HEADLINES

Economy

US: 30-year fixed-rate mortgage falls to 6.60%. US mortgage rates dropped to the lowest level in nearly two months this week, a trend that if sustained could boost home sales in the coming months. The average rate on the popular 30-year fixed-rate mortgage fell to 6.60%, the lowest level since the week ending Oct. 24, from 6.69% last week, mortgage finance agency Freddie Mac said. It has now declined for three straight weeks. The rate averaged 6.95% during the same period a year ago. The combination of mortgage rate declines, firm consumer income growth and a bullish stock market have increased homebuyer demand in recent weeks. (Reuters)

US: Eggs boost US producer prices in Nov, but services inflation slowing. US producer prices increased by the most in five months in Nov, but easing costs of services such as portfolio management fees and airline fares offered hope that the disinflationary trend remains in place despite stalled progress. A surge in the price of eggs amid an avian flu outbreak accounted for much of the bigger-than-expected rise in producer inflation last month. Other details of the report from the Labor Department were, however, mostly favorable, prompting economists to sharply lower their estimates for the personal consumption expenditures (PCE) price measures tracked by the Federal Reserve for its 2% inflation target. (Reuters)

US: Weekly jobless claims unexpectedly extend rebound. First-time claims for US unemployment benefits unexpectedly increased in the week ended Dec 7th, according to a report released by the Labor Department. The report said initial jobless claims climbed to 242,000, an increase of 17,000 from the previous week's revised level of 225,000. Economists had expected jobless claims to dip to 220,000 from the 224,000 originally reported for the previous week. Jobless claims increased for the second consecutive week, continuing to regain ground after hitting their lowest level in over six months. (RTT)

EU: Set to aid waning economy with fourth rate cut. The European Central Bank is set to cut interest rates for the fourth time this year, loosening constraints on the region's struggling economy as inflation nears 2%. Officials are certainly worried about the economic trajectory, with some fretting that persistent sluggishness could drag inflation below target. They're also grappling with government collapses in Germany and France, and are trying to gauge how Donald Trump's economic agenda will impact not just Europe, but also the Federal Reserve. But against that backdrop, there's a preference to lower borrowing costs only gradually. (Bloomberg)

EU: Turkey current account surplus shrinks in Oct. Turkey's current account surplus decreased at the start of the final quarter, data published by the Central Bank of the Republic of Turkey. The current account surplus decreased to USD1.88bn from USD3.01bn in Sept. The deficit on trade in goods totalled USD3.54bn, up from the USD3.12bn shortfall a month ago, as imports grew faster than exports. The surplus on services trade shrank to USD6.45bn from USD7.37bn in Sept. Under services, travel items recorded a net inflow of USD5.1bn. Primary income showed a shortfall of USD1.05bn, smaller than the prior month's USD1.22bn deficit. At the same time, the secondary income turned into a surplus of USD20m after posting a deficit of USD17m. (RTT)

EU: Italy jobless rate falls to 6.1% in Q3. Italy's unemployment rate declined further in the three months ended Sept, data published by the statistical office Istat showed. The seasonally adjusted jobless rate dropped to 6.1% in the third quarter from 6.7% in the previous quarter. In the corresponding period last year, the unemployment rate was 7.7%. Meanwhile, the inactivity rate among the 15 to 64 age group rose marginally to 33.4% from 33.2%. Data also showed that the employment rate stood at 62.4% versus 62.2% in the previous quarter. (RTT)

Japan: Large Manufacturers Index +14 In Q4, Outlook +13. Large manufacturing in Japan accelerated slightly in the third quarter of 2024, the Bank of Japan's quarterly Tankan Survey of business sentiment showed with a diffusion index score of +14. That beat forecasts for a reading of +13, which would have been unchanged from three months earlier. The outlook came in at +13, easing from +14 in the previous quarter. The large non-manufacturers index came in at +33, beating forecasts for +28 and down from +34. The outlook was +28, down from +33 three months earlier. The medium manufacturing index was at +11 with an outlook of +8, while the medium non-manufacturing index was at +22 with an outlook of +15. The small manufacturing index was at +1, while the small non-manufacturing index was at +16. Large industry capex is seen higher by 11.3%, beating forecasts for 9.6% and up from 10.6% in Q3. (RTT)

India: Consumer price inflation eases; industrial output growth improves. India's inflation eased more than expected in Nov from a 14-month high in the previous month amid a slowdown in food prices, while industrial production expanded at a slightly faster pace in Oct, separate reports from the National Statistical Office showed. Consumer price inflation softened to 5.48% in Nov from 6.21% in Oct. Economists had expected inflation to slow to 5.53%. In the same period last year, inflation was 5.55%. With this, consumer price inflation came below the lower band of the 2-6% target. Food inflation moderated to 9.04% in Nov from 10.87% in the previous month. (RTT)

