Wednesday, June 30, 2021

Public Mutual declares distributions of RM258m for 16 funds

Public Bank’s wholly owned subsidiary Public Mutual has declared distributions of over RM258 million for 16 funds for the year ended June 30, 2021. — Picture by Farhan Najib
Public Bank’s wholly owned subsidiary Public Mutual has declared distributions of over RM258 million for 16 funds for the year ended June 30, 2021. — Picture by Farhan Najib

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KUALA LUMPUR, June 30 — Public Bank’s wholly owned subsidiary Public Mutual has declared distributions of over RM258 million for 16 funds for the year ended June 30, 2021.

In a statement, the company said a gross distribution of four sen per unit has been declared for PB Balanced Fund, 3.75 sen per unit for PB Islamic Bond Fund and PB Fixed Income Fund respectively, 3.5 sen per unit for PB Infrastructure Bond Fund and three sen per unit for PB Cash Management Fund.

It also announced gross distribution of 2.25 sen per unit for PB Islamic Cash Management Fund and PB China Asean Equity Fund respectively, two sen per unit for PB Global Technology and Healthcare Fund, 1.75 sen per unit for PB Asia Equity Fund and 1.5 sen per unit for PB Islamic Asia Equity Fund, PB Singapore Advantage-30 Equity Fund and PB Growth Fund respectively.

The other funds are Public Islamic Money Market Fund and Public Islamic Asean Growth Fund (three sen per unit respectively), Public Far-East Consumer Themes Fund (1.5 sen per unit) and Public Islamic Savings Fund (0.2 sen per unit).

Public Mutual is Malaysia’s largest private unit trust company with more than 160 funds under its management. As at end-May 2021, the fund size managed by the company was above RM100 billion. — Bernama




Source: Malay Mail

Bursa Malaysia revisits eight-month low amid Covid-19 worries

At 5pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 15.68 points or 1.01 per cent easier at 1,532.63 from yesterday’s close of 1,548.31. — Bernama pic
At 5pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 15.68 points or 1.01 per cent easier at 1,532.63 from yesterday’s close of 1,548.31. — Bernama pic

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KUALA LUMPUR, June 30 — The last trading day of the first half of 2021 saw Bursa Malaysia end sharply lower as investors continued to assess the economic impact from the Covid-19 pandemic in the country.

At 5pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 15.68 points or 1.01 per cent easier at 1,532.63 from yesterday’s close of 1,548.31.

The market bellwether opened 1.01 points lower at 1,547.30 and fluctuated between 1,531.66 and 1,551.95 throughout the session.

On the broader market, losers outpaced gainers 660 to 309, while 426 counters were unchanged, 821 untraded, and 61 others suspended.

Turnover decreased to 4.65 billion units valued at RM2.67 billion from 4.79 billion units valued at RM2.63 billion yesterday.

Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said the FBM KLCI closed at the lowest point in nearly eight months since investor sentiment remained dampened due to the number of daily Covid-19 cases, which remains high at 6,276 cases on June 30.

He said under the FBM KLCI index, the main laggards were Digi and Sime Darby Plantation, both of which dropped by more than 3.0 per cent.

“The slump in these two stocks caused the Bursa Malaysia Telecommunication Index and the Bursa Malaysia Plantation index to both decline by 1.1 per cent during the day, the largest drop amongst the sector indices,” he told Bernama.

He said overseas, other Asian markets recorded gains, taking cue from the robust consumer confidence in the US, which lifted Wall Street performance overnight.

On the home front, among heavyweights, only RHB Bank was in the positive territory, gaining three sen to RM5.40.

IHH lost 16 sen to RM5.47, Digi was 15 sen weaker at RM4.13, while Top Glove and Sime Darby Plantation eased 13 sen each to RM4.17 and RM3.98 respectively.

Public Bank dropped four sen to RM4.11, Hartalega declined 14 sen to RM7.35, Petronas Gas went down 20 sen to RM15.50, Petronas Dagangan dipped 38 sen to RM18.60, and PChem was flat at RM8.06.

Of the actives, Serba Dinamik was up one sen to 33 sen, Sedania surged 22.5 sen to 72.5 sen, Kumpulan Jetson rose 5.5 sen to 34.5 sen, and Saudee added two sen to 20.5 sen.

On the index board, the FBM Emas Index fell 93.44 points to 11,156.22, the FBMT 100 Index decreased 94.15 points to 10,875.09, and the FBM Emas Shariah Index lost 129.65 points to 12,178.28.

The FBM ACE eased 128.09 points to 6,949.35 and the FBM 70 was 58.47 points lower at 14,478.99.

Sector-wise, the Financial Services Index dropped 53.15 points to 15,098.31, the Industrial Products and Services Index was 1.03 points lower at 186.30, and the Plantation Index shed 68.37 points to 6,401.48.

Main Market volume dwindled to 2.96 billion shares valued at RM2.20 billion from 3.15 billion shares valued at RM2.10 billion yesterday.

Warrants turnover narrowed to 144.16 million units valued at RM16.97 million from 183.35 million units valued at RM20.59 million.

Volume on the ACE Market widened to 1.54 billion shares worth RM458.61 million from 1.46 billion shares worth RM507.91 million previously.

Consumer products and services accounted for 505.84 million shares traded on the Main Market, industrial products and services (815.42 million), construction (204.14 million), technology (296.53 million), SPAC (nil), financial services (79.25 million), property (156.92 million), plantation (23.21 million), REITs (2.7 million), closed/fund (15,000), energy (653.44 million), healthcare (51.79 million), telecommunications and media (94.62 million), transportation and logistics (51.05 million), and utilities (25.02 million). — Bernama




Source: Malay Mail

MPOB: India’s lower import duty a boon for Malaysian palm oil industry

Malaysian Palm Oil Board director-general Ahmad Parveez Ghulam Kadir said with the CPO price level stabilising between RM3,500 and RM3,800 per tonne, CPO export to the world’s largest palm oil consumer is bound to increase further in the near future. — Picture by Choo Choy May
Malaysian Palm Oil Board director-general Ahmad Parveez Ghulam Kadir said with the CPO price level stabilising between RM3,500 and RM3,800 per tonne, CPO export to the world’s largest palm oil consumer is bound to increase further in the near future. — Picture by Choo Choy May

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KUALA LUMPUR, June 30 — The Indian government’s decision to reduce its import duty on crude palm oil (CPO) from 15 per cent to 10 per cent is a boon for the Malaysian palm oil industry, giving immediate relief to the smallholders, said the Malaysian Palm Oil Board (MPOB).

Director-general Ahmad Parveez Ghulam Kadir said with the CPO price level stabilising between RM3,500 and RM3,800 per tonne, CPO export to the world’s largest palm oil consumer is bound to increase further in the near future.

Based on the industrial regulator’s data, Malaysia’s palm oil export to India increased by more than eight folds to 1.29 million tonnes from January until May 2021, from 0.15 million tonnes recorded during the same period in 2020.

Yesterday, India’s Ministry of Finance announced that the new tax rate will be effective from June 30 to Sept 30, 2021.

In a statement today, the Indian Vegetable Oil Producers’ Association (IVPA) said the effective import duty on CPO — which includes an agriculture development cess and a surcharge — has now come down to 30.25 per cent from 35.75 per cent.

“With regards to refined palm olein (RPO), Malaysia will not gain much as the import restriction on RPO instituted since Jan 8, 2020 is still in place,” Ahmad Parveez told Bernama, adding that India has also reduced its RPO import duty to 37.5 per cent from 45 per cent previously.

Nevertheless, he cautioned that stiff competition is expected to come from Indonesia, which will also benefit from the import duty reduction.

“Furthermore, Indonesia also announced its plan to reduce CPO export levies to US$175 (RM730) per tonne from the current US$255 per tonne when the CPO price exceeds US$1,000 per tonne,” he said.

Meanwhile, Singapore-based Palm Oil Analytics’ owner and co-founder Sathia Varqa said Malaysia’s market share of CPO imports to India is set to accelerate this year after January-May 2021 exports rose by twelvefold to 1.16 million tonnes versus the corresponding period last year.

He also noted that Indonesia’s CPO export to India fell 32 per cent to 999,304 tonnes.

“Malaysia has been the main CPO exporter to India this year, overtaking Indonesia, and is poised to benefit from the lower import tax,” he added.

According to cargo surveyor Intertek Testing Services’ data, Malaysia’s exports for the June 1-30 period rose by 7.07 per cent to 1.52 million tonnes from 1.42 million tonnes recorded from May 1-30.

