HEADLINES

Economy

US: Treasury's Yellen: inflation will continue to ease over time. Rent and housing costs are keeping U.S. inflation higher than preferred but consumer price pressures will continue to come down over time, Treasury Secretary Janet Yellen said, as a top White House adviser cited what she called "tremendous progress" in bringing down inflation. Yellen told the US House of Representatives Financial Services Committee that inflationary factors including supply issues and labor market tightness have eased, which would help continue to drive down consumer price pressures. (Reuters)

China: GDP recovery likely lost steam in Q2 as consumption sags. China's economy likely grew 5.1% in the second quarter from a year earlier, slowing from a strong start in the first three months due to sluggish consumer demand, keeping alive expectations Beijing will need to unleash more stimulus. While that kind of growth would keep China's full-year target of around 5% in reach, policymakers still need to deal with a protracted property crisis, weak domestic demand, a sliding yuan and trade disputes with the West. GDP in the economy is expected to expand 5.0% in 2024 YoY, according to the median forecast of 82 economists polled by Reuters. (Reuters)

China: June consumer inflation misses forecasts amid anaemic demand. China's consumer prices grew for a fifth month in June but missed expectations, while producer price deflation persisted, with domestic demand mired on a slow recovery track despite support measures for the economy. The consumer price index (CPI) in June rose 0.2% from a year earlier, against a 0.3% uptick in May, the slowest in three months, data from the National Bureau of Statistics showed on Wednesday, below a 0.4% increase forecast in a Reuters poll. (Reuters)

Japan: BOJ to trim growth forecast, project inflation staying around target. The BOJ will likely trim this year's economic growth forecast in July but project inflation will stay around its 2% target in coming years, sources said, keeping alive the chance of an interest rate hike this month. The central bank will release fresh quarterly growth and price forecasts at its next policy meeting on July 30-31, and debate whether to raise rates from current near-zero levels. (Reuters)

Japan: Wholesale inflation picks up as weak yen raises import costs. Japan's wholesale inflation accelerated in June as the yen's declines pushed up the cost of raw material imports, keeping alive market expectations for a near-term interest rate hike by the central bank. Rising global commodity costs and a phase-out of gasoline and fuel subsidies also pushed up wholesale prices, the data showed, a sign of heightening inflationary pressure. (Reuters)

New Zealand: Central bank maintains cash rate, signals potential for future easing. New Zealand's central bank held the cash rate steady at 5.5%, but opened the door to monetary policy becoming less restrictive over time should inflation slow as expected. The decision was in line with the expectations of all economists polled by Reuters, but the Reserve Bank of New Zealand's (RBNZ) accompanying commentary was more dovish than many had anticipated. (Reuters)

Thailand: Finance minister says economy not good, wants relaxed mortgage rules. Thailand's economy is not good and the property sector needs urgent support due to weak demand and rising bad loans, the country's finance minister said on Wednesday. The government was working to lift economic growth to 3% this year from current projections of about 2.5%, Pichai Chunhavajira told a business seminar, adding growth was low compared with rates of close to 6% in the past. "The economy has not been good for a long time, with growth worsening. We have had structural problems," he said. (Reuters)

Markets

Pegasus Heights: SC sues former Naim Indah CEO for alleged insider trading. The Securities Commission Malaysia (SC) has filed a civil suit against Sabah businessman Datuk Raymond Chan Boon Siew for alleged insider trading involving the shares of Naim Indah Corp, now known as Pegasus Heights. SC claimed that Chan breached the Capital Markets and Services Act 2007 as he had communicated insider information to Datuk Lim Thiam Huat — managing director and substantial shareholder of pulp and paper manufacturer Nextgreen Global where he has 13.06% stake. (The Edge)

Haily: Proposes one-for-one bonus issue with free warrants. Haily Group said it plans to reward its shareholders with a bonus issue of one new share for every share held. This will be followed by a free warrant issue on the basis of one warrant for every two shares held by which the warrant will have a tenure of three years. The entitlement date for the bonus issue will be determined later and the warrants' entitlement date will be announced after the completion of the bonus issue. (The Edge)

MUI Properties: Unit to sell freehold land in Port Dickson for RM81m cash. MUI Properties in which Malayan United Industries owns a 23.48% stake, is selling 53 acres of freehold land in Port Dickson, Negeri Sembilan, for RM80.8m cash. Its wholly owned subsidiary Peristal Enterprise SB via its 60%-owned unit West Synergy SB entered into a sale and purchase agreement with Antmed Malaysia SB for the disposal of the land located at Bandar Springhill. MUI is expecting to gain RM16.6m (before tax and noncontrolling interest) from the proposed disposal, which is scheduled to be completed in the fourth quarter of 2025. (The Edge)

Annum: Secures RM53m contract to supply material, labour for office building construction. Annum said it has been awarded a sub-contract worth RM53.2m by Iqzan Holding to supply material, labour and machinery for the construction of an office building in Jalan Tun HS Lee. The two-year sub-contract was awarded by Iqzan's subsidiary Kacon Construction SB. (The Edge)

Econpile: Gets RM27m earthworks job for Mont Kiara condo project. Econpile Holdings has secured a RM26.5m contract to undertake piling, earthworks and sub-structure works for a 40- storey condominium project in Mont Kiara. The contract was awarded by SNA Consult SB on behalf of Modern Plus SB. (The Edge)

PTT Synergy: In RM26m factory disposal. PTT Synergy Group (PTTS) is disposing of two units of three-storey detached factories in Sepang, Selangor to MCM Land SB for a total cash consideration of RM26m. PTTS said the proposed disposal is deemed part of PTTS’ plan to rationalise its non-core assets. “PTTS is principally involved in the business of construction contractors and property investment. (StarBiz)

AppAsia: To diversify into semiconductors. AppAsia is diversifying into the semiconductor business by inking a MoU with CMSC Inc, a Taiwanese integrated circuit (IC) design services provider. Under the MoU, AppAsia planned to establish a special purpose venture entity to explore business opportunities in IC production, including IC design covering, IC front-end and backend design and turnkey solutions, the company said. (Bernama)

MARKET UPDATE

The FBM KLCI might open higher today after Wall Street’s blistering rally stretched into a seventh day Wednesday and vaulted the US stock market to more all-time highs. The S&P 500 jumped 1% and topped the 5,600 level for the first time. The Nasdaq composite also rallied to a seventh straight gain and added 1.2% to its all-time high set a day before. The Dow Jones Industrial Average, meanwhile, swung 429 points higher, or 1.1%. Big technology companies led the way, as has become the norm on Wall Street, and Taiwan Semiconductor’s US-listed shares rose 3.5% after it said its revenue climbed nearly 33% in June from a year earlier. In elsewhere, Japan’s Nikkei 225 rose 0.6% to close at its own record. It’s jumped 25% so far this year, even more than the US stock market, as AI enthusiasm has pushed up its technology stocks. Its exporters are also benefiting from the yen’s falling value against the dollar, which can boost their profits. Other markets in Asia were mixed, while European indices climbed with Stoxx 600 rose 0.9%. Back home, Bursa Malaysia continued its upward momentum to end higher for the second consecutive day on Wednesday as gains were largely supported by buying interest in selected banking, utilities, and plantation heavyweights. At the closing bell, the FBM KLCI rose 3.96 points to 1,618.38 from Tuesday’s close of 1,614.42.

Source: PublicInvest Research - 11 Jul 2024