HEADLINES

Economy

Global: Economy set to cruise at a solid 3% growth rate next year. Global economic growth will maintain its robust pace next year as major central banks implement a series of interest rate cuts against the backdrop of a strong US economy, according to a Reuters poll of around 500 economists. Inflation has also fallen sharply, with most major central banks now managing price pressures within striking distance or already at their respective targets. Global growth was expected to average 3.1% this year, a steep upgrade from 2.6% in a Jan poll, also up from 2.9% in April and steady compared with a poll three months ago. The world economy's rate of expansion is expected to broadly hold up at 3.0% next year, according to a Reuters poll taken Sept 30 - Oct 30 covering 50 important economies. (Reuters)

US: Consumers keep economy on solid ground ahead of election. The US economy grew solidly in the 3Q, with consumer spending increasing at its fastest pace in 1.5 years and inflation slowing sharply, continuing to defy forecasts of a recession and outperforming its global peers ahead of the Nov 5 presidential election. The Commerce Department's advance estimate of 3Q GDP also showed robust business investment in equipment last quarter. Polls show the race is a toss-up, with the health of the economy the top priority for voters, who have grumbled about high food and housing costs. (Reuters)

US: Weekly jobless claims unexpectedly fall to five-month low. With the more closely watched monthly jobs report looming, the Labour Department released a report showing an unexpected decline by first-time claims for US unemployment benefits in the week ended Oct 26. The report said initial jobless claims fell to 216,000, a decrease of 12,000 from the previous week's revised level of 228,000. Economists had expected jobless claims to inch up to 230,000 from the 227,000 originally reported for the previous week. With the unexpected decrease, jobless claims dropped to their lowest level since hitting a matching figure in the week ended May 18. (RTT)

EU: Eurozone inflation accelerates; jobless rate steady at 6.3%. Eurozone inflation accelerated more than expected in Oct on food and energy prices but it remained within the target of the ECB, bolstering the case for a gradual monetary policy easing. Another official data showed that the euro area unemployment rate remained unchanged at a record low in Sept. The harmonized index of consumer prices posted an annual growth of 2.0%, the flash estimate from Eurostat showed. Inflation was forecast to rise to 1.9% from 1.7% in Sept. Core inflation that excludes energy, food, alcohol and tobacco, remained unchanged at 2.7% in Oct. (RTT)

UK: Inflation-boosting UK budget crimps BOE rate cut bets. Higher inflation fuelled by Britain's new big-spending budget plans is likely to prevent the BOE from cutting interest rates over the next year by as much as investors had expected, further setting it apart from other central banks. New finance minister Rachel Reeves announced the biggest tax increases in three decades in her first budget, saying she needed to spend heavily to repair the country's public services, which she described as "broken". (Reuters)

China: Manufacturing activity expands for the first time in six months. China's manufacturing activity expanded for the first time in six months and services picked up in Oct, indicating that Beijing's latest stimulus measures are helping the battered economy turn a corner. The National Bureau of Statistics PMI rose to 50.1 from 49.8 in Sept, just above the 50-mark separating growth from contraction and beating a median forecast of 49.9 in a Reuters poll. In a further encouraging sign, the non-manufacturing PMI rose to 50.2 this month, after it dropped to 50.0 in Sept. (Reuters)

Japan: BOJ holds rates as unstable politics raise uncertainties. BOJ kept its benchmark interest rate unchanged after uncertainties increased over the outlook for the economy and the stability of the government after the ruling coalition suffered its worst electoral result since 2009. Governor Kazuo Ueda and his fellow board members maintained the unsecured overnight call rate at around 0.25%, according to its statement. The result was expected by all, but one of 53 economists surveyed by Bloomberg. (Bloomberg)

