Market Daily Report: KLCI ends on flat note

KUALA LUMPUR (Oct 21): The FBM KLCI fell to a low of 1,565.08 points today before recouping to close at a marginal 0.01% drop on Monday, following the decline in US equities on Friday (Oct 18).

At 5pm, the benchmark index finished 0.22 points down at 1,570.93. Main decliners were AMMB Holdings Bhd and Genting Bhd, which fell to close 1.99% and 1.05% lower respectively.

Market breadth was negative with more losers than gainers at 435 versus 383 at the end of the trading day. Total turnover stood at a total of 2.58 billion shares, worth RM1.48 billion.

Inter-Pacific Securities Sdn Bhd's head of research Pong Teng Siew told theedgemarkets.com that the key index’s performance today was a “knee-jerk reaction” to the fall in US equities, coupled with the “lack of driving factors locally”.

In China, the Shanghai Stock Exchange Composite Index was up 0.05% at its close, while Hong Kong’s Hang Seng Index rose 0.02% at the end of trading day after Chinese bourses revised rules to allow mainland investors to buy Hong Kong-listed dual-class shares for the first time.

Meanwhile, Japan’s Nikkei 225 ended the day with a 0.25% gain, while South Korea’s Kospi finished 0.20% higher.

Reuters said Asian shares were mostly higher on Monday, supported by hopes for progress in resolving the US-China trade war.

Chinese vice premier Liu He on Friday said Beijing will work with the United States to address each other’s concerns, and that stopping the trade war would be good for both sides and the world, it reported.

Also on Friday, US President Donald Trump said he thinks a trade deal between the United States and China will be signed by the time Asia-Pacific Economic Cooperation meetings take place in Chile on Nov 16 and 17, it added.



Source: The Edge

Market Daily Report: FBM KLCI finishes down on China GDP as planters fall

KUALA LUMPUR (Oct 18): The FBM KLCI ended 3.35 points or 0.21% lower today at 1,571.15 after China said its economy, as measured by Gross Domestic Product (GDP), grew 6% in the third quarter of 2019 (3Q2019) from a year earlier.

China's 3Q2019 GDP growth, which missed market forecast, slowed from 2Q2019's 6.2% expansion. Such sentiment weakened world markets because China is the world's second-largest economy and also a major importer of global goods.

Reuters reported that China's economic growth slowed more than expected to 6% year-on-year in 3Q2019, the weakest pace in at least 27½ years, as demand at home and abroad faltered amid a bruising US-China trade war.

It was reported that analysts polled by Reuters had forecast China's GDP to grow 6.1% in the July-September quarter from a year earlier. "Asian stocks stumbled on Friday, erasing earlier gains after China posted its weakest growth in nearly three decades, countering a global lift in sentiment on the UK and European Union striking a long-awaited Brexit deal," Reuters reported.

In Malaysia today, fund managers said a lack of market catalysts could have also resulted in the lower KLCI close.

“Despite the developments around Brexit, trade talks between US and China and the optimism from (Malaysia's) Budget 2020, the market declined due to a lack of catalysts,” Areca Capital Sdn Bhd chief executive officer Danny Wong Teck Meng told theedgemarkets.com.

Across Bursa Malaysia, 2.96 billion shares were exchanged for RM2.23 billion as plantation companies ended among top decliners. These included Genting Plantations Bhd, United Plantations Bhd and IOI Corp Bhd.

Gainers were led by Aeon Credit Service (M) Bhd, Scientex Bhd and Heineken Malaysia Bhd. Aeon Credit closed up 80 sen or 5.13% at RM16.40.



Source: The Edge

Market Daily Report: FBM KLCI ends on tepid note as no news on US-China trade deal

KUALA LUMPUR (Oct 17): The FBM KLCI closed 0.03% or 0.4 points lower to 1574.50 as the broader market was mostly lukewarm today, in line with the region, on a lack of updates on the US-China trade deal.

The benchmark index saw 2.33 billion shares traded at RM1.88 billion today.

TA Securities Holdings Bhd senior technical analyst Steven Soo told theedgemarkets.com that there was a tug-of-war going on as the KLCI closed in negative territory, with bargain hunting going on for mega blue chips.

“Nevertheless, the index is still holding up pretty well, despite mixed signals on the external market,” he said over the phone.

Soo also noted some rotational play going on amongst investors in the market.

“The oil and gas sector continues to be focus, whereas the property sector remains underperforming, perhaps because the recently-tabled Budget 2020 was not enough to boost sentiment,” he added.
Regionally, most markets were also tepid, as hopes of a Sino-US trade deal waned amid a lack of concrete details, Reuters said.

Japan’s Nikkei 225 index dropped 0.09%, while South Korea’s Kospi closed 0.23% lower.
In China, the Shanghai Composite Index ended 0.05% lower, though the Hang Seng was 0.69% higher.




Source: The Edge

Market Daily Report: FBM KLCI ends at intraday high on Brexit optimism

KUALA LUMPUR (Oct 16): The FBM KLCI closed up 8.67 points or 0.55% at its intraday high today while volume across Bursa Malaysia rose past three billion shares after global equities rose in anticipation that the UK and the European Union (EU) could reach a Brexit deal in time for a leaders' summit this week.

At 5pm, the KLCI closed at 1,574.9 after Asian shares ended higher following overnight gains in US stock markets.

Across Bursa today, trading volume was higher at 3.06 billion shares worth RM2.23 billion. Yesterday, trading volume stood at 2.62 billion shares valued at RM1.73 billion.

Today, TA Securities Holdings Bhd wrote in a note "the local market should trade sideways as hopes for a Brexit deal ahead of the month-end deadline offset caution on the certainty of the initial US-China trade deal" amid strong trading momentum in  Bursa lower liners and small market capitalisation (small cap) stocks.

