HEADLINES

Economy

US: Weekly jobless claims hit eight-month low as labour market remains resilient. The number of Americans filing new applications for unemployment benefits dropped to an eight-month low last week, pointing to low layoffs at the end of 2024 and consistent with a healthy labour market. The report from the Labour Department added to a recent raft of upbeat economic data, including consumer spending, in reinforcing the Fed's projections for fewer interest rate cuts this year. (Reuters)

EU: Poland's manufacturing PMI falls in Dec but outlook improves. Poland's manufacturing sector saw a further decline in Dec, with the PMI dropping to 48.2 from 48.9 in Nov, marking the strongest deterioration since Aug, S&P Global reported. Analysts polled by Reuters had expected a reading of 48.6. A reading below 50 indicates a contraction in activity, while above 50 signals growth. (Reuters)

EU: Private sector credit growth weakens. Lending to the euro area private sector weakened in Nov, data released by the ECB showed. Adjusted loans to the private sector grew at a slower pace of 1.5% after rising 1.7% in Oct. Among the borrowing sectors, adjusted loans to households climbed 0.9% compared to 0.8% in Oct. Meanwhile, growth in loans to businesses softened to 1.0% from 1.2%. (RTT)

UK: Factories report sharpest contraction in nearly a year, PMI shows. British factory activity shrank at the fastest pace in 11 months in Dec and manufacturers cut staffing levels due to higher taxes and weak foreign demand, a survey showed, the latest in a string of weak readings on the economy. The S&P Global UK Manufacturing PMI sank to 47.0 from 48.0 in Nov and was below a preliminary reading for Dec of 47.3. (Reuters)

China: Manufacturing sector growth softens in Dec. China's manufacturing sector expanded at a softer pace in Dec largely due to weaker foreign demand, survey results from S&P Global showed. The Caixin manufacturing PMI posted 50.5 in Dec, down from 51.5 in Nov. The score was expected to climb to 51.6. The survey showed that conditions in the manufacturing sector improved for a third straight month but the pace of growth eased since Nov. The official PMI data released earlier this week showed that the manufacturing sector expanded only marginally in Dec. (RTT)

Markets

Awantec: Gets one-year extension to cloud services contract with government. Awanbiru Technology's (Awantec) unit Awantec Systems SB has secured a one-year extension to its cloud framework agreement (CFA 1.0) with the government. The company is responsible for managing and delivering Google cloud services to the government. The extension will be effective from 1 Jan until 31 Dec or until the availability of CFA 2.0, whichever comes earlier, it said. The cloud-based service provider initially entered into the agreement with the Malaysian Administrative Modernisation and Management Planning Unit (Mampu) and Google Cloud Malaysia SB in March 2022, to provide the specified service for up to 35 months until 31 Dec, 2024. (Business Times)

Pentamaster: Denies patent infringement claims, seeks to strike out lawsuit. Pentamaster Corp is facing a lawsuit from Ocado Innovation Ltd, a subsidiary of the UK-based Ocado Group, alleging patent infringement concerning warehouse automation and robotics technologies. The lawsuit, filed in the Kuala Lumpur High Court, accuses Pentamaster of developing or using systems that infringe Ocado's intellectual property. Pentamaster has denied the allegations, calling them baseless, and plans to file for the suit to be struck out. It asserts no involvement with the technologies mentioned in the claim. (The Malaysian Reserve)

Peterlabs: Buys land for RM7.4m. Peterlabs Holdings is acquiring 2.7 acres of land in Seremban, Negri Sembilan from N9 Matrix Development Sdn Bhd for RM7.4m. Peterlabs said the acquisition represents a good opportunity to invest and own the property for the long term benefit and interest of the group. "The group has no plans on the usage nor to rent out the property to any third parties at the juncture." In a separate announcement, Peterlabs said it had entered into a research agreement or RA with XMU Jiageng Education Development SB to profile the chemical constituents of naturally derived premixes and to characterise the antioxidant and antimicrobial profiles of naturally derived premixes in vitro. (The Star)

Velocity Capital: Sees emergence of single largest shareholder. Velocity Capital Partner sees the emergence of a new majority shareholder yet again. Datuk Fam Chee Way is now the single largest shareholder of Velocity Capital, formerly known as CSH Alliance, after he bought a 28.79% stake. Fam's vehicle DB Atlantic Capital (M) SB bought out Datuk Liu Han Ming's entire 229.5m shares or 16.61% stake in Velocity Capital and executive director Tan Yip Jiun's 168.17m shares or 12.17% stake via a direct business transaction. (The Edge)

Sunway Reit: Completes Kluang Mall acquisition in Johor. Sunway Real Estate Investment Trust (Sunway Reit) has completed the acquisition of Sunway Kluang Mall on 30 Dec last year. Sunway Kluang Mall is expected to be yield-accretive to Sunway REIT's portfolio with an estimated initial net property income of 7.0%. "We are pleased to end the year with the completion of another acquisition. This fortifies Sunway Reit's portfolio as one of the leading Reits in Malaysia. "We strategically expanded our presence in Johor, which is a high-growth state and magnet for investment," said Sunway REIT Management SB CEO Clement Chen. Sunway Kluang Mall is presently 99% occupied, with over 130 tenants.. (Business Times)

MARKET UPDATE

The KLCI might open lower today after US stock indices slipped on Thursday as Wall Street's weak end to last year carried into 2025. The S&P 500 fell 0.2% to extend the four-day losing streak that dimmed the close of its stellar 2024. The index pinballed through the day between an early gain of 0.9% and a later loss of 0.9% before locking in its longest losing streak since April. The Dow Jones Industrial Average fell 151 points, or 0.4%, after an early gain of 360 points disappeared, and the Nasdaq composite lost 0.2%. Tesla helped drag the market lower after disclosing it delivered fewer vehicles in the last three months of 2024 than analysts expected. The electric-vehicle company's stock slumped 6.1%. Inflation has remained stubbornly above the Fed's 2% target, and Trump's pushing for tariffs and other policies has raised worries about potentially more upward pressure on prices that US consumers have to pay. That drove the Fed to say recently it will likely deliver fewer of the economy-juicing cuts to interest rates in 2025 than it had earlier thought. Expectations for a string of such cuts were a major reason the S&P 500 set dozens of all-time highs last year. Until now, the economy has held up remarkably well despite the high rates brought by the Fed in recent years to stifle inflation. In stock markets elsewhere, indices fell 2.2% in Hong Kong and 2.7% in Shanghai after a survey of factory managers showed Chinese activity expanding at a slower pace in December. New orders, employment and business sentiment weakened. Upbeat talk by Chinese leader Xi Jinping in a New Year's address did little to raise optimism among investors who are hoping for more aggressive action to support the world's second-largest economy and boost stock prices. Stock indices were mostly higher in Europe, while Japan's market remained closed. Back home, the KLCI dropped 9.46 points or 0.58% to 1632.87.

Source: PublicInvest Research - 3 Jan 2025