Markets

Bintai Kinden: To be paid RM13.5m as it settles dispute with UIMB. Bintai Kinden Corp's wholly-owned subsidiary Optimal Property Management SB (OPM) has reached an agreement with Universiti Islam Melaka (UIMB) on an extended interim settlement proposal (EISP). The EISP reflects a structured plan to repay OPM, ensuring a clear road map to resolve outstanding obligations by the fully owned subsidiary of the state government. Under the EISP, Bintai Kinden said UIMB has committed to a structured repayment plan amounting to RM13.5m to be paid to OPM by June 30, 2026. (NST)

Duopharma: Secures RM87m additional supply contracts from Pharmaniaga. Duopharma Biotech has secured five additional supply contracts from Pharmaniaga, totalling RM87.66m, to provide 10 pharmaceutical and non-pharmaceutical products to government offices and facilities that Pharmaniaga operates. All additional contracts will remain valid and binding until Dec 31, 2026, or any other date specified by the government. Pharmaniaga's wholly owned subsidiary Pharmaniaga Logistics SB awarded four letters of offer (LOOs) to Duopharma (M) SB, and one LOO to Duopharma Manufacturing (Bangi) SB. (The Edge)

Haily: Bags RM65m housing construction job in Johor. Haily Group has secured a contract worth RM65m for the construction and completion of a housing project in Tebrau, Johor. This comprises 206 units of double-storey terrace houses and one power substation. The contract was secured through its wholly-owned subsidiary Haily Construction SB, which had accepted the Letter of Award for the project from Akipro Architect SB, on behalf of Austin Senibong Development SB. (The Edge)

FGV Holdings: To loan RM260m to subsidiary for capital expenditure. FGV Holdings has entered into a loan agreement with its 72% owned subsidiary, FGV Palm Industries SB (FGVPI), to provide RM260m for financing FGVPI's capital expenditure requirements. FGVPI is a private limited company incorporated in Malaysia on Sept 14, 1955, with an issued share capital of RM422.59m. The principal activities of the company are investment holding, the provision of tolling services related to the processing of fresh fruit bunches into crude palm oil and palm kernel and sale of by-products from the tolling activities. (StarBiz)

SunCon: Accepts RM265m additional works under JHB1X0 project. Sunway Construction Group's (SunCon) wholly-owned subsidiary Sunway Construction SB (SCSB) today accepted RM265m as additional tenant improvement works (TIWs) in respect of variation orders under a contract awarded by Yellowwood Properties SB. Including the previous TIW accepted by SCSB last month, the total sum accepted to date is RM347m. (StarBiz)

MN Holdings: Secures RM63m contract from TNB. MN Holdings' wholly-owned subsidiary MN Power Transmission SB has received a RM63m contract from Tenaga Nasional for the extension of new 1 X 132KV overhead lines battery energy storage system interconnection facilities bay at existing transmission main intake 132/11kV Santong (Air Insulated Switchgear) and new PMU 132/33kV Santong BESS (1x120MVA) (AIS). The group said the contract shall be effective from Oct 30, 2024, and will be completed 540 days from the commencement date. (StarBiz)

MARKET UPDATE

US stocks closed lower on Thursday, with the Dow and S&P 500 cementing their first monthly loss since April as tech stocks sold off sharply and bond yields remained elevated. The policy-sensitive 2-year Treasury yield saw its biggest monthly jump in more than a year as investors and traders focused on the outlook for the US deficit. Dow Jones pulled back 0.9%. S&P 500 and Nasdaq tumbled 1.9% and 2.8%, respectively. Microsoft tumbled after the tech giant's guidance disappointed investors and overshadowed a quarterly earnings beat. Meta dropped more than 4% after the Facebook parent missed the street's expectations for user growth.

European markets also closed lower, ending October with its steepest loss for a year as investors weighed earnings, inflation and a landmark UK budget. The Pan-European Stoxx 600 closed the session 1.2% lower with all sectors and major bourses in the red. It takes monthly losses to 3.4%. Preliminary data published Thursday showed that inflation in the euro zone rose to 2% in October, higher than the consensus expectation of 1.9%. French CAC tumbled 1.1%, as German DAX and the UK's FTSE 100 lost 0.9% and 0.6%, respectively.

Source: PublicInvest Research - 1 Nov 2024