Another cargo surveyor, Amspec Malaysia, stated that exports in the June 1-30 period rose 8.62 per cent to 1.55 million tonnes from 1.42 million tonnes in May. — Bernama




Source: Malay Mail

HK tycoon Jimmy Lai’s Next Digital to stop operating from July 1, according to memo

This aerial file photo taken May 18, 2021 shows the offices of the Apple Daily newspaper, part of the Next Digital media group, at the Tseung Kwan O industrial estate in Hong Kong. — AFP pic
This aerial file photo taken May 18, 2021 shows the offices of the Apple Daily newspaper, part of the Next Digital media group, at the Tseung Kwan O industrial estate in Hong Kong. — AFP pic

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HONG KONG, June 30 — Hong Kong media group Next Digital, owned by jailed tycoon Jimmy Lai, will cease operating from July 1 after the company’s assets were frozen as part of a national security investigation, according to an internal memo seen by Reuters.

Next Digital did not immediately respond to a request for comment.

The company is the publisher of Apple Daily, a popular pro-democracy newspaper that closed last week after its newsroom had been raided by 500 police officers investigating whether some articles breached the security law.

Beijing imposed the legislation in Hong Kong on June 30, 2020. It punishes acts deemed by China to be subversive, secessionist, terrorism or collusion with foreign forces with up to life in prison.

Critics say it has been used to crush dissent, while its supporters said it has restored order in Hong Kong after months of pro-democracy protests.

The Next Digital memo, shared separately by two employees, said assets linked to the company remained frozen under the national security investigation.

Dated June 30, the memo was addressed to all Hong Kong staff from the board.

“The group will cease operations,” it said. “Although the road ahead is difficult, continue to move forward!”

The Hong Kong Security Bureau, which directed the asset freeze, did not immediately respond to a request for comment.

Lai, a staunch Beijing critic, was arrested last year on suspicion of colluding with foreign forces. He is currently serving a prison sentence for taking part in illegal assemblies during Hong Kong’s mass 2019 pro-democracy protests.

Next Digital, which had a market capitalisation of HK$765 million (RM408 million), said in a statement to the Hong Kong Stock Exchange yesterday that it had accepted a proposal to divest Amazing Sino, which operates the online edition of Taiwan’s Apple Daily.

It had earlier ceased printing its Taiwan edition on the democratic island, which China views as a breakaway province, blaming declining advertising revenue and difficult business conditions in Hong Kong linked to politics. — Reuters




Source: Malay Mail

Hong Kong shares finish in negative territory

The Hang Seng Index fell 0.57 per cent, or 166.15 points, to 28,827.95. — AFP pic
The Hang Seng Index fell 0.57 per cent, or 166.15 points, to 28,827.95. — AFP pic

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HONG KONG, June 30 —  Hong Kong stocks finished today with losses as traders struggled to maintain early gains and keep track with another Wall Street record, with eyes on the release of key US data this week.

The Hang Seng Index fell 0.57 per cent, or 166.15 points, to 28,827.95.

The benchmark Shanghai Composite Index added 0.50 per cent, or 18.02 points, to 3,591.20, while the Shenzhen Composite Index on China’s second exchange climbed 1.02 per cent, or 24.98 points, to 2,466.24. — AFP




Source: Malay Mail

European stocks slip at open

In the eurozone, Frankfurt’s DAX 30 index reversed 0.2 per cent to 15,661.78 points and the Paris CAC 40 also dropped 0.2 per cent to 6,556.57. ― Reuters pic
In the eurozone, Frankfurt’s DAX 30 index reversed 0.2 per cent to 15,661.78 points and the Paris CAC 40 also dropped 0.2 per cent to 6,556.57. ― Reuters pic

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LONDON, June 30 — Europe’s main stock markets dipped at the open today, with sentiment dented somewhat by a worse-than-expected decline in first-quarter UK economic output.

London’s benchmark FTSE 100 index slid 0.1 per cent to 7,077.72 points, as official data showed that the British economy shrank 1.6 per cent in the first three months of the year.

In the eurozone, Frankfurt’s DAX 30 index reversed 0.2 per cent to 15,661.78 points and the Paris CAC 40 also dropped 0.2 per cent to 6,556.57.

European markets had risen yesterday as optimism over the post-Covid economic recovery eclipsed concerns about rising virus cases. — AFP




Source: Malay Mail

UK economy shrinks more than expected in first quarter

Gross domestic product contracted by 1.6 per cent in the three months to the end of March, down from the previous figure of 1.5 per cent, the Office for National Statistics (ONS) said in a statement. — Reuters pic
Gross domestic product contracted by 1.6 per cent in the three months to the end of March, down from the previous figure of 1.5 per cent, the Office for National Statistics (ONS) said in a statement. — Reuters pic

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LONDON, June 30 — Britain’s coronavirus-hit economy shrank by slightly more than expected in the first quarter before a subsequent easing of lockdown restrictions, revised official data showed today.

Gross domestic product contracted by 1.6 per cent in the three months to the end of March, down from the previous figure of 1.5 per cent, the Office for National Statistics (ONS) said in a statement.

“Today’s updated GDP figures show the same picture as our earlier estimate with schools, hospitality and retail all hit by the re-imposition of the lockdown in January and February, with some recovery in March,” said ONS deputy national statistician Jonathan Athow.

“With many services unavailable, households again saved at record levels.”

The UK government reimposed England’s lockdown in early January, but began lifting restrictions at the start of March with the reopening of schools.

Under a phased reopening, bars and restaurants restarted outdoor dining in April and indoor services in May.

Non-essential retail stores also opened back up in April.

The economy is expected to fully reopen on July 19, after the government delayed the date by four weeks due to surging Delta infections.

The ONS added on Wednesday that economic activity in the first quarter was 8.8 per cent below its pre-pandemic level from late 2019.

“The small downward revision to Q1 GDP growth probably won’t stop the economy from rising back to its pre-pandemic peak in the coming months,” noted Capital Economics analyst Paul Dales.

“And the larger rebound in the household saving rate increases the potential for faster rises in GDP further ahead.” — AFP




Source: Malay Mail

Bursa Malaysia extends losses at mid-afternoon, CI down 11.36 points

On the broader market, losers surpassed gainers 598 to 292, while 403 counters were unchanged, 923 untraded and 61 others suspended. — Picture by Razak Ghazali
On the broader market, losers surpassed gainers 598 to 292, while 403 counters were unchanged, 923 untraded and 61 others suspended. — Picture by Razak Ghazali

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KUALA LUMPUR, June 30 — Bursa Malaysia ended the morning trading session lower as investors were on a risk-off mode due to the prevalent negative vibe from the Covid-19 development in the country.

The downtrend can be seen across sectors, except for technology, which recorded marginal gains.

At 3.08pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 11.36 points easier at 1,536.95 compared with Tuesday’s close of 1,548.31.

The market bellwether opened 1.01 points lower at 1,547.30.

On the broader market, losers surpassed gainers 598 to 292, while 403 counters were unchanged, 923 untraded and 61 others suspended.

Turnover stood at 2.84 billion units worth RM1.42 billion.

Among heavyweights, only RHB Bank and PetChem were in positive territory, gaining two sen to RM5.39 and one sen to RM8.07, respectively.

Digi lost 12 sen to RM4.16 while Top Glove and IOI eased 10 sen each to RM4.20 and RM3.71 respectively.

Of the actives, Sedania surged 21 sen to 71 sen, Serba Dinamik was flat at 32 sen, and Saudee gained 1.5 sen to 20 sen.

On the index board, the FBM Emas Index fell 65.79 points to 11,183.87, the FBMT 100 Index decreased 69.48 points to 10,899.76, and the FBM Emas Shariah Index lost 78.89 points to 12,229.04.

The FBM ACE eased 54.25 points to 7,023.19 and the FBM 70 was 48.95 points lower at 14,488.19.

Sector-wise, the Financial Services Index dropped 57.76 points to 15,093.70, the Industrial Products and Services Index was 1.0 point lower at 186.33, and the Plantation Index shed 46.73 points to 6,423.12. — Bernama




Source: Malay Mail

Bursa Malaysia lower at mid-day

At 12.30pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 5.64 points easier at 1,542.67 from yesterday’s close of 1,548.31. — Picture by Firdaus Latif
At 12.30pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 5.64 points easier at 1,542.67 from yesterday’s close of 1,548.31. — Picture by Firdaus Latif

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KUALA LUMPUR, June 30 ― Bursa Malaysia ended the morning trading session lower as investors were on a risk-off mode due to the prevalent negative vibe from the Covid-19 development in the country.

The downtrend can be seen across sectors, except for the technology, telecommunications and media, consumer products and services sectors which recorded marginal gains.

At 12.30pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 5.64 points easier at 1,542.67 from yesterday’s close of 1,548.31.

The market bellwether opened 1.01 points lower at 1,547.30 and fluctuated between 1,540.97 and 1,551.95 throughout the session.

On the broader market, losers surpassed gainers 523 to 316, while 390 counters were unchanged, 987 untraded and 61 others suspended.