Malacca Securities Sdn Bhd wrote in a report today Bursa's higher share trade volume was due to the gradual return of retail players into the local market.

“The broader FBM Small Cap index has also been making headway of late and we think that run-up still has legs amid the gradual return of retail players that is seeing the overall traded volumes on the rise again. Therefore, we still see more near-term upside as retail players are likely to use this opportunity to undertake more trading activities on previously beaten down lower liners and broader market shares,” Malacca Securities said.

Globally, Reuters reported that most Southeast Asian stock markets rose on Wednesday, tracking broader Asia, as hopes of a deal to avoid a disorderly British exit from the European Union and upbeat US corporate numbers lifted sentiment, with Singapore trading at a two-week high.

"Officials and diplomats involved in negotiations over the acrimonious divorce between the world's fifth-largest economy and its biggest trading bloc said that differences over the terms of the split had narrowed significantly," Reuters said.



Source: The Edge

Market Daily Report: KLCI closes lower as sentiment hit by poor progress in US-China trade talks

KUALA LUMPUR (Oct 15): The FBM KLCI finished in negative territory today due to lack of any significant progress in the ongoing US-China trade talks, as well as profit taking by investors.
The benchmark index closed 1.36 points or 0.09% lower at 1566.23.

On the broader market, there were 410 decliners against 391 advancers. A total of 2.62 billion shares valued at RM1.73 billion exchanged hands.

Hong Leong Investment Bank Bhd analyst Loui Low said today’s trading was mostly sideways, with bouts of profit taking.

“Trading sentiment was also dampened due to China putting a pause on the trade deal, despite the mildly expansionary budget presented (by the Malaysian government) earlier. There is also some rotational play going on,” he told theedgemarkets.com when contacted.

Nevertheless, Loui also noted that there was still some spillover effect from Budget 2020, since beneficiary stocks such as those involved in technology and green initiatives remained positive.
Elsewhere in Southeast Asia, Reuters said most stock markets traded in a flat-to-lower range, as hopes of a Sino-U.S. trade deal subsided after Beijing indicated further talks were needed, while figures from China underlined the damage felt due to trade pressures.



Source: The Edge

Market Daily Report: KLCI ends 0.69% higher as investors cheer Budget 2020, partial trade deal

KUALA LUMPUR (Oct 14): The FBM KLCI closed 10.75 points or 0.69% higher at 1,567.59 points on Monday, buoyed by positive sentiments brought on by the newly-announced Budget 2020 and progress of trade talks between the US and China.

Trading was in the positive territory all day and hit an intra-day high of 1,568.96 points. Nevertheless, the benchmark index remains below the 1,600 psychological level.

Market breadth was positive, with more gainers than losers at 487 versus 367 as trading wraps up for the day, with a total turnover of 2.99 billion shares worth RM1.84 billion.

Malacca Securities Sdn Bhd senior analyst Kenneth Leong told theedgemarkets.com that besides tracking regional markets, gains in the KLCI today were underpinned by the more rosy Budget 2020 announcement last Friday that saw a higher allocation in development expenditure at RM56 billion, versus RM54.7 billion under Budget 2019.

"Market sentiment was also upbeat on the positive progress from the US and China's trade negotiations as both parties are ready to outline phase 1 of their trade deal. As it is, all 13 major sectors finished in the green today.

"Moving forward, the FBM KLCI might see some quick profit taking after three consecutive days of gains before recovering towards the 1,580 resistance level. On the downside, the support is located at the 1,550 level," said Leong.

Elsewhere in the region, the Shanghai Stock Exchange Composite Index closed with a 1.15% gain.
Meanwhile, South Korea's Kospi finished 1.11% higher, while Hong Kong's Hang Seng Index rose 0.81%.

Reuters said Asian stocks firmed on Monday on the back of signs of progress in the Sino-US trade-off, although analysts reminded that the threat to global growth is in fact weak corporate capital expenditure, which may not restart merely from the latest round of agreement between the two countries.

Sentiment was boosted when US President Donald Trump outlined the first phase of a deal to end a trade war with China and suspended a tariff hike, though officials on both sides said much more work needed to be done.

The emerging deal, covering agriculture, currency and some aspects of intellectual property protections, would represent the biggest step by the two countries in 15 months, it added.



Source: The Edge

Malaysia Budget 2020 Highlights - Updated

KUALA LUMPUR (Oct 11): The following are the highlights of Budget 2020:
Malaysian economy

• Budget 2020 has four thrusts including boosting economic growth in new economy and digital era, investing in people.
• Approved foreign direct investment has inreased to RM80.1 billion in 2018 from RM54.1 billion in 2017.
• Proctrated trade war offers Malaysia unique opportunity to become choice destination for FDI with high added value
• Overall debts and liabilities ratio to GDP lowered to 75.4% in 2018 from 79.3% in 2017, but is expected to rise to 77.1% as at end-June 2019. This is largely due to the increase in the committed government guarantee to continue to MRT and Pan Borneo Highway, and RM20 billion bailout of Tabung Haji. Govt saved at least RM46 billion in capex from rationalising megaprojects including LRT3, MRT 2 and ECRL.
• Malaysian economy to grow at 4.8% in 2020 vs 4.7% in 2019
• The government revises Budget 2020 deficit target to 3.2% of GDP, which is slightly higher than the 3% originally announced in Budget 2019.
• Lower public revenue in 2020 in absence of Petronas special dividend
• Government expects RM26.8 billion SST collection in 2019
• Government's tax revenue up 3.4% to RM180 billion in 2019
• With weakening growth in government revenue, tax reforms necessary
• Higher development expenditure of RM56 billion
• Only 1% growth on exports in 2020
• Malaysia’s current account surplus to narrow to 1.9% of 2020 GNI
• 2% inflation in 2020, to be lifted by the introduction of targeted fuel subsidy
• Unemployment rate to remain healthy at 3.3% in 2020
• Service sector to be the fastest-growing sector of the economy
• 4.1% growth in the manufacturing sector in 2020
• Agriculture sector to grow the slower pace at 3.4%
• Stronger growth of 3.7% in construction sector in 2020, vs 1.7% in 2019
• Mining sector growth to moderate to 0.3%
• Govt will sell assets (approved previously) via competitive bidding to realise their potential; this is expected to generate more than RM3 billion revenue in 2020.

