HEADLINES

Economy

US: Labor market stays on solid footing early in the year. The number of Americans filing new applications for unemployment benefits rose marginally last week, suggesting no deterioration in labor market conditions and reinforcing expectations that the Federal Reserve would not cut interest rates next week. Initial claims for state unemployment benefits increased 6,000 to a seasonally adjusted 223,000 for the week ended 18 Jan Economists polled by Reuters had forecast 220,000 claims for the latest week. Claims were lifted by the wildfire in Los Angeles, with unadjusted applications increasing in California, but falling in the majority of states. (Reuters)

EU: Consumer confidence rises to -14.2 in Jan. Euro zone consumer confidence rose by 0.3 points in Jan from the Dec number, figures released showed. The European Commission said a flash estimate showed euro zone consumer morale improved to -14.2 this month from -14.5 in Dec. Economists polled by Reuters had expected a rise to -14.2. In the European Union as a whole, consumer sentiment remained stable at -13.3 points. (Reuters)

UK: Severe factory downturn eases marginally in Jan, CBI says. A sharp downturn in British factories eased only slightly in Jan and optimism among manufacturers sagged to its lowest level in over two years, an industry survey showed. The Confederation of British Industry's monthly order book gauge improved in Jan to -34 from -40 in Dec, which had been a more than four-year low. The CBI's quarterly gauge of business optimism fell in the first quarter of 2025 to its lowest level since late 2022. "Manufacturers have entered the new year in a grim mood. Confidence has evaporated over the last three months as orders have dropped," said Ben Jones, lead economist at the CBI. (Reuters)

Japan: BOJ likely to raise rates to highest in 17 years, signal more hikes. The Bank of Japan is expected to raise interest rates on Friday to levels unseen since the 2008 global financial crisis, as a broad worldwide stocks rally calms policymakers' fears US President Donald Trump's tariff threats could upend markets. With traders almost fully pricing in the chance of a rate hike, attention now shifts to any clues BOJ Governor Kazuo Ueda's post-meeting briefing could offer on the pace and timing of subsequent increases in borrowing costs. (Reuters)

Japan: Core inflation accelerates, hits 16-month high in Dec. Japan's core consumer prices rose 3.0% in Dec from a year earlier to mark the fastest annual pace in 16 months, data showed, keeping alive market expectations that the central bank will keep raising ultra-low interest rates. The data comes hours before the BOJ concludes its two-day policy meeting, when it is expected to raise short-term interest rates to 0.5% from 0.25%. (Reuters)

Thailand: Exports beat forecast in Dec, seen rising in Jan amid trade uncertainty. Thailand's exports rose for a sixth straight month and more than expected in Dec, with the commerce ministry saying that shipments would increase further in Jan but that uncertainty over US trade policies posed a challenge. Exports grew 8.7% in Dec from a year earlier, beating a forecast for an 8.15% rise in a Reuters poll and up from Nov's 8.2% increase. (Reuters)

Markets

YTL Corp, YTL Power: Plan free warrants; exercise prices at discount to market prices. YTL Corp and YTL Power International have each proposed a bonus issue of free warrants, on the basis of one free warrant for every five shares held in the respective companies. The warrants are planned to be exercised at a discount to the share prices of each company - at 37% discount for YTL Corp, and a 39.5% discount for YTL Power based on their closing prices. If fully exercised, the warrants will bring in RM3.4bn to YTL Corp, and RM2.2bn to YTL Power. YTL Corp owns a 54.94% stake in YTL Power. (The Edge)

MRCB: To jointly undertake RM6.25bn GDV Ipoh Sentral development project. Malaysian Resources Corp is partnering Ipoh Sentral SB (ISSB) to jointly develop the Ipoh Sentral project, with an estimated GDV of RM6.25bn. ISSB, a joint venture between Railway Assets Corporation's (RAC) subsidiary Railway Assets Holding SB (RAHSB) and Silver Smart SB, owned by the Perak State Secretary (Incorporated), operates under a 50:50 shareholding structure. (The Edge)

KIP REIT: Unitholders approve RM98m industrial properties buy from Eddie Ong. KIP Real Estate Investment Trust unitholders have approved the acquisition of four industrial properties associated to its largest shareholder, Datuk Eddie Ong Choo Meng, for a total purchase price of RM98.3m. At the company's EGM, the four acquisition resolutions were passed with shareholders and proxies attending the meeting holding 99%, voting in favour of the related party transaction. The REIT's CEO Valerie Ong Pui Shan shared that all four industrial properties have met the minimum hurdle rate of 6.5%, with rental yields ranging from 6.6% to 7.6%. (The Edge)

Citaglobal: Wins two subcontracts for Kuching Urban Transportation System worth RM36.3m. Citaglobal has secured two subcontracts worth a combined RM36.3m for station works and other works as part of the Kuching Urban Transportation System (KUTS) project in Sarawak. The first subcontract was awarded by Marquris Holdings SB for Package 2 station works under Phase 1 of the infrastructure works, and has a value of RM29.5m. The second subcontract, which was awarded by 38 Marque SB, is for steel structure materials purchase for the same project phase, with a contract value of RM6.7m. (The Edge)

Econframe: To acquire IPSB for RM56m. Econframe is proposing to fully acquire Ivory Pearl SB (IPSB) for a total purchase price of RM56m, to be settled through a combination of cash and consideration shares. The total door system solutions provider said it would be purchasing 7,081,321 ordinary shares in IPSB with a RM46,672,545 cash consideration, with the remaining RM9,327,455 to be settled via the issuance and allotment of 16,500,000 consideration shares of Econframe at an issue price of RM0.5653 per share. (StarBiz)

Westports: Books record revenue and profit for FY2024, declares 10.86 sen dividend. Westports Holdings reported a record-high net profit of RM256.7m for 4QFY2024, a 25% increase from RM206.1m a year ago, driven by higher container revenue. Quarterly revenue grew 22% to RM675.4m, compared to RM554.1m in the previous corresponding period. The group declared a dividend of 10.86 sen per share, payable on Feb 21. (The Edge)

MARKET UPDATE

The KLCI might open higher today after US stocks rose to a record Thursday as Wall Street regained some of the momentum that catapulted it to 57 all-time highs last year. The S&P 500 climbed 0.5% to surpass its record set early last month after coming close the day before. It was the seventh gain in eight days for the main measure of Wall Street's health. The Dow Jones Industrial Average piled on 408 points, or 0.9%, while the Nasdaq composite added 0.2%. The gains came amid relatively calm moves for Treasury yields in the US bond market. Big swings there in recent months have been shaking the stock market, particularly when rising worries about inflation and the US government's heavy debt send Treasury yields higher. In stock markets elsewhere, movements were mostly quiet, even after China's latest attempt to juice stock prices in the world's second-largest economy. Stocks in Hong Kong got a brief boost from China's ordering of pensions and mutual funds to invest more in domestic stocks, for example, but the Hang Seng index ended with a dip of 0.4%. Japan's Nikkei 225 gained 0.8% despite a sharp drop for Fuji Media Holdings after Masahiro Nakai, a top TV host and former pop star, said he was retiring to take responsibility over sexual assault allegations that are part of a wave roiling Japan's entertainment industry. The Fuji TV scandal triggered an avalanche of lost advertising at one of the networks where he worked. Back home, the KLCI ended down by 10.60 points or 0.67% to 1577.20.

Source: PublicInvest Research - 24 Jan 2025