Turnover stood at 2.39 billion units worth RM1.14 billion.

An analyst said the market was dragged down by losses in Top Glove and Hartalega, as investors booked profits following yesterday's gains.

Overall, trading continued to be muted following the lack of market-moving news domestically.

“Investors are also keeping their eye out for the outcome of the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) meeting tomorrow,” she said.

Conversely, regional markets were mostly higher, with investors taking their cue from the positive overnight Wall Street performance as the Nasdaq and the S&P 500 hit fresh closing highs.    

Singapore's Straits Times Index rose 1.33 per cent to 3,130.69, Japan's Nikkei was 0.01 per cent better at 28,814.44 and China's SSE Composite Index increased 0.24 per cent to 3,581.72.

Back home, heavyweights Top Glove and Hartalega dropped nine sen and six sen to RM4.21 and RM7.43, respectively, while both Digi and IOI declined eight sen to RM4.20 and RM3.73, respectively.

Meanwhile, PetChem gained five sen to RM8.11 and CIMB was two sen higher at RM4.63.

Of the actives, Sedania surged 23.5 sen to 73.5 sen, Serba Dinamik was flat at 32 sen, while both OCR and Saudee gained 1.5 sen to 22 sen and 20 sen, respectively.

On the index board, the FBM Emas Index fell 30.63 points to 11,219.03, the FBMT 100 Index decreased 31.62 points to 10,937.62, and the FBM Emas Shariah Index reduced 36.10 points to 12,271.83.

The FBM ACE eased 15.07 points to 7,062.37 and the FBM 70 was 9.33 points lower at 14,528.13.

Sector-wise, the Financial Services Index dropped 33.02 points to 15,118.44, the Industrial Products and Services Index was 0.21 of-a-point lower at 187.12, and the Plantation Index shed 24.95 points to 6,444.90. ― Bernama




Source: Malay Mail

Asian shares rise after consumer confidence boosts Nasdaq to record high

Chinese blue-chips added 0.1 per cent, Australian shares were up 0.58 per cent and set for a ninth straight month of gains, and Seoul’s Kospi rose 0.35 per cent. Japan’s Nikkei edged up 0.06 per cent. — Reuters pic
Chinese blue-chips added 0.1 per cent, Australian shares were up 0.58 per cent and set for a ninth straight month of gains, and Seoul’s Kospi rose 0.35 per cent. Japan’s Nikkei edged up 0.06 per cent. — Reuters pic

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SHANGHAI, June 30 — Asian shares rose and a gauge of global equities hovered near record highs today after rising consumer confidence in economic recovery boosted the Nasdaq index to its highest-ever closing level.

MSCI’s global share index was set for a fifth straight month of gains today. Its index tracking Asian shares outside Japan was set for a small monthly loss, but still on course for a fifth straight quarterly rise, its longest such streak since 2006-2007.

The Asian index was last up 0.33 per cent on the day.

Chinese blue-chips added 0.1 per cent, Australian shares were up 0.58 per cent and set for a ninth straight month of gains, and Seoul’s Kospi rose 0.35 per cent. Japan’s Nikkei edged up 0.06 per cent.

Still, Steven Daghlian, market analyst at CommSec in Sydney, said that following the global run-up in equities, markets were “on edge” ahead of the release of US non-farm payrolls data on Friday, the results of which could influence Federal Reserve policy.

Economists polled by Reuters are expecting a gain of 690,000 jobs for June, up from 559,000 in May.

“(It looks like) five straight months of gains in the U.S ... still around record highs as well, and the end of the month and quarter as well. So that can also create just a little bit more volatility,” said Daghlian.

On Monday, Richmond Federal Reserve President Thomas Barkin said the US central bank has made “substantial further progress” toward its inflation goal in order to begin tapering asset purchases.

The market’s continued focus on Fed plans for tapering come as the world’s largest economy continues to rebound from pandemic lockdowns.

US consumer confidence jumped to its highest level in nearly one and a half years in June as growing labour market optimism amid a reopening economy offset concerns about higher inflation. That came even as the Federal Housing Finance Agency house price index shot up a record 15.7 per cent in April from a year ago, corroborating soaring house price inflation.

Overnight on Wall Street, the Dow Jones Industrial Average and S&P 500 gained or 0.03 per cent, and the Nasdaq Composite added 0.19 per cent, hitting its record high close.

At the same time, some investors remain worried about the economic impact of the highly infectious Delta variant of the virus that causes Covid-19.

Indonesia, Malaysia, Thailand and Australia are all battling outbreaks and tightening restrictions, and Spain and Portugal announced restrictions for unvaccinated British tourists.

Underlining the impact of even small flare-ups of new Covid-19 cases, new data showed activity in China’s services sector grew at a slower pace in June as curbs from a resurgence in cases in southern China restrained a rebound in consumption.

The currency market was more focused on the potential impact of new virus outbreaks, with the dollar edging down from one-week peaks. The dollar index was last down 0.04 per cent at 92.026, with the yen firming slightly to 110.48 and the euro up 0.08 per cent at US$1.1904 (RM4.94).

“Month-end rebalancing flows may also be at play, but with US equities outperforming in June and in the quarter, the bias would be for USD selling rather than buying,” Rodrigo Catril, senior FX strategist at National Australia Bank, said in a note.

Sterling was last trading at US$1.3857, up 0.17 per cent on the day.

Meanwhile US Treasury yields were slightly lower. The benchmark 10-year note last yielded 1.4765 per cent, down slightly from 1.48 per cent late yesterday.

The 30-year bond last yielded 2.0891 per cent, down from 2.097 per cent.

Oil prices remained higher as hopes for a demand recovery persisted despite the new Delta variant outbreaks.

Brent crude futures settled 0.56 per cent at US$75.18 per barrel and US crude gained 0.79 per cent to US$73.56.

Spot gold rose 0.15 per cent to US$1,763.66 an ounce. — Reuters




Source: Malay Mail

Sapura Energy shares flat after announcing Q1 net loss

At 11am, the counter was unchanged at 13 sen with 60.60 million shares transacted. — Bernama pic
At 11am, the counter was unchanged at 13 sen with 60.60 million shares transacted. — Bernama pic

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KUALA LUMPUR, June 30 — Sapura Energy Bhd shares were almost flat in early trade Wednesday, after posting a net loss of RM97.07 million in the first quarter (Q1) ended April 30, 2021 compared with a net profit of RM14.21 million in the same quarter a year ago.

At 11am, the counter was unchanged at 13 sen with 60.60 million shares transacted.

The integrated oil and gas services company said the negative performance was mainly to the unfavourable effect of the US dollar against the ringgit and lower share of profit from associates and joint-venttures.

Revenue however rose 8.4 per cent to RM1.47 billion during the quarter under review from RM1.36 billion previously, mainly attributable to the higher revenue from engineering and construction as well as drilling business segments.

AmBank Research in a note today said given the continuing impact of the pandemic, it has lowered financial year 2022 — 2024 (FY2022 — FY2024) earnings forecasts by 12-16 per cent due to higher operating costs together with increased production cost assumptions for the group’s 50 per cent-owned exploration and production (E&P) arm, Sapura OMV.

Meanwhile, MIDF Research opined that Sapura Energy’s future endeavours will improve on the basis of a positive global crude oil price outlook in FY2021, which will benefit its engineering and construction (E&C) and E&P business segments.

This also on the basis that Sapura Energy is well-equipped with ongoing projects and potentially new prospects and leads from ongoing bids, including for operations and maintenance and its new venture into renewables.

Both AmBank Research and MIDF Research are maintaining a “Buy” call on Sapura Energy. — Bernama




Source: Malay Mail

Bursa Malaysia remains lower at midmorning

On the broader market, losers surpassed gainers 447 to 268, while 415 counters were unchanged, 1,086 untraded and 61 others suspended. — Bernama pic
On the broader market, losers surpassed gainers 447 to 268, while 415 counters were unchanged, 1,086 untraded and 61 others suspended. — Bernama pic

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KUALA LUMPUR, June 30 — Bursa Malaysia has remained on a downtrend at midmorning due to the prevalent risk-off mode as investors were cautious over the Covid-19 development in the country.

The downtrend can be seen across sectors except for the technology, telecommunications and media sector, which recorded marginal gains.

At 11am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 5.52 points easier at 1,542.79 from Tuesday’s close of 1,548.31.

The market bellwether opened 1.01 points lower at 1,547.30.

On the broader market, losers surpassed gainers 447 to 268, while 415 counters were unchanged, 1,086 untraded and 61 others suspended.

Turnover stood at 1.64 billion units worth RM717.51 million.

Heavyweights Top Glove and Hartalega dropped nine sen and 13 sen to RM4.21 and RM7.36, respectively, while both Digi and IOI declined eight sen to RM4.20 and RM3.73, respectively.