Government

• The Bureau of Public Complaints will be replaced by the Malaysian Ombudsman to enhance govt's governance and delivery systems
• Govt to move forward with the formation of the Independent Police Complaints and Misconduct Commission (IPCMC) to increase public confidence and trust in police.
• Japan Bank for International Cooperation (JBIC) offers to guarantee additional tranche of Samurai bonds with lower interest rate of less than 0.5% compared with 0.63% previously. The federal government plans to issue the bonds early next year. Issuance size to be determined after further discussion with JBIC.
• Home Ministry to receive RM16.9 billion boost for 2020.
• Allocation for Islamic affairs under PM's Dept increased to RM1.3 billion from 1.2 billion in 2019
• Govt has set up National Committee on Investments (NCI), chaired by Minister of Finance and Minister of International Trade and Industry
• Allocation for Defence Ministry raised from RM13.9 billion in 2019 to RM15.6 billion in 2020

1MDB

• Bandar Malaysia project will now include a People's Park, with 5,000 units of affordable homes and greater Bumiputera participation. Proceeds from the project will be valued and announced in due course, and will be used to reduce 1MDB's debts.
• Govt to pay RM2.4 billion to service 1MDB and SRC International's debt interest in 2019, and a further RM2.7 billion in 2020

Corporate, finance and fintech

• Govt will continue to ensure at least 30% of tenders of each ministry are reserved for only Bumiputera contractors
• 50% matching grant of up to RM5,000 to increase the digitalisation of operations for Malaysian small and medium enterprises (SME)
• RM50m allocation proposed to encourage SMEs to engage in more export promotion activities
• Govt to provide extra RM50m for SC's My Co-Investment Fund (MyCIF) to assist SMEs that have difficulties in getting financing
• Govt to merge Bank Pembangunan Malaysia, Danajamin Nasional, SME Bank and EXIM Bank Malaysia to restructure development financial institutions (DFI)
• Govt allocates RM1 billion in investment incentives to attract Fortune 500 companies and global unicorns
• Govt to offer special investment incentive package worth RM1b per year for five years to local companies capable of penetrating overseas market
• Additional RM10m allocation to be set aside for MITI to increase monitoring to ensure approved investments are realised
• Government evaluating Carey Island development feasibility for next growth phase
• Govt intends to develop a 100-acre logistics hub at Special Border Economic Zone at Kota Perdana in Bukit Kayu Hitam to strengthen trade relations with Thailand
• National Fiberisation & Connectivity Plan will adopt public-private partnership approach involving total investment of RM21.6b
• RM20m allocation for Cradle Fund to train and offer grants to high-impact technology entrepreneurs
• Licensing for digital banks to be opened for public consultation by year end. A framework is expected to be released in 1H2020
• Digital bank licensing framework will be finalised by Bank Negara and open for application in the first half of 2020
• Govt to allocate additional RM50 million to Malaysia Co-Investment Fund (MyCIF) to benefit equity crowdfunding platforms and peer-to-peer (P2P) financing platforms.
• Ceiling on Market Development Grant (MDG) by Malaysia External Trade Development Corporation (Matrade) raised to RM300,000. Cap on entry to export exhibitions also raised to RM25,000. RM50 million allocated to encourage SMEs to join promotional activities.

Entrepreneur

• RM445m Bumiputera entrepreneur development grant for access to financing, provision of business premises, entrepreneurship training
• Govt to provide loans worth RM100m under Small Industries Entrepreneurs Financing Scheme for Chinese community
• Govt to provide RM20m in loans under entrepreneur development scheme for Indian community
• Govt to allocate RM500m as guaranteed facility for women entrepreneurs via Syarikat Jaminan Pembiayaan Perniagaan Bhd (SJPP)
• Skim Jaminan Pinjaman Perniagaan will be enhanced, with the government guarantee raised to 80% of the loan amount while the guarantee fee is reduced to 0.75%. A RM500 million guarantee facility has been set aside especially for women entrepreneurs.
• SME Bank will introduce two new funds: a RM200m fund specially for women entrepreneurs, and a RM300m fund to support SMEs with potential to become regional champs
• Ministry of Entrepreneur Development to give RM10 million for advisory services and awareness for the halal industry
• Tax incentives for venture capital and angel investors will be extended until 2023
• Govt jobs worth RM1.3b dedicated for Bumiputera contractors