Hong Kong: Industrial production falls 0.1% in Q3. Hong Kong's industrial production contracted in the third quarter, provisional data from the Census and Statistics Department showed. The index of industrial production for manufacturing industries as a whole declined 0.1% yearly in the third quarter, in contrast to a 0.7% gain in the second quarter. On a quarterly basis, industrial production remained broadly unchanged in the Sept quarter. Food, beverages, and tobacco production fell 2.7% from last year, and that of paper products, printing, and reproduction of recorded media decreased by 4.6%. Meanwhile, production of textiles and wearing apparel grew 5.8%. (RTT)

Markets

GDB: Clinches RM298m logistics warehouse contract in Klang. GDB Holdings, through its subsidiary Grand Dynamic Builders SB, has secured a RM298m design-and-build contract from SDPLOG 1 (Industrial Asset III) SB for the construction of the Metrohub 4 logistics warehouse in Klang, Selangor. The 20-month project, slated for completion by Aug 2026, will add to GDB's growing order book, now valued at RM1.4bn. The project will feature a 153,120 sq m warehouse, sustainable building practices, and aims for LEED Gold certification. (The Malaysian Reserve)

Kitacon: Bags jobs from PKNS, Gamuda unit. Kumpulan Kitacon has won two jobs worth RM203.9m cumulatively to build residential properties for Perbadanan Kemajuan Negeri Selangor (PKNS) and Gamuda's unit, Bandar Serai Development SB. PKNS awarded a RM60.9m main building works contract to Kitacon for 218 units of townhouses with other amenities in Selangor Cyber Valley, Sepang. "The contract shall commence on Jan 20, 2025 and is to be completed within 104 weeks from the commencement date," Kitacon said. (StarBiz)

Solarvest: Inks MoU with Vista Contracting for solar projects in Malaysia, Brunei, Taiwan, and Cambodia. Solarvest Holdings has today entered into a MoU with Vista Contracting and Investment Global Pte Ltd, to explore collaboration opportunities in developing rooftop and utility-scale solar projects across Malaysia, Brunei, Taiwan, and Cambodia. However, detailed agreements regarding each project will be finalised through further negotiations. The MoU is valid for two years from the effective date and could be terminated early under specific conditions, including mutual agreement or a breach of terms. (The Malaysian Reserve)

Paramount: To buy KL land for RM145m. Paramount Corp's wholly owned subsidiary, Tanah Bayumas SB, has struck a deal to acquire the luxury condominium villas known as Brunsfield Residence and 18,317 sq m of leasehold land from Prismaworld Embassyview SB for RM145m. The company announced plans to launch a new development on the acquired land, aiming to replicate the success of its two existing high-end residential projects in the vicinity, The Atrium and The Ashwood. (StarBiz)

MNRB: Appoints Rudy Rodzila as interim president, group CEO. Datuk Rudy Rodzila Che Lamin has been appointed as the interim president and group CEO of MNRB Holdings, the holding company of wholesale providers of reinsurance and re-takaful as well as two takaful operators. The appointment, announced on Dec 3, comes following Zaharudin Daud's completion of his tenure at the reinsurance company. Rudy Rodzila, who currently serves as the president/CEO of Takaful Ikhlas General, assumed the role effective Nov 23. (The Malaysian Reserve)

Hong Seng: Receives legal notice from Hong Seng Group on trademark usage. Hong Seng Consolidated (HSCB) said it received a legal notice from the Hong Seng Group of Companies, led by Dato Seri Teoh Hai Hin, demanding that the company cease using the "Hong Seng" name and "HS" trademark. This notice comes despite HSCB having previously received consent from Teoh Hai Hin to use these trademarks. Teoh serves as HSCB's executive chairman and MD. The company is currently seeking legal advice on the matter and will provide further updates if any significant developments arise. (The Malaysian Reserve)

MARKET UPDATE

The KLCI might open lower today after US stock indices fell Thursday following some potentially discouraging data on the economy. The S&P 500 slipped 0.5% for its fourth loss in the last six days. It's a pause for the index, which has been rallying toward one of its best years of the millennium. The Dow Jones Industrial Average lost 234 points, or 0.5%, and the Nasdaq composite sank 0.7% from its record set the day before. A report early in the morning said more US workers applied for unemployment benefits last week than expected. A separate update, meanwhile, showed that inflation at the wholesale level, before it reaches US consumers, was hotter last month than economists expected. Neither report points to imminent disaster, but they dilute one of the hopes that's driven the S&P 500 to 57 all-time highs so far this year: Inflation is slowing enough to convince the Federal Reserve to keep cutting interest rates, while the economy is remaining solid enough to stay out of a recession. In stock markets elsewhere, European indices held relatively steady following the European Central Bank's cut to rates. Asian markets were stronger. Indexes rose 1.2% in Hong Kong and 0.8% in Shanghai as leaders met in Beijing to set economic plans and targets for the coming year. South Korea's Kospi rose 1.6% for its third straight gain of at least 1%, as it pulls back following last week's political turmoil where its president briefly declared martial law. Back home, the KLCI dropped 1.12 points or 0.07% to 1602.08.

Source: PublicInvest Research - 13 Dec 2024