Of the actives, Serba Dinamik was flat at 32 sen, while OCR and Saudee gained 1.5 sen each to 22 sen and 20 sen, respectively.

On the index board, the FBM Emas Index fell 31.12 points to 11,218.54, the FBMT 100 Index decreased 31.05 points to 10,938.19, and the FBM Emas Shariah Index reduced 47.15 points to 12,260.78.

The FBM ACE eased 3.89 points to 7,073.33 and the FBM 70 was 9.54 points lower at 14,527.92.

Sector-wise, the Financial Services Index dropped 10.65 points to 15,140.81, the Industrial Products and Services Index was 0.6 of-a-point lower at 186.73, and the Plantation Index shed 29.80 points to 6,440.05. — Bernama




Source: Malay Mail

China manufacturing slows as supply shortages roil Asia industry

China’s June official manufacturing PMI eased slightly to 50.9 versus 51.0 in May, data from the National Bureau of Statistics showed today. It, however, exceeded analysts’ forecast for a slowdown to 50.8. — Reuters pic
China’s June official manufacturing PMI eased slightly to 50.9 versus 51.0 in May, data from the National Bureau of Statistics showed today. It, however, exceeded analysts’ forecast for a slowdown to 50.8. — Reuters pic

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BEIJING, June 30 — Growth in China’s June factory activity dipped to a four-month low on higher raw material costs, a shortage of semiconductors and a Covid-19 outbreak in the major export province of Guangdong, amid wider supply chain disruptions in Asia.

The chip supply crunch has hammered other manufacturing powerhouses in Asia. Industrial output in Japan and South Korea slumped in May from the previous month as auto production declined due to semiconductor shortages, adding to concerns of flagging momentum in their respective economies.

China’s June official manufacturing Purchasing Manager’s Index (PMI) eased slightly to 50.9 versus 51.0 in May, data from the National Bureau of Statistics showed today. It, however, exceeded analysts’ forecast for a slowdown to 50.8.

It remained above the 50-point mark that separates growth from contraction on a monthly basis.

“This was largely a result of Covid, which has affected factory output and also new export orders due to the rising waves of infections and resultant restrictions in some neighbouring economies,” said Iris Pang, Great China chief economist at ING.

“Overall, (it’s) not a great month but no really worrying signs...China’s growth rate is still positive, though it would be a lot lower in H2 than H1, mostly because of the change in base effects,” said Pang, referring to year-ago comparisons with 2020’s pandemic disruptions.

The sub-index for production eased to 51.9, a four-month low, from 52.7 the previous month. Zhao Qinghe, a senior statistician at the NBS, attributed the slowdown in production to constraining factors such as a shortage of semiconductors, inadequate coal supply, a power crunch and maintenance of equipment.

A shortage of coal supply in China’s southern regions, which started in mid-May, hit factory operations though the government has said the power crunch should ease soon.

New export orders fell for a second consecutive month in June and at a faster pace, likely due to the global resurgence of Covid-19 variants, forcing some countries to reimpose lockdowns.

A sub-index for raw material costs in the official PMI stood at 61.2 in June, compared with May’s 72.8, as the government cracked down on high raw material prices.

Growth in new orders, however, picked up, as domestic demand improved.

The world’s second-largest economy has largely recovered from disruptions caused by the pandemic, but Gross Domestic Product (GDP) growth is set to moderate.

“Much of the recovery has occurred and the momentum is slowing. Combined with a relatively higher base, this means year-on-year GDP growth is expected to slow to 7.2 per cent in Q2 from 18.3 per cent in Q1,” said analysts at HSBC.

However, in two-year average terms, they expect growth to pick up to 5.2 per cent from 5.0 per cent, though this is still below pre-pandemic levels of 6.0 per cent growth.

An outbreak of coronavirus infections in China’s major export province of Guangdong has also disrupted shipments.

The official non-manufacturing Purchasing Managers’ Index (PMI) fell to 53.5 in June from 55.2 in May, a separate survey from the NBS showed, dampened by a sharp pull-back in the recovery of the services sector due to local Covid outbreaks.

The construction index held steady at 60.1, although analysts expect the sector to face headwinds amid Beijing’s clampdown on the property market. — Reuters




Source: Malay Mail

Bursa Malaysia lower in early trade

On the broader market, losers surpassed gainers 184 to 167, while 244 counters were unchanged, 1,621 untraded and 61 others suspended. — Bernama pic
On the broader market, losers surpassed gainers 184 to 167, while 244 counters were unchanged, 1,621 untraded and 61 others suspended. — Bernama pic

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KUALA LUMPUR, June 30 — Bursa Malaysia was lower in early trade on Wednesday due to a prevalent risk-off mode as investors were cautious over the Covid-19 development in the country.

The downtrend can be seen across sectors except for the financial, construction and industrial products and services segments which recorded marginal gains.

At 9.09am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 0.86 of-a-point easier at 1,547.45 from Tuesday’s close of 1,548.31.

The market bellwether opened 1.01 points lower at 1,547.30.

On the broader market, losers surpassed gainers 184 to 167, while 244 counters were unchanged, 1,621 untraded and 61 others suspended.

Turnover stood at 307.35 million units worth RM112.54 million.

In a note today, Malacca Securities said the local bourse might not be able to sustain its upward momentum seen yesterday as the daily Covid-19 tally still ranged between 5,000 and 7,000 cases.

The number of new Covid-19 cases had breached the 6,000-mark on Tuesday.

“For now, we believe the uptrend in the technology counters on the local front remains intact following the overnight gains in Nasdaq.

“Additionally, the transportation and logistics sector should continue to do well following the recent sell-down, and, with the Covid-19 Delta variant being a concern, trading interest might build up on glove stocks,” it said.

Heavyweights IHH, Digi and Sime Darby Plantation dropped three sen each to RM5.60, RM4.25 and RM4.08, respectively, while Hong Leong Bank was eight sen weaker at RM18.76 and Petronas Dagangan lost 14 sen to RM18.84.

Conversely, HLFG surged 42 sen to RM18.22, while Public Bank, Maybank and TNB rose two sen to RM4.17, RM8.15 and RM9.86, respectively.

Of the actives, OCR Group increased three sen to 23.5 sen, Serba Dinamik declined half-a-sen to 31.5 sen and Tanco was flat at 15 sen.

On the index board, the FBM Emas Index gave up 2.77 points to 11,246.89, the FBMT 100 Index increased 2.72 points to 10,966.52, and the FBM Emas Shariah Index rose 8.95 points to 12,298.98.

The FBM ACE reduced 4.34 points to 7,073.10 and the FBM 70 added 9.48 points to 14,546.94.

Sector-wise, the Financial Services Index recovered 19.55 points to 15,171.01, the Industrial Products and Services Index was 0.02 of-a-point higher at 187.35, and the Plantation Index decreased 12.97 points to 6,456.88. — Bernama




Source: Malay Mail

Ringgit opens slightly lower against US dollar

At 9.03am, the local note declined to 4.1540/1590 versus the US dollar from 4.1510/1530 at Tuesday’s close. — Reuters pic
At 9.03am, the local note declined to 4.1540/1590 versus the US dollar from 4.1510/1530 at Tuesday’s close. — Reuters pic

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KUALA LUMPUR, June 30 — The ringgit opened slightly lower against the US dollar today as the demand for goods and services in the United States (US) boosted the greenback, a dealer said.

At 9.03am, the local note declined to 4.1540/1590 versus the US dollar from 4.1510/1530 at yesterday's close.

ActivTrades trader, Dyogenes Rodrigues Diniz said the dollar had strengthened after the recently released Consumer Confidence Index survey by the US Conference Board reported higher-than-expected numbers.

“As this is a leading indicator that measures the level of confidence based on families’ spending and the demand for goods and services, the market reacted quickly, thus pushing the greenback higher,” he said.

The survey also suggested a strong momentum in the economy at the end of the second quarter as it reported consumers’ healthy appetite for long-lasting manufactured goods.

At the opening, the ringgit was also traded marginally lower against a basket of major currencies.

Against the British pound, it fell to 5.7541/7610 from 5.7516/7544 at yesterday's close and eased vis-a-vis the euro to 4.9437/9496 from 4.9434/9458 previously.

The local unit also weakened against the Singapore dollar to 3.0887/0927 from 3.0883/0900 yesterday and declined against the Japanese yen to 3.7583/7628 from 3.7538/7560 previously. — Bernama




Source: Malay Mail

Tencent-backed Linklogis, Sunway to jointly seek Malaysia digital bank licence, say sources

Bank Negara has said it would issue up to five licences by early 2022 and the deadline for the applications is the end of this month. — Picture by Ahmad Zamzahuri
Bank Negara has said it would issue up to five licences by early 2022 and the deadline for the applications is the end of this month. — Picture by Ahmad Zamzahuri

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SINGAPORE, June 30 — Malaysian conglomerate Sunway Bhd has teamed up with Tencent-backed Chinese fintech firm Linklogis Inc and Bangkok Bank PCL to apply for a Malaysian digital bank licence, two sources with knowledge of the matter said.

