HEADLINES

Economy

US: Fed steaming toward Sept rate cut, minutes from meeting show. The Federal Reserve appears to be very much on track for an interest rate cut in Sept after a vast majority of officials said such an action was likely, according to the minutes of the US central bank's July 30-31 meeting. The minutes, which were released, even showed some policymakers would have been willing to reduce borrowing costs at last month's gathering. (Reuters)

US: Nonfarm payroll growth revised down by 818,000, Labor Department says. The US economy created 818,000 fewer jobs than originally reported in the 12-month period through March 2024, the Labor Department reported. As part of its preliminary annual benchmark revisions to the nonfarm payroll numbers, the Bureau of Labor Statistics said the actual job growth was nearly 30% less than the initially reported 2.9 m from April 2023 through March of this year. The revision to the total payrolls level of -0.5% is the largest since 2009. (CNBC)

US: Job growth in year through March was far lower than estimated. US employers added far fewer jobs than originally reported in the year through March, the Labor Department said, underscoring the growing concerns the Federal Reserve has about the health of the labor market as it gears up to start cutting interest rates in Sept. The department's estimate for total payroll employment for the period from April 2023 to March 2024 was lowered by 818,000. (Reuters)

EU: Latvia producer prices fall 2.9%. Latvia's producer prices continued their declining trend in July, figures from the Central Statistical Bureau showed. The producer price index fell 2.9% YoY in July, faster than the 1.9% decrease in June. Prices have been rising since June 2023. Among components, prices for electricity, gas, steam, and air conditioning supply declined the most, by 13.0% annually in July, and those for mining and quarrying dropped by 3.3%. (RTT)

EU: Estonia producer prices rise 0.8% in July. Estonia's producer prices increased for the first time in fourteen months in July, figures from Statistics Estonia showed. The producer price index rose 0.8% YoY in July, reversing a 0.5% decrease in June. The producer price index was most affected by price increases in the manufacture of electronic products, the repair of machinery and equipment, and the manufacture of fuel oils, the agency said. (RTT)

EU: Poland industrial production grows; producer prices fall further. Poland's industrial production increased less than expected in July after remaining stagnant in the previous month, while producer prices continued their steep falling trend, separate reports from Statistics Poland revealed. Industrial production rose 4.9% YoY in July, following a flat change in June. Meanwhile, economists had expected 7.3% growth for the month. (RTT)

South Korea: Business confidence weakens in Aug. Business sentiment in South Korea decreased in Aug to the lowest level in five months, while the outlook improved, the latest survey from the Bank of Korea showed. The Business Survey Index on business conditions in the manufacturing sector dropped to 71 in Aug from 73 in July. Further, this was the lowest score since March. The subindex for new orders fell to 77 from 81, and that for production decreased to 84 from 85. (RTT)

Indonesia: Central bank keeps rates steady, focuses on stabilizing the rupiah. Indonesia's central bank held interest rates steady, as expected, preferring to focus on stabilizing the rupiah before possibly easing rates later this year. Bank Indonesia (BI) kept the benchmark 7-day reverse repurchase rate, opens new tab at 6.25%, where it has been since April, as expected by all 30 economists polled by Reuters. BI also kept the overnight deposit facility, opens new tab and lending facility, opens new tab rates unchanged at 5.50% and 7%, respectively. (Reuters)

Markets

Glomac: Plans to raise up to RM3bn via sukuk programme. Glomac plans to raise up to RM3bn through a sukuk wakalah programme to finance land acquisition, refinance debts and fund capital expenditure. The property developer said it completed the lodgement of the programme with the Securities Commission Malaysia. The first issuance under the programme, which is unrated and has a perpetual tenure, is expected within 90 business days, with each sukuk having a tenure of more than one year. (The Edge)

Tuju Setia: Bags RM248m job in Selangor. Tuju Setia’s wholly owned subsidiary Pembinaan Tuju Setia SB has accepted a RM248m contract from Sime Darby Property (SJ7) SB, a unit of Sime Darby Property, for the proposed construction of the Hype Residences in USJ7, Subang Jaya, Selangor. The group said that the project comprises two towers with 35 levels of business service apartments each as well as one mechanical floor and a five-level podium carpark. The contract is for a duration of 33 months. (StarBiz)

Powerwell: Bags contract to supply electrical low-voltage switchboards for data centre. Powerwell Holdings said it had secured a RM14.8m contract to supply electrical low-voltage switchboards from "a leading international contractor" for a data centre in Malaysia. The group did not provide further details of the contractor and the data centre. "The supply contract is expected to be fulfilled by the third quarter of calendar year 2024," said Powerwell, adding that the contract is expected to contribute positively to its earnings and net assets for FYE 31 March 2025. (The Edge)

JcbNext: Sells more shares in Taiwan-listed 104 Corp. Digital marketing and advertising services firm JcbNext has continued to trim its stake in Taiwan-listed company 104 Corp, as it seeks to diversify its investment portfolio and reduce concentration risk. JcbNext disposed of a total of 549,029 shares in 104 Corp between 16 May and 21 Aug for TWD128m, or about RM18.4m, the company said. "Based on the disposal consideration, the expected net gain arising from the disposal is RM10.5m" the company said. (The Edge)

Ranhill Utilities: Hamdan Mohamad vacates GCEO post. Ranhill Utilities’ group CEO Tan Sri Hamdan Mohamad, 68, has resigned from the company with immediate effect. Ranhill said this follows Hamdan’s resignation as executive chairman and director of the company on 2 Aug after YTL Power International and a company it owns a majority stake in, SIPP Power SB, completed its takeover of Ranhill. YTL Power and SIPP Power launched a mandatory general offer on 9 July for Johor-based Ranhill, after it obtained a controlling stake of 53.2%. (StarBiz)

YTL Corp: Remains resilient amid challenges. YTL Corp expects the performance of its business segments to remain resilient, going forward, as its major business segments are substantially engaged in essential services. The company said it will continue to closely monitor the related risks and impact on all its business segments. In 4Q24 net profit slipped to RM534.5m compared with RM548m in the previous corresponding period, while revenue in 4Q24 dipped to RM8.3bn from RM9.2bn a year earlier. (StarBiz)

MARKET UPDATE

The FBM KLCI might add a few points at opening today as US stocks ticked higher Wednesday after more big companies delivered profit reports that topped analysts’ expectations. The S&P 500 rose 0.4% a day after breaking an eight-day winning streak, its longest of the year. The index is back to within 0.8% of its all-time high set last month. The Dow Jones Industrial Average added 55 points, or 0.1%, while the Nasdaq composite gained 0.6%. Treasury yields eased a bit in the bond market as investors wait for the week’s main event, which will arrive Friday. That’s when Federal Reserve Chair Jerome Powell will give a speech at an annual economic symposium. The hope is he’ll offer clues about how deeply and quickly the Fed will begin cutting interest rates next month after it jacked them to a two-decade high to beat inflation. In stock markets elsewhere, indices were mixed. Japan’s Nikkei 225 slipped 0.3%. It was a much more modest move than some of its huge swings in recent weeks, including its worst day since the Black Monday crash of 1987. Back home, Bursa Malaysia ended lower as profit-taking persisted following the recent strong rally, with key regional indices also trending downwards, influenced by negative cues from Wall Street overnight. At the close, the FBM KLCI slid 7.45 points or 0.45% to 1,635.32 from yesterday’s close of 1,642.77.

Source: PublicInvest Research - 22 Aug 2024