Internet and tech

• Mandatory Standard on Access Pricing (MSAP) has successfully reduced broadband prices by 49% and increased speeds by three times
• RM250m will be set aside by MCMC to prepare broadband access via satellite technology to increase connectivity in rural Malaysia, especially Sabah and Sarawak
• Matching grant fund of RM25m will be set aside to encourage more pioneer digital projects that benefit fibre optic infrastructure and 5G
• RM20m allocated to MDEC to groom local champions in producing digital content
• RM50 million grant to develop 5G ecosystem to prepare for 5G transformation worldwide
• Smart automation matching grant (up to RM2m) for 1,000 local manufacturers and 1,000 services companies to automate business processes
• To boost use of e-wallets, govt to offer one-time RM30 digital stimulus to qualified Malaysians aged 18 and above with annual income less than RM100,000
• 14 one-stop digital improvement centres to be set up in every state to faciltiate access to financing, development of business capacity
• RM10m to be set aside for MDEC to train micro-digital entrepreneurs and technology experts to leverage e-market places, social media platforms
• Digital Social Responsibility (DSR) is commitment from business sector to enhance workforce with digital skills needed by society. Contributions from the private sector to the DSR will be given tax
• R&D in public sector to be intensified with RM524 million allocation to ministries, public agenciesexemptions.
• Government to up e-sports allocation to RM20m due to high potential
• Green Investment Tax Allowance (GITA) and Green Investment Tax Exemptions (GITE) extended to 2023 in line with sustainable development

Palm oil

• Govt has launched palm oil replanting loan fund worth RM550m for smallholders
• Govt to implement B20 biodiesel for the transport sector by end-2020. This is expected to increase palm oil demand by 500,000 tonnes per annum.

Rubber

• RM200m set aside for 'Bantuan Musim Tengkujuh' to eligible rubber smallholders under RISDA, Lembaga Industri Getah Sabah
• RM100 million allocated for Rubber Production Incentive in 2020 to enhance income of smallholders faced with low rubber prices

Agriculture

• Allocation for Agriculture and Agro-based Industry Ministry increased to RM4.9 billion, including RM150 million to support plant integration programmes such as for chilli, pineapple, coconut, watermelon and bamboo.
• RM855 million allocation under Federal Government Padi Fertilizer Scheme to boost padi yield

Civil servants

• Civil servants’ emoluments to exceed RM82 billion
• Civil servant pension will cost RM27.1 billion
• Civil servants' cost of living allowance or COLA to be raised by RM50 a month starting 2020 for support group, with an additional RM350 million a year
• Civil servants will be allowed early redemption of accumulated leaves (gantian cuti rehat) for up to 75 days as replacement pay for those who have served at least 15 years
• Govt announces RM500 special payment for civil servants Grade 56 and below. Govt retirees to get special payment of RM250, also extended to non-pensionable veterans
• Govt to allocate RM330 million to the Property and Land Management Division under the Prime Ministers Department to repair and maintain the public service quarters. Meanwhile, RM150 million and RM250 million is set aside to repair and refurbish Malaysian Armed Forces family housing units (RKAT) and PDRM quarters.
• Fire fighters to get a special allowance of RM200 a month, which will benefit 14,400 personnel under the Fire and Rescue Dept, amounting to RM35 mil.

Highway and tolls

• The Cabinet has approved the proposed offer to acquire four highways in the Klang Valley – Shah Alam Expressway (KESAS), Damansara-Puchong Expressway (LDP), Sprint Expressway (SPRINT) and SMART Tunnel (SMART) to be funded via Government-guaranteed borrowings.
• Citizens to enjoy average 18% discount on all PLUS highways
• Effective Jan 1, 2020, toll rates for cars at the Second Penang Bridge will be reduced from RM8.50 to RM7.00.

Public transport

• RM450 million proposed to acquire up to 500 electric buses for public transport in selected cities nationwide
• Govt intends to proceed with the Rapid Transit System (RTS) between Johor Bahru and Singapore.
• It will also invest RM85 million beginning 2020 to ease congestion at the Causeway and 2nd Link by enhancing vehicle and traffic flow through the Customs, Immigration and Quarantine Complex.

Fuel subsidy

• Individuals owning not more than two cars and two motorcycles can get fuel subsidy for one vehicle. The qualifying criteria are:
  • A passenger car with 1,600cc engine capacity and below, or
  • Any car above 1,600cc must be more than 10 years old, or
  • A qualified motorcycle must be 150cc and below, or
  • Any motorcycles above 150cc must be more than 7 years old.
• From January 2020, the targeted fuel subsidy or PSP will be launched in Peninsular Malaysia with two eligible categories as follows:
  • For eligible recipients of the BSH, the petrol subsidy receivable will be RM30 per month for car owners and RM12 per month for motorcycle owners. This subsidy will be in the form of cash transfer, deposited into the recipient's bank account every 4 months. The first payment will be made in April 2020 for the period January to April 2020; and
  • For all other motorists who are not BSH recipients, they will receive a special Kad95 which allows them to enjoy the fuel subsidy at a discount of 30 sen per litre limited to 100 litres per month for cars or 40 litres per month for motorcycles when purchasing RON95 at the petrol station. The Kad95 will be implemented progressively during the first quarter of 2020.

Taxes

• Govt will merge Special Commissioner of Income Tax and Customs Appeal Tribunal into the Tax Appeal Tribunal, to be operational in 2021. Through this, taxpayers unhappy with the decision of IRB director-general or the Customs D-G can appeal
• Govt proposes that a new band for taxable income in excess of RM2 million be introduced and taxed at 30%, up 2 percentage point from the current 28%. This will affect approximately 2,000 top income earners in the country.
• Govt has repaid GST refunds amounting to RM15.9b to more than 78,000 companies, and income tax refunds of RM13.6b to 448,000 companies and 184,000 taxpayers

Medical and Healthcare

• To support local medical device industry, government will introduce an initiative to encourage local producers to upgrade equipment and tools used in public clinics and hospitals, based on a minimum allocation of 30%.
• RM227m to be set aside to upgrade medical equipment, and RM95m to renovate infrastructure and medical facilities, like in Hospital Pontian
• RM1.6 billion to build new hospitals and upgrade existing ones. The hospital includes Tengku Ampuan Rahimah Klang, Hospital Kampar, Hospital Labuan and the Queen Elizabeth II Hospital, Sabah Heart Centre.
• Govt to allocate RM60m for pneumococcal vaccination for all children
• RM319m to build and upgrade health and dental clinics and quarters facilities; new clinics will be built in Setiu, Sg Petani, and Cameron Highlands, as well as Kudat and Tawau in Sabah, and Lon San and Sg Simunjan in Sarawak
• Health Ministry to get RM30.6 billion allocation, compared to RM28.7 billion under Budget 2019