Sunway will hold a majority stake in the venture, said the sources, who requested anonymity as names of the consortium members haven’t been reported.

The group joins a crowded field of hopefuls vying for up to just five licences on offer in the Southeast Asian country.

Malaysia is the latest to embrace online-only banking services after Singapore, Philippines, Hong Kong and other Asian countries, with the entry of technology firms seen shaking up their often staid markets.

Malaysia’s banking sector is dominated by Maybank , CIMB Group Holdings and Public Bank Bhd.

The country’s central bank has said it would issue up to five licences by early 2022 and the deadline for the applications is the end of this month.

When asked for a comment, Sunway, which has property, healthcare and education businesses, referred to a statement issued earlier this month in which it said it would apply for an online-only banking licence with partners to expand in the fintech sector, but it did not name them.

Sunway owns and manages an online remittance firm and has a subsidiary that provides loans to business partners. It is also the majority shareholder of Credit Bureau Malaysia.

Hong Kong-based Linklogis, which specialises in supply chain finance, declined to comment and said it would share details with the market “at the appropriate time.” Chinese tech behemoth Tencent is its biggest shareholder with a nearly 15 per cent stake.

Tencent declined to comment.

Linklogis was part of a consortium that was granted a Singapore digital wholesale bank licence. The bank is due to be launched in 2022.

There was no immediate response to a Reuters query sent to Bangkok Bank yesterday. — Reuters




Source: Malay Mail

S&P, Nasdaq rise to record closes

All three major Wall Street indexes are set for their fifth straight quarter of gains, boosted by ultra-loose monetary policy, a rebounding US economy and robust corporate earnings. — AFP pic
All three major Wall Street indexes are set for their fifth straight quarter of gains, boosted by ultra-loose monetary policy, a rebounding US economy and robust corporate earnings. — AFP pic

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NEW YORK, June 30 — The S&P 500 and the Nasdaq both registered record closing highs yesterday, lifted by Apple Inc and other technology stocks after an upbeat consumer confidence report.

The S&P 500, helped by a jump in Morgan Stanley shares on news of a dividend increase, hit a record high for the fourth straight session. The S&P and the Dow closed little changed after a session marked by lighter than average volume, as the market awaits more economic data.

“I think the market is in a digestion period,” said Tom Martin, senior portfolio manager at Globalt. “We’re waiting for that next piece of information that’s going to give us an idea of how sustainable the recovery is.”

Market participants are closely watching the nonfarm payroll report due on Friday, which could sway the US Federal Reserve’s policy stance which hinges on an equitable recovery of the labour market.

An upbeat consumer confidence report yesterday set a positive tone for jobs data. US consumer confidence increased in June to its highest level since the Covid-19 pandemic started more than a year ago, bolstering expectations for strong economic growth in the second quarter.

“If there’s a strong nonfarm payrolls number this month and we start making progress on the unemployment rate, that changes the whole Fed narrative,” said Mike Zigmont, head of trading and research at Harvest Volatility Management in New York.

Three of the 11 major S&P sector indexes rose, with technology and consumer discretionary stocks the top gainers, up 0.7 per cent and 0.23 per cent, respectively.

Morgan Stanley jumped 3.4 per cent after it doubled its dividend to 70 cents per share in the third quarter. JPMorgan Chase & Co, Bank of America Corp and Goldman Sachs Group also raised their payouts.

All three major Wall Street indexes are set for their fifth straight quarter of gains, boosted by ultra-loose monetary policy, a rebounding US economy and robust corporate earnings.

With the S&P 500 climbing nearly 14 per cent in the first half of the year, investor focus is expected to shift to the second-quarter earnings season, beginning in July, which could decide the path for the next leg of the equity markets.

The Dow Jones Industrial Average rose 9.02 points, or 0.03 per cent, to 34,292.29. The S&P 500 gained 1.19 points, or 0.03 per cent, to 4,291.8 and the Nasdaq Composite added 27.83 points, or 0.19 per cent, to 14,528.34.

Moderna Inc jumped 5.2 per cent to a record high after the drugmaker’s Covid-19 vaccine showed promise in a lab study against the Delta variant first identified in India, with a modest decrease in response compared with the original strain.

The largest percentage gainer on the S&P 500 was Skyworks Solutions, which rose 4.5 per cent, as Barclays analysts raised their price target, citing it as one of the suppliers to Apple that could benefit from the new iPhone launch. Apple rose more than 1.1 per cent.

Volume on US exchanges was 9.60 billion shares, compared with the 11.1 billion average for the full session over the last 20 trading days.

Declining issues outnumbered advancing ones on the NYSE by a 1.18-to-1 ratio; on Nasdaq, a 1.51-to-1 ratio favoured decliners.

The S&P 500 posted 38 new 52-week highs and no new lows; the Nasdaq Composite recorded 93 new highs and 38 new lows. — Reuters




Source: Malay Mail

Global shares edge lower on new Covid-19 outbreaks in Asia

The Nasdaq closed at a record high, boosted by technology stocks and a government survey showing US consumer confidence in June hit its highest level since the pandemic started. — Reuters pic
The Nasdaq closed at a record high, boosted by technology stocks and a government survey showing US consumer confidence in June hit its highest level since the pandemic started. — Reuters pic

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NEW YORK, June 30 — Global shares edged lower yesterday, as new coronavirus outbreaks in Asia vied with strong US and European consumer confidence, and investors speculated about whether the Federal Reserve would accelerate its timetable to end easy monetary policy.

The US dollar rose to a one-week peak on safe-haven buying stoked by fears that the highly contagious Delta variant could derail a burgeoning economic recovery.

MSCI’s all country world index, which tracks shares across 50 countries, shed 0.06 per cent, as declines in Asian equities undercut new highs in U.S and European markets.

The Nasdaq closed at a record high, boosted by technology stocks and a government survey showing US consumer confidence in June hit its highest level since the pandemic started.

European shares ended higher after data there showed economic sentiment hit a 21-year high in June. The pan-European STOXX 600 index closed 0.3 per cent higher at 456.37 points.

Still, MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.55 per cent lower, Japan’s Nikkei lost 0.81 per cent, and Chinese stocks lost 0.92 per cent.

Investors are worried about the economic impact of the highly infectious Delta variant. Indonesia, Malaysia, Thailand and Australia are all battling outbreaks and tightening restrictions, and Spain and Portugal announced restrictions for unvaccinated British tourists.

“These are headwinds to risk assets performing well, but if we step back, we are still looking at equity indices that continue to hit all time highs,” said Patrick Leary, chief market strategist and senior trader at Incapital.

Investors are also waiting for the US jobs due out on Friday, the results of which could influence Fed policy.

Economists polled by Reuters are expecting a gain of 690,000 jobs for June, up from 559,000 in May.

On Monday, Richmond Federal Reserve President Thomas Barkin said the US central bank has made “substantial further progress” toward its inflation goal in order to begin tapering asset purchases.

“A good number will speed up the debate about tapering asset purchases soon and raising rates sooner,” Leary said.

Unofficially, the Dow Jones Industrial Average rose 20.24 points, or 0.06 per cent, to 34,303.51, the S&P 500 gained 2.05 points, or 0.05 per cent, to 4,292.66 and the Nasdaq Composite added 28.67 points, or 0.2 per cent, to 14,529.17.

The Nasdaq was boosted by Apple Inc, while the S&P was helped by Morgan Stanley’s news late Monday that it would double its dividend.

Germany’s DAX added 0.9 per cent, after Adidas lifted the German index with news of a share buy back plan.

The US dollar rose to a one-week peak. The dollar index , which tracks the greenback versus a basket of six currencies, rose 0.2 per cent to 92.077, with the euro down 0.19 per cent to US$1.19 (RM4.94).

Sterling was last US$1.3849, down 0.24 per cent. The Australian dollar fell 0.71 per cent versus the greenback at US$0.751.

Oil prices rose as hopes for a demand recovery persisted despite new outbreaks of the Delta variant.

Brent crude futures settled up 8 cents, or 0.11 per cent, and US crude settled up 7 cents, or up 0.10 per cent.

Spot gold dropped 1.0 per cent to US$1,760.77 an ounce. US gold futures fell 1.06 per cent to US$1,761.00 an ounce.

Yields for benchmark 10-year US Treasuries were last up less than a basis point at 1.4816 per cent.

