telco operations of Celcom Axiata and Digi.Com. LBS Bina Group has signed an agreement with the Melaka government to reclaim and develop land spanning 1,200 acres in Tanjung Bruas. KUB Malaysia will be selling its loss-making plantation unit to Tradewinds Plantation for RM10m cash.

Source: PublicInvest Research - 9 Apr 2021

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