MySalam

• MySalam to be expanded so that those with critical illnesses will get RM8,000 cash; those being treated in govt hospitals can also claim RM50 wage replacement a day for up to 14 days

Islamic finance

• Islamic Economic Blueprint to be formulated to position Malaysia as centre of excellence for Islamic finance
• Special Islamic Finance Committee to be set up to develop the Islamic finance ecosystem

FELDA

• An allocation of RM810 mil for Federal Land Development Authority (Felda) settlers, including boosting their water supply and roadwork upgrades, and programmes to increase their earnings.

Property and housing

• RPGT base year for asset purchase revised to Jan 1, 2013 for asset acquired before that date
• To reduce supply overhang of condominiums and apartments amounting to RM8.3 billion in the second quarter of 2019, govt will lower the threshold on high rise property prices in urban areas for foreign ownership from RM1 million to RM600,000 in 2020.
• Govt to extend Youth Housing Scheme administered by Bank Simpanan Nasional from Jan 1, 2020 until Dec 31, 2021. The scheme also offers a 10% loan guarantee via Cagamas to enable borrowers to get full financing and RM200 monthly instalment assistance for the first two years, limited to 10,000 home units.
• Public Sector Home Financing Board to offer free personal accident insurance for up to two years to new government housing loan borrowers
• To help those who can't come up with 10% deposit or get financing to buy homes, govt will collaborate with financial institutions to introduce the rent-to-own (RTO) financing scheme, where up to RM10 billion will be provided by the financial institutions, with the governnment supporting via a 30% or RM3 billion guarantee. 
  • This RTO scheme is for purchase of first home up to RM500,000 property price. 
  • Under this scheme, the applicant will rent the property for up to 5 years and after the first year, and the tenant will have the option to purchase the house based on the price fixed at the time the tenancy agreement is signed.

Gaming Industry

• To curb illegal gambling, govt proposes a higher minimum mandatory penalty of RM100,000 for illegal gamblers, along with a minimum mandatory jail sentence of six months.
  • For illegal operators, a higher minimum mandatory penalty of RM1 million and a 12 month minimum mandatory jail sentence will be imposed.
• To curb illegal gambling, govt proposes a higher minimum mandatory penalty of RM100,000 for illegal gamblers, along with a minimum mandatory jail sentence of six months.
• Starting 2020, total number of special draws for Numbers Forecast Operator (NFO) will be reduced from 11 to 8 times a year.

Employment

• Hiring fresh graduates: Two-year pay incentives of RM500 a month. Hiring incentive of RM300 a month.
• Incentives to get women into the workforce:
  • Two-year pay incentive of RM500 a month
  • Hiring incentive of RM300
  • Tax exemption for women returning to work will be extended until 2023.
• Govt revises Employment Act, including increasing maternity leave from 60 days to 90 days from 2021
• Govt proposes to raise minimum wage in urban areas to RM1,200 a month in 2020
• Govt to launch Malaysians @ Work initiative aimed at creating better employment opportunities for youth and women, reducing over-dependence on low-skilled foreign workers
• Malaysians who replace foreign workers will get a monthly wage incentive of RM350/RM500 for two years, depending on the sector. Employers will get a monthly incentive of RM250 a month throughout the same period.

Tourism

• RM25 million allocated to Malaysia Healthcare Tourism Council to strengthen Malaysia's position as the preferred destination for medical tourism in Asean for oncology, cardiology and fertility treatments.
• Govt to contribute RM100 million towards construction of new cable car system to Penang Hill
• RM1.1 billion allocated to Ministry of Tourism and Culture, of which RM90 million is specifically for VMY2020 promotion and programmes

Sabah and Sarawak

• Govt plans to double special alowance for Sabah to RM53.4m and Sarawak to RM32m; this to be doubled further to 106.8m for Sabah and RM64m for Sarawak in five years
• RM587 million allocation for rural water projects, of which RM470 million will be for Sabah and Sarawak
• RM500 million for rural electrification benefiting more than 30,000 rural households, majority in Sabah and Sarawak

Aid and subsidies

• Govt to spend RM24.2 billion on subsidies and social assistance
• RM100 million grant proposed for Malaysian Indian Transformation Unit (MITRA) of which 80% will be programme-based
• RM57 million provided to Orang Asli Development Department (JAKOA), in addition to RM83 million allocation for the community’s economic development, education and infrastructure.
• RM575 million proposed for socio-economic assistance to senior citizens benefiting 137,000 seniors whose household income is below poverty level
• RM25 million allocated to manage, administer and expand food bank programme
• Allocation for subsidies and social assistance increased to RM24.2 billion, including welfare aid such as Bantuan Sara Hidup (BSH). BSH scheme expanded to cover 1.1 million single individuals aged above 40 earning less than RM2,000 per month.