Germany’s 10-year bond yield was up 1 basis point at -0.173 per cent. — Reuters




Source: Malay Mail

China’s Didi raises US$4b in US IPO, say sources

A Didi logo is seen at the headquarters of Didi Chuxing in Beijing, China November 20, 2020. — REUTERS
A Didi logo is seen at the headquarters of Didi Chuxing in Beijing, China November 20, 2020. — REUTERS

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BEIJING, June 30 — Chinese ride hailing company Didi Global Inc raised US$4 billion (RM16.5 billion) in its US initial public offering (IPO) yesterday, pricing it at the top of its indicated range, according to people familiar with the matter.

Didi will sell 288 million American Depository Shares (ADS) at US$14 apiece, the source said. This gives Didi a valuation of about US$73 billion on a fully diluted basis.

The sources asked not to be identified ahead of an official announcement. Didi did not immediately respond to a request for comment.

The listing in New York, which will be the biggest US share sale by a Chinese company since Alibaba raised US$25 billion in 2014, comes on the heels of record IPO activity this year, as companies rush to capture the lucrative valuations seen in the US stock market.

A total of 29 IPOs by Chinese companies in the United States in the first six months of the year raised US$7.6 billion, the highest amount ever for that time period, according to Refinitiv data.

Didi’s IPO was covered early on the first day of the book-build last week and the investor books were closed on Monday, one day ahead of schedule.

The book is covered multiple times by investors, two sources told Reuters yesterday.

An over-allotment option, or greenshoe, exists where a further 43.2 million shares can be sold to increase the size of the deal.

Didi was co-founded in 2012 by former Alibaba employee Will Wei Cheng, who currently serves as the chief executive officer. Cheng was joined by Jean Qing Liu, a former Goldman banker and the current president of the ride-sharing company.

The company counts SoftBank, Uber Technologies Inc and Tencent as its main backers.

Didi is also known for successfully pushing Uber out of the Chinese market after the US company lost a price war and ended up selling its China operations to Didi for a stake. Liu Zhen, the head of Uber China at the time, is Didi’s Liu’s cousin.

Like most ride-hailing companies, Didi had historically been unprofitable, until it reported a profit of US$30 million in the first quarter of this year. The company reported a loss of US$1.6 billion last year, and its revenue declined 8 per cent to US$21.63 billion in the same period, according to a regulatory filing, as business slid during the pandemic.

Didi shares are due to start trading today on the New York Stock Exchange under the symbol “DIDI.” Goldman Sachs, Morgan Stanley, and J.P. Morgan are the lead underwriters for the IPO. — Reuters




Source: Malay Mail

IMF approves US$2.5b loan, debt relief deal for Sudan

The announcement came after the International Monetary Fund finalised an agreement with 101 donor countries allowing Sudan to clear roughly US$1.4 billion in arrears to the Washington-based lender — the key hurdle to allow access to fresh aid. — Reuters pic
The announcement came after the International Monetary Fund finalised an agreement with 101 donor countries allowing Sudan to clear roughly US$1.4 billion in arrears to the Washington-based lender — the key hurdle to allow access to fresh aid. — Reuters pic

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WASHINGTON, June 30 — The IMF yesterday approved a US$2.5 billion (RM10.3 billion) loan for Sudan, and with the World Bank sealed a landmark deal that unlocks nearly US$50 billion in debt relief for the impoverished African nation.

The announcement came after the International Monetary Fund finalised an agreement with 101 donor countries allowing Sudan to clear roughly US$1.4 billion in arrears to the Washington-based lender — the key hurdle to allow access to fresh aid.

“We congratulate the Sudanese government and people for their commendable hard work and progress toward this remarkable milestone,” IMF chief Kristalina Georgieva and World Bank President David Malpass said in a joint statement.

Payment of the arrears is the “decision point” that allows access to debt relief under the Heavily-Indebted Poor Countries (HIPC) initiative which the officials said will cover US$50 billion or about 90 per cent of the country’s foreign debt.

Sudan will receive US$1.4 billion immediately under the 39-month IMF loan programme.

‘Historic’ agreement

Washington welcomed the announcement that Sudan is now eligible to receive debt relief from the international lending institutions.

“This is a historic moment for Sudan and its people,” US Treasury Secretary Janet Yellen said in a statement.

“These steps will unlock much-needed financing and will help build the foundation for poverty reduction, inclusive development, and economic growth.”

Yellen also praised the efforts of Sudan’s civilian government to stabilise the economy.

The new aid comes amid a rapprochement between the United States and Sudan following the ouster of strongman Omar al-Bashir, who was toppled amid street protests in April 2019 after three decades of iron-fisted rule marked by economic hardship, deep internal conflicts, and biting international sanctions that curtailed investment.

In the past two years, Prime Minister Abdalla Hamdok, a seasoned UN economist-turned-premier, has pushed to rebuild the crippled economy and end Sudan’s international isolation.

Washington in December removed Sudan from its blacklist of state sponsors of terrorism, removing a major hurdle to foreign investment.

President Joe Biden has continued the thaw in relations since taking office in January, and his administration has taken a leading role in encouraging other governments to join in the effort to provide debt relief.

The US Treasury in March announced US$1.15 billion in bridge financing to help clear Sudan’s arrears at the World Bank, after Khartoum’s civilian-backed government announced a series of reforms.

Treasury said the United States also committed to contribute up to US$120 million in grant resources to fund IMF debt relief for Sudan under the first phase of HIPC.

Continued reforms

Sudan is the last country to clear arrears with the IMF, which now faces no repayment arrears from its members for the first time since early 1974.

Georgieva praised the government’s “strong policy commitment” that has shored up public finances “while channeling assistance to the most vulnerable.”

But she said “continued reform commitment will be critical to achieve the programme’s objectives, as well as to reduce poverty and secure higher and more inclusive growth.”

The government moved to a market-based exchange rate and removed fuel subsidies in its efforts to secure the deal with the crisis lenders.

In an interview with AFP last month, Hamdok said the widely unpopular moves were needed to secure debt relief and the government was calling on foreign investors to “explore the opportunities for investing in Sudan.” — AFP




Source: Malay Mail

Canada’s Manulife hopes to tap into Asia's growth in wealth

TORONTO: Manulife Financial Corp has raised the proportion of core profit it aims to earn from its fastest-growing businesses, including asset management and its operations in Asia, where it hopes to capitalise on the continent's rapid growth in wealth.

Canada’s biggest life insurer aims to derive 75% of core earnings from its “high-potential businesses” by 2025, chief executive officer Roy Gori (pix) said in an interview ahead of the company’s investor day on Tuesday.

That compares with its original goal that these units, which also include behavioural-linked insurance and group benefits, should account for two-thirds of earnings by 2022. In Manulife's latest quarterly results, they made up 60% of core earnings.

Much of the targeted growth will come from Asia, which is expected to account for half of core earnings by 2025, Gori said, from about 41% as of the end of 2020.

“The low penetration rates on the insurance side, and the growing middle class obviously mean that we’re going to see many more people interested in embracing insurance as a key way through which they think about their financial protection,“ Gori said.

If insurance penetration rates – the ratio of total insurance premiums to gross domestic product – rise to 3%, particularly in the Philippines, Indonesia, Vietnam and China, that could result in US$1 billion (RM4.15 billion) of additional annual premium-equivalent sales, Gori said in a speech at Manulife's Investor Day. Total Asian APE sales were US$2.9 billion in 2020.

The gap between the amount of life insurance people need and have is set to increase 55% by 2030 in Asia, providing a potential pool of US$350 billion in annual premiums, Gori said.

Wealth and asset management also have a “tremendous opportunity,“ given the rapid growth in net household wealth in Asia, and that a much greater proportion of this is held in cash than in North America, he added.

“All of these targets do not incorporate any M&A,“ he said. “If there are opportunities to transact, we would absolutely consider them. But that’s not our area of focus.”

Dividend increases, rather than deals, will be the first priority for Manulife's C$23 billion (RM77 billion) of excess capital, he said.

The company also aims to reduce the contribution of its long-term care and variable annuities businesses to less than 15% of core earnings from 25% in 2020. – Reuters



Source: The Sun Daily

US consumer confidence hits highest point since start of pandemic: Survey

WASHINGTON: US consumers are growing more upbeat about the economy and job prospects, with confidence rebounding to the highest point since the start of the pandemic, according to a survey released on Tuesday.

And even as they become more wary about rising prices, that has not dampened enthusiasm, according to The Conference Board's monthly report showing the consumer confidence index jumped to 127.3 in June – the highest since February 2020 before Covid-19 shuttered the global economy.

And the index for May was revised up nearly three points to 120.0, the survey showed.

“Consumer confidence increased in June and is currently at its highest level since the onset of the pandemic’s first surge in March 2020,“ said Lynn Franco, senior director of economic indicators at The Conference Board.

Sentiment improved for current conditions as well as the six-month outlook with Americans “buoyed by expectations that business conditions and their own financial prospects will continue improving in the months ahead,“ Franco said in a statement.

Oren Klachkin of Oxford Economics credited the progress on containing Covid-19 in the United States.

“Low virus transmission, vaccinations, and expanded reopenings made consumers much more confident,“ he said in an analysis. “Consumers are coming out of their shell.”

The measures of current business conditions and job prospects jumped several points each.

And though the outlook for inflation also continues to creep higher, that has had “little impact” on buying plans.

“In fact, the proportion of consumers planning to purchase homes, automobiles, and major appliances all rose – a sign that consumer spending will continue to support economic growth in the short-term,“ Franco said.

“Vacation intentions also rose, reflecting a continued increase in spending on services.”

The US housing market has been on fire for months due to rock-bottom borrowing rates, but the short supply has caused prices to soar.

In a separate report, the S&P CoreLogic Case-Shiller Indices showed home prices soared 14.6% in the 12 months ended in April, the 11th consecutive month of price increases and the highest reading in 30 years. – AFP



Source: The Sun Daily

United Airlines unveils aircraft order worth US$35.4 billion at listed prices

NEW YORK: United Airlines announced the largest order in its history on Tuesday, unveiling major purchases from Boeing and Airbus in a significant bet on a travel industry's recovery from Covid-19.

The US carrier plans to acquire 270 new planes consisting of 200 Boeing aircraft and 70 Airbus jets, in an order valued at US$35.4 billion (RM147 billion) based on the listed price of the jets, although airlines often end up paying much less than the list price.

United executives described the order as a landmark moment symbolising the radically improved outlook for travel due to access to coronavirus vaccines.

Still, United and other major airlines are expected to report another quarterly loss for the April-June period when they release their earnings reports in July, due to the continued drag from the crisis that has devastated travel revenue for more than a year.

United's business travel volumes are still down 60%, with international travel off even more, United Chief Executive Scott Kirby said.

“We’re not back to 100%,“ Kirby said during a conference call with reporters in which he outlined how the company leaders had strategised early in the pandemic.

“Because we accurately mapped out the trajectory of the crisis in March and April of last year, it’s really allowed us to be prepared and make the right short- and long-term decisions,“ he said.

During the hour-long conference call, company officials were not asked about the so-called Delta virus variant – which is spreading rapidly in many parts of the world leading to some renewed restrictions – but the announcement illustrates broad confidence in the industry's prospects even as the pandemic evolves.

Investors initially cheered the announcement, lifting United shares 0.6% to US$52.81 in early trading, but prices later dipped. Boeing gained but Airbus lost ground.

The biggest component of United's order is for 150 of Boeing's new 737 MAX 10, which is still undergoing tests in a process closely monitored by US air safety regulators. The announcement is a victory for Boeing, after the jet was grounded for 20 months following two deadly crashes.

The order also includes 50 Boeing 737 MAX 8 and 70 Airbus A321neo planes.

All three models are narrow-body jets, making them well-suited for domestic and shorter-distance trips that have been among the first to see passenger numbers recover from the Covid-19 pandemic.

“We are truly humbled by United Airlines’ confidence in the people of Boeing and the airplanes we design and build every day,“ said Stan Deal, president and CEO of Boeing Commercial Airplanes.

Airbus chief commercial officer Christian Scherer said, “Such a significant order from a great airline like United underscores that the A321neo offers unmatched capabilities, operating economics, and passenger friendliness.”

Both the Airbus model and the next-generation 737 MAX are bigger than earlier versions of the same aircraft, a feature especially beneficial for increasing capacity in New York, San Francisco and other markets where adding more flights is difficult or impossible, United officials said.

The officials made clear that they have seen very recent signs of an acceleration in business travel bookings, with firms eager to resume client visits as they see their competitors returning to the skies.

Airline executives said they also were bullish about a recovery in international travel, pointing to the summer of 2022 as a likely “record breaker” as US consumers make up for lost opportunities during the pandemic to visit Europe and Asia.

The new planes will include enhanced in-flight entertainment options aiming to delight consumers with access to games and thousands of shows and movies.

In another step to please consumers, United plans to upgrade its existing fleet of narrow-body planes to add more space for onboard luggage.

Richard Aboulafia, an aviation expert at Teal Group, said purchases of the A321 and the 737 MAX – both single-aisle planes – make sense for the airline in the current market. “The domestic markets are coming back pretty fast and fuel prices are coming back fast too.”

Airlines must make long-term bets to remain competitive, even if current market conditions still present significant problems, Aboulafia said, adding that current low interest rates also encourage making purchases now.

Scott Hamilton of Leeham News, an aviation website, said he was surprised at the size of the order. Boeing likely provided United an appealing discount because the company “has to rebuild its order book” after the MAX crisis, he said. – AFP



Source: The Sun Daily

Tuesday, June 29, 2021

AirAsia group ramps up cargo services with Freightchain’s digital interlining

The group said its cargo services are managed by its logistics venture, Teleport, which has also adopted Freightchain. — AFP pic
The group said its cargo services are managed by its logistics venture, Teleport, which has also adopted Freightchain. — AFP pic

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KUALA LUMPUR, June 29 — Airlines under the AirAsia Group have made available cargo spaces on their flights on Freightchain, the world’s first digital air cargo network based on blockchain, in an effort to further strengthen its cargo footprint across the region.

The group said its cargo services are managed by its logistics venture, Teleport, which has also adopted Freightchain in order to provide AirAsia and other airlines a platform to increase their cargo capacity utilisation.

In a statement today, the airline said with Freightchain, AirAsia is now able to fully interline its flights digitally with other airlines, allowing for a faster and more on-demand connectivity to transport cargo across Southeast Asia and beyond.

Chief executive officer Tan Sri Tony Fernandes said the listing of AirAsia on Freightchain supports the goal to be a formidable and reputable digital cargo distributor in the region, providing customers the best services through a comprehensive flight network at the lowest possible cost.

“The ability to maximise cargo revenue through digital interlining is a game changer for the cargo industry. Freightchain provides an avenue to connect multiple airlines and destinations, opening up revenue opportunities for airlines and limitless connections for shippers through Freightchain’s interlining solution.

“All of our AirAsia Group airlines are now listed on Freightchain and we welcome other airlines to come on board to create an amazing digital space for the global cargo network,” he said.

Fernandes said the belly capacity utilisation of scheduled commercial flights is often below 100 per cent, at times about 50 per cen.

“(Hence) there is a huge opportunity for airlines to leverage on demand interlining on Freightchain to fill the belly space to deliver significant convenience so they would never have to fly empty,” he said.

He said AirAsia’s digital transformation to become more than just an airline has been gaining strong momentum.

“On the cargo and logistics front, we have established Teleport that will utilise cargo spaces not only on our AirAsia flights but also other airlines, and this provides great synergy to our business.

“We are making it possible for businesses to transport cargo to places outside our network and the region like Moscow and Brussels,” he shared.

AirAsia said that as the Freightchain platform runs on blockchain, it allows airlines to manage shipment bookings on their own, from finalising consignment details all the way to rescheduling.

The payment and settlement process is also simplified and secured with various methods including via wallet top up, credit card or even deferred payment.

To date, Freightchain has on-boarded 10 airlines along with their agents and forwarders, including all of AirAsia Group’s airlines based in the ASEAN region, the airline added. — Bernama




Source: Malay Mail

Bank Rakyat introduces Ar-Rahnu e-appointment service

Bank Rakyat customers may begin using the eAppointment platform starting July 1. — Picture by Choo Choy May
Bank Rakyat customers may begin using the eAppointment platform starting July 1. — Picture by Choo Choy May

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KUALA LUMPUR, June 29 —Bank Rakyat is introducing eAppointment, an online Ar-Rahnu appointment service to alleviate the congestion at its branches and prevent the spread of Covid-19.

Starting July 1, 2021, customers can use the eAppointment platform to schedule an appointment at the bank’s 140 branches through 46 Ar-Rahnu X’Change nationwide by visiting  https://appointment.bankrakyat.com.my.

In a statement today, chief executive officer Datuk Syed Abdul Aziz Syed Hassan said the new system allows customers to set a date, time and location for their appointment with ease, adding that the service will benefit the bank’s 356,000 Ar-Rahnu account holders.

“During this pandemic, gold items can be mortgaged for cash.

“Apart from helping to improve the customer’s cash flow, Ar-Rahnu also acts as an alternative financing option for businesses, micro-entrepreneurs as well as small and medium enterprises which are struggling with liquidity due to the pandemic’s impact on the economy.