Rural development

• RM10.9 billion allocated for rural development projects in 2020, from RM9.7 billion in 2019
• RM738 million provided for Risda and Felcra to implement income generating programme
• RM1 billion set aside for rural roads throughout Malaysia, primarily targeted at Sabah and Sarawak

Education and training

• Allowance for KAFA teachers increased by RM100 a month, to benefit 33,200 existing teachers
• RM735 million proposed for school maintenance and upgrading works
• Government allocates RM210m to expedite digital infrastructure establishment in public buildings like schools
• Education Ministry to receive largest allocation of RM64.1 billion in 2020 from RM60.2 billion in 2019
• Allocation for TVET programmes raised from RM5.7 billion in 2019 to RM5.9 billion in 2020
• RM1.3 billion proposed for education institutions under MARA, a further RM2 billion for student loans benefitting 50,000 students

Source: The Edge

Malaysia Budget 2020 Highlights

KUALA LUMPUR (Oct 11): The following are the highlights of Budget 2020:

• Civil servants' cost of living allowance or COLA to be raised by RM50 a month starting 2020 for support group, with an additional RM350 million a year
• Civil servants will be allowed early redemption of accumulated leaves (gantian cuti rehat) for up to 75 days as replacement pay for those who have served at least 15 years

• Public Sector Home Financing Board to offer free personal accident insurance for up to two years to new government housing loan borrowers
• The Bureau of Public Complaints will be replaced by the Malaysian Ombudsman to enhance govt's governance and delivery systems
• Govt to move forward with the formation of the Independent Police Complaints and Misconduct Commission (IPCMC) to increase public confidence and trust in police.
• Govt to allocate RM330 million to the Property and Land Management Division under the Prime Ministers Department to repair and maintain the public service quarters. Meanwhile, RM150 million and RM250 million is set aside to repair and refurbish Malaysian Armed Forces family housing units (RKAT) and PDRM quarter

• Govt intends to proceed with the Rapid Transit System (RTS) between Johor Bahru and Singapore.
• ​It will also invest RM85 million beginning 2020 to ease congestion at the Causeway and 2nd Link by enhancing vehicle and traffic flow through the Customs, Immigration and Quarantine Complex.

• To support local medical device industry, government will introduce an initiative to encourage local producers to upgrade equipment and tools used in public clinics and hospitals, based on a minimum allocation of 30%.
• Govt announces RM500 special payment for civil servants Grade 56 and below. Govt retirees to get special payment of RM250, also extended to non-pensionable veterans
• RPGT base year for asset purchase revised to Jan 1, 2013 for asset acquired before that date
• Fire fighters to get a special allowance of RM200 a month, which will benefit 14,400 personnel under the Fire and Rescue Dept, amounting to RM35 mil.
• Allocation for Defence Ministry raised from RM13.9 billion in 2019 to RM15.6 billion in 2020

• RM450 million proposed to acquire up to 500 electric buses for public transport in selected cities nationwide
• Bandar Malaysia project will now include a People's Park, with 5,000 units of affordable homes and greater Bumiputera participation. Proceeds from the project will be valued and announced in due course, and will be used to reduce 1MDB's debts.
• Overall debts and liabilities ratio to GDP lowered to 75.4% in 2018 from 79.3% in 2017, but is expected to rise to 77.1% as at end-June 2019. This is largely due to the increase in the committed government guarantee to continue to MRT and Pan Borneo Highway, and RM20 billion bailout of Tabung Haji. Govt saved at least RM46 billion in capex from rationalising megaprojects including LRT3, MRT 2 and ECRL.
• Govt will sell assets (approved previously) via competitive bidding to realise their potential; this is expected to generat more than RM3 billion revenue in 2020.
• Japan Bank for International Cooperation (JBIC) offers to guarantee additional tranche of Samurai bonds with lower interest rate of less than 0.5% compared with 0.63% previously. The federal government plans to issue the bonds early next year. Issuance size to be determined after further discussion with JBIC.
• Govt to pay RM2.4 billion to service 1MDB and SRC International's debt interest in 2019, and a further RM2.7 billion in 2020

• To curb illegal gambling, govt proposes a higher minimum mandatory penalty of RM100,000 for illegal gamblers, along with a minimum mandatory jail sentence of six months.
  • For illegal operators, a higher minimum mandatory penalty of RM1 million and a 12 month minimum mandatory jail sentence will be imposed.
• Starting 2020, total number of special draws for Numbers Forecast Operator (NFO) will be reduced from 11 to 8 times a year.
• Health Ministry to get RM30.6 billion allocation, compared to RM28.7 billion under Budget 2019
• Govt will merge Special Commissioner of Income Tax and Customs Appeal Tribunal into the Tax Appeal Tribunal, to be operational in 2021. Through this, taxpayers unhappy with the decision of IRB director-general or the Customs D-G can appeal

• Home Ministry to receive RM16.9 billion boost for 2020.
• Govt has repaid GST refunds amounting to RM15.9b to more than 78,000 companies, and income tax refunds of RM13.6b to 448,000 companies and 184,000 taxpayers
• Allowance for KAFA teachers increased by RM100 a month, to benefit 33,200 existing teachers
• Allocation for Islamic affairs under PM's Dept increased to RM1.3 billion from 1.2 billion in 2019
• Govt proposes that a new band for taxable income in excess of RM2 million be introduced and taxed at 30%, up 2 percentage point from the current 28%. This will affect approximately 2,000 top income earners in the country.

• Govt will continue to ensure at least 30% of tenders of each ministry are reserved for only Bumiputera contractors
• The Cabinet has approved the proposed offer to acquire four highways in the Klang Valley – Shah Alam Expressway (KESAS), Damansara-Puchong Expressway (LDP), Sprint Expressway (SPRINT) and SMART Tunnel (SMART) to be funded via Government-guaranteed borrowings.
• Govt to extend Youth Housing Scheme administered by Bank Simpanan Nasional from Jan 1, 2020 until Dec 31, 2021. The scheme also offers a 10% loan guarantee via Cagamas to enable borrowers to get full financing and RM200 monthly instalment assistance for the first two years, limited to 10,000 home units.
• To reduce supply overhang of condominiums and apartments amounting to RM8.3 billion in the second quarter of 2019, govt will lower the threshold on high rise property prices in urban areas for foreign ownership from RM1 million to RM600,000 in 2020.

• Individuals owning not more than two cars and two motorcycles can get fuel subsidy for one vehicle. The qualifying criteria are:
  • A passenger car with 1,600cc engine capacity and below, or
  • Any car above 1,600cc must be more than 10 years old, or
  • A qualified motorcycle must be 150cc and below, or
  • Any motorcycles above 150cc must be more than 7 years old.
• RM100 million grant proposed for Malaysian Indian Transformation Unit (MITRA) of which 80% will be programme-based
• Effective Jan 1, 2020, toll rates for cars at the Second Penang Bridge will be reduced from RM8.50 to RM7.00.
• RM57 million provided to Orang Asli Development Department (JAKOA), in addition to RM83 million allocation for the community’s economic development, education and infrastructure.

• MySalam to be expanded so that those with critical illnesses will get RM8,000 cash; those being treated in govt hospitals can also claim RM50 wage replacement a day for up to 14 days
• Citizens to enjoy average 18% discount on all PLUS highways
• RM575 million proposed for socio-economic assistance to senior citizens benefiting 137,000 seniors whose household income is below poverty level
• Govt to allocate RM60m for pneumococcal vaccination for all children
• RM25 million allocated to manage, administer and expand food bank programme

• RM227m to be set aside to upgrade medical equipment, and RM95m to renovate infrastructure and medical facilities, like in Hospital Pontian
• RM1.6 billion to build new hospitals and upgrade existing ones. The hospital includes Tengku Ampuan Rahimah Klang, Hospital Kampar, Hospital Labuan and the Queen Elizabeth II Hospital, Sabah Heart Centre.
• Govt allocates RM1 billion in investment incentives to attract Fortune 500 companies and global unicorns
• RM319m to build and upgrade health and dental clinics and quarters facilities; new clinics will be built in Setiu, Sg Petani, and Cameron Highlands, as well as Kudat and Tawau in Sabah, and Lon San and Sg Simunjan in Sarawak
• Hiring fresh graduates: Two-year pay incentives of RM500 a month. Hiring incentive of RM300 a month.

• Allocation for subsidies and social assistance increased to RM24.2 billion, including welfare aid such as Bantuan Sara Hidup (BSH). BSH scheme expanded to cover 1.1 million single individuals aged above 40 earning less than RM2,000 per month.
• Incentives to get women into the workforce:
  • Two-year pay incentive of RM500 a month
  • Hiring incentive of RM300
  • Tax exemption for women returning to work will be extended until 2023.
• RM1 billion set aside for rural roads throughout Malaysia, primarily targeted at Sabah and Sarawak
• Malaysians who replace foreign workers will get a monthly wage incentive of RM350/RM500 for two years, depending on the sector. Employers will get a monthly incentive of RM250 a month throughout the same period.

• RM587 million allocation for rural water projects, of which RM470 million will be for Sabah and Sarawak
• RM500 million for rural electrification benefiting more than 30,000 rural households, majority in Sabah and Sarawak
• Allocation for TVET programmes raised from RM5.7 billion in 2019 to RM5.9 billion in 2020
• Govt plans to double special alowance for Sabah to RM53.4m and Sarawak to RM32m; this to be doubled further to 106.8m for Sabah and RM64m for Sarawak in five years
• RM25 million allocated to Malaysia Healthcare Tourism Council to strengthen Malaysia's position as the preferred destination for medical tourism in Asean for oncology, cardiology and fertility treatments.

• RM10.9 billion allocated for rural development projects in 2020, from RM9.7 billion in 2019
• RM1.3 billion proposed for education institutions under MARA, a further RM2 billion for student loans benefitting 50,000 students
• Allocation for Agriculture and Agro-based Industry Ministry increased to RM4.9 billion, including RM150 million to support plant integration programmes such as for chilli, pineapple, coconut, watermelon and bamboo.
• RM735 million proposed for school maintenance and upgrading works

• Budget 2020 has four thrusts including boosting economic growth in new economy and digital era, investing in people.
• Approved foreign direct investment has inreased to RM80.1 billion in 2018 from RM54.1 billion in 2017.
• Govt has set up National Committee on Investments (NCI), chaired by Minister of Finance and Minister of International Trade and Industry
• Govt to offer special investment incentive package worth RM1b per year for five years to local companies capable of penetrating overseas market
• Additional RM10m allocation to be set aside for MITI to increase monitoring to ensure approved investments are realised
• Government evaluating Carey Island development feasibility for next growth phase

• Proctrated trade war offers Malaysia unique opportunity to become choice destination for FDI with high added value
• Government allocates RM210m to expedite digital infrastructure establishment in public buildings like schools
• Mandatory Standard on Access Pricing (MSAP) has successfully reduced broadband prices by 49% and increased speeds by three times
• Govt intends to develop a 100-acre logistics hub at Special Border Economic Zone at Kota Perdana in Bukit Kayu Hitam to strengthen trade relations with Thailand
• RM250m will be set aside by MCMC to prepare broadband access via satellite technology to increase connectivity in rural Malaysia, especially Sabah and Sarawak
• National Fiberisation & Connectivity Plan will adopt public-private partnership approach involving total investment of RM21.6b

• Matching grant fund of RM25m will be set aside to encourage more pioneer digital projects that benefit fibre optic infrastructure and 5G
• RM20m allocated to MDEC to groom local champions in producing digital content
• RM50 million grant to develop 5G ecosystem to prepare for 5G transformation worldwide
• 50% matching grant of up to RM5,000 to increase the digitalisation of operations for Malaysian small and medium enterprises (SME)
• Smart automation matching grant (up to RM2m) for 1,000 local manufacturers and 1,000 services companies to automate business processes

• To boost use of e-wallets, govt to offer one-time RM30 digital stimulus to qualified Malaysians aged 18 and above with annual income less than RM100,000
• 14 one-stop digital improvement centres to be set up in every state to faciltiate access to financing, development of business capacity
• RM10m to be set aside for MDEC to train micro-digital entrepreneurs and technology experts to leverage e-market places, social media platforms
• RM445m Bumiputera entrepreneur development grant for access to financing, provision of business premises, entrepreneurship training
• Digital Social Responsibility (DSR) is commitment from business sector to enhance workforce with digital skills needed by society. Contributions from the private sector to the DSR will be given tax exemptions.
• RM50m allocation proposed to encourage SMEs to engage in more export promotion activities
• Govt to provide loans worth RM100m under Small Industries Entrepreneurs Financing Scheme for Chinese community

• Islamic Economic Blueprint to be formulated to position Malaysia as centre of excellence for Islamic finance
• Govt to provide RM20m in loans under entrepreneur development scheme for Indian community
• RM20m allocation for Cradle Fund to train and offer grants to high-impact technology entrepreneurs
• Government allocates RM210m to expedite digital infrastructure establishment in public buildings like schools
• Govt to provide extra RM50m for SC's My Co-Investment Fund (MyCIF) to assist SMEs that have difficulties in getting financing
• Licensing for digital banks to be opened for public consultation by year end. A framework is expected to be released in 1H2020
• Government to up e-sports allocation to RM20m due to high potential

• RM200m set aside for 'Bantuan Musim Tengkujuh' to eligible rubber smallholders under RISDA, Lembaga Industri Getah Sabah
• Govt to allocate RM500m as guaranteed facility for women entrepreneurs via Syarikat Jaminan Pembiayaan Perniagaan Bhd (SJPP)
• Skim Jaminan Pinjaman Perniagaan will be enhanced, with the government guarantee raised to 80% of the loan amount while the guarantee fee is reduced to 0.75%. A RM500 million guarantee facility has been set aside especially for women entrepreneurs.
• RM738 million provided for Risda and Felcra to implement income generating programme

• SME Bank will introduce two new funds: a RM200m fund specially for women entrepreneurs, and a RM300m fund to support SMEs with potential to become regional champs
• RM1.1 billion allocated to Ministry of Tourism and Culture, of which RM90 million is specifically for VMY2020 promotion and programmes
• RM100 million allocated for Rubber Production Incentive in 2020 to enhance income of smallholders faced with low rubber prices
• Ministry of Entrepreneur Development to give RM10 million for advisory services and awareness for the halal industry
• R&D in public sector to be intensified with RM524 million allocation to ministries, public agencies
• Digital bank licensing framework will be finalised by Bank Negara and open for application in the first half of 2020

• Ceiling on Market Development Grant (MDG) by Malaysia External Trade Development Corporation (Matrade) raised to RM300,000. Cap on entry to export exhibitions also raised to RM25,000. RM50 million allocated to encourage SMEs to join promotional activities.
• RM855 million allocation under Federal Government Padi Fertilizer Scheme to boost padi yield
• Tax incentives for venture capital and angel investors will be extended until 2023
• Govt to contribute RM100 million towards construction of new cable car system to Penang Hill
• Govt jobs worth RM1.3b dedicated for Bumiputera contractors
• Govt proposes to raise minimum wage in urban areas to RM1,200 a month in 2020

• Govt to allocate additional RM50 million to Malaysia Co-Investment Fund (MyCIF) to benefit equity crowdfunding platforms and peer-to-peer (P2P) financing platforms.
• Govt to contribute RM100 million towards construction of new cable car system to Penang Hill
• Govt to merge Bank Pembangunan Malaysia, Danajamin Nasional, SME Bank and EXIM Bank Malaysia to restructure development financial institutions (DFI)
• Govt to launch Malaysians @ Work initiative aimed at creating better employment opportunities for youth and women, reducing over-dependence on low-skilled foreign workers
• Special Islamic Finance Committee to be set up to develop the Islamic finance ecosystem

• Govt revises Employment Act, including increasing maternity leave from 60 days to 90 days from 2021
• An allocation of RM810 mil for Federal Land Development Authority (Felda) settlers, including boosting their water supply and roadwork upgrades, and programmes to increase their earnings.
• Green Investment Tax Allowance (GITA) and Green Investment Tax Exemptions (GITE) extended to 2023 in line with sustainable development.
• Govt has launched palm oil replanting loan fund worth RM550m for smallholders
• Govt to implement B20 biodiesel for the transport sector by end-2020. This is expected to increase palm oil demand by 500,000 tonnes per annum.
• Education Ministry to receive largest allocation of RM64.1 billion in 2020 from RM60.2 billion in 2019
• Govt expects to collect RM244.5 billion in revenue in 2020, an increase of RM11.2 billion from 2019, after excluding one-off Petronas special dividend of RM30 billion

Source: The Edge

Market Daily Report: KLCI ends higher as trade talks, Budget 2020 spur optimism

KUALA LUMPUR (Oct 11): The FBM KLCI closed 4.97 points or 0.32% higher today while small market capitalisation (small cap) stocks rose by a larger quantum amid revived optimism on US-China trade talks and as investors evaluated Malaysia's Budget 2020 announcement.

At 5pm the KLCI closed at 1,556.84 after broad-based buying across Bursa Malaysia. The small-cap index rose 138.38 points or 1.05% to 13,311.92.

"Local market sentiment should recover further today on hopes for some concessions from US-China trade talks, and optimism for goodies and stimulus for selective sectors from Budget 2