“With a payment margin of up to 80 per cent from the pawned items, customers only need to make an appointment through eAppointment to get fast cash,” he said. — Bernama




Source: Malay Mail

Euro zone bonds steady ahead of German inflation data

Investors have been keeping a close eye on inflation figures and what they may mean for continued central bank stimulus, and German consumer prices have been consistently above the ECB’s target of just below 2 per cent. A Reuters poll suggests the figure for June, due out at 1200 GMT, would be no different, at 2.3 per cent. — Reuters pic
Investors have been keeping a close eye on inflation figures and what they may mean for continued central bank stimulus, and German consumer prices have been consistently above the ECB’s target of just below 2 per cent. A Reuters poll suggests the figure for June, due out at 1200 GMT, would be no different, at 2.3 per cent. — Reuters pic

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LONDON, June 29 — Euro zone government bond yields held steady near recent highs today ahead of the release of German consumer price data, with polls suggesting that inflation in Europe’s largest economy will overshoot the European Central Bank’s target for the bloc.

Investors have been keeping a close eye on inflation figures and what they may mean for continued central bank stimulus, and German consumer prices have been consistently above the ECB’s target of just below 2 per cent. A Reuters poll suggests the figure for June, due out at 1200 GMT, would be no different, at 2.3 per cent.

Various other German states are due to report their own inflation figures through the day, and the country’s most populous state, North Rhine Westphalia (NRW), has already recorded inflation of 2.5 per cent in June compared to a year before.

“Our economists expect the reopening (of economies) to continue to pressure services prices higher and make goods prices more prone to the feed-through of rising input prices,” ING analysts said in a note.

Euro zone government bond yields were briefly higher after the NRW data came out early today, but settled back to trade flat, hovering near recent highs.

Germany’s 10-year bond yield, for example, was flat at -0.187 per cent; within sight of a recent one-month high of -0.146 per cent, yet not close enough to warrant any concern.

French 10-year bond yields, which fell sharply after far-right politician Marine Le Pen fared badly in regional elections over the weekend, were also steady at 0.159 per cent.

The reason for the subdued mood is that euro zone policymakers have been at pains to show they will not act immediately on any spikes in inflation that they see as transitory or led by oil prices, analysts say.

“The ECB’s assurances mean that there is little that could upset the cart in rates until at least September when policymakers are again to decide on the pace of asset purchases,” the ING analysts said.

Yet, German 10-year yields have risen nearly 40 basis points this year so far, suggesting that each inflation figure is pointing towards a larger rebound and an eventual clawing back of stimulus.

Later today, the European Union is widely expected to launch and price its second issuance under the Next Generation EU (NGEU) programme. It is planning to sell 5 year and 30-year bonds, with investors expecting it to raise between €15 and €20 billion. — Reuters




Source: Malay Mail

Bursa Malaysia gets boost from Hartalega, Top Glove

At 3.10pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 3.34 points higher at 1,548.05 from yesterday’s close of 1,544.71. ― Picture by Hari Anggara
At 3.10pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 3.34 points higher at 1,548.05 from yesterday’s close of 1,544.71. ― Picture by Hari Anggara

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KUALA LUMPUR, June 29 ― Gains in Hartalega and Top Glove helped to boost Bursa Malaysia higher at mid-afternoon.

At 3.10pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 3.34 points higher at 1,548.05 from yesterday’s close of 1,544.71.

The market bellwether opened 2.32 of-a-point lower at 1,542.39.

On the broader market, gainers surpassed losers 468 to 410, while 443 counters were unchanged, 900 untraded, and 67 others suspended.

Turnover stood at 3.45 billion units valued at RM1.72 billion.

Heavyweights Hartalega inched up 25 sen to RM7.55, Top Glove rose 10 sen to RM4.33, Sime Darby increased seven sen to RM2.20 and IHH was four sen higher at RM5.66.

Conversely, PetChem lost seven sen to RM8.05 and Genting Malaysia declined four sen to RM2.82.

Of the actives, newly-listed Nestcon increased 4.5 sen to 32.5 sen and Serba Dinamik recovered one sen to 33.5 sen.

On the index board, the FBM Emas Index improved 33.25 points to 11,250.59, the FBMT 100 Index increased 32.84 points to 10,970.81, and the FBM Emas Shariah Index rose 58.93 points to 12,306.41.

The FBM ACE was 89.93 points better at 7,085.47 and the FBM 70 added 79.49 points to 14,552.72.

Sector-wise, the Financial Services Index improved 7.63 points to 15,164.60, the Industrial Products and Services Index was 0.41 of-a-point higher at 187.36, and the Plantation Index increased 20.47 points to 6,451.50. ― Bernama




Source: Malay Mail

Stats Dept: Eight states record better growth performance in 2020

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KUALA LUMPUR, June 29 —  Although all fourteen states, including the Federal Territories, recorded negative growth in 2020, eight states recorded a better Gross Domestic Product (GDP) growth rate compared with the national GDP contraction of 5.6 per cent.

Department of Statistics Malaysia (DOSM) chief statistician Datuk Seri Mohd Uzir Mahidin said the eight states were the Federal Territory of Labuan, which recorded a decrease of 0.5 per cent, followed by Kelantan (-1.1 per cent), Kedah (-1.7 per cent), Penang (-2.1 per cent), Perak (-2.3 per cent), Negri Sembilan (-3.6 per cent), Johor (-4.6 per cent) and Selangor (-5.3 per cent).

Meanwhile, the Federal Territory of Kuala Lumpur recorded a decline of -7.5 per cent, Sarawak (-7.1 per cent), Sabah (-9.5 per cent), Pahang (-5.9 per cent), Melaka (-5.9 per cent), Terengganu (-5.7 per cent), and Perlis (-6.1 per cent).

“Although the Covid-19 pandemic has negatively impacted most state economies, six states — Selangor, Kuala Lumpur, Johor, Sarawak, Penang and Sabah — remain as major gross domestic product (GDP) contributors to the nation, with a combined contribution of 72.1 per cent,” said Mohd Uzir.

He said this during the virtual press conference on the Economic Performance by State 2020 today. — Bernama




Source: Malay Mail

Bursa Malaysia slightly higher at lunch break

At 12.30pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 0.97 of-a-point higher at 1,545.68 from yesterday’s close of 1,544.71. — Bernama pic
At 12.30pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 0.97 of-a-point higher at 1,545.68 from yesterday’s close of 1,544.71. — Bernama pic

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KUALA LUMPUR, June 29 ― Bursa Malaysia's key index ended the morning trading session slightly higher, though its gains were capped by losses in financial and consumer products and services counters.

At 12.30pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) was 0.97 of-a-point higher at 1,545.68 from yesterday’s close of 1,544.71.

The market bellwether opened 2.32 of-a-point lower at 1,542.39 and fluctuated between 1,541.72 and 1,548.64 throughout the session.

On the broader market, gainers surpassed losers 452 to 386, while 434 counters were unchanged, 948 untraded, and 67 others suspended.

Turnover stood at 2.94 billion units valued at RM1.34 billion.

In a statement, Rakuten Trade said it believes that the announcement of the RM150 billion PEMULIH economic stimulus package would have minimal impact on the market.

Thus, it expects the index’s performance to be quite subdued and trend within the 1,540-1550 range today.

An analyst said the market staged a tepid rebound following mild bargain hunting activities in selected lower liners and blue chips.

Regional peers were in the red with Singapore's Straits Times Index losing 0.97 per cent to 3,096.47, Japan's Nikkei easing 0.9 per cent to 28,786.29 and China's Hang Seng Index 0.77 per cent weaker at 29,043.02.

The United States stock markets closed on a mixed note as the Dow fell 0.4 per cent, while the S&P 500 gained 0.2 per cent and Nasdaq was 1.0 per cent higher, boosted by the gains in technology shares.

Back home, heavyweights Maybank and Public Bank lost one sen to RM8.13 and RM4.14, respectively, PetChem was five sen weaker at RM8.07 and TNB dropped three sen to RM9.82.

Genting Malaysia declined four sen to RM2.82 and Genting Bhd dipped six sen to RM4.94.

Conversely, Hartalega gained 16 sen to RM7.46, while Press Metal and Sime Darby increased six sen to RM4.85 and RM2.19, respectively.

Of the actives, newly-listed Nestcon increased five sen to 33 sen, Serba Dinamik recovered 1.5 sen to 34 sen, and MMAG was flat at 13.5 sen.

On the index board, the FBM Emas Index improved 17.49 points to 11,234.83, the FBMT 100 Index increased 15.70 points to 10,953.67, and the FBM Emas Shariah Index rose 47.39 points to 12,294.87.

The FBM ACE was 107.48 points better at 7,103.02 and the FBM 70 added 55.39 points to 14,528.62.

Sector-wise, the Financial Services Index gave up 19.54 points to 15,137.43, the Industrial Products and Services Index was 0.48 of-a-point higher at 187.43, and the Plantation Index increased 16.39 points to 6,447.42. ― Bernama




Source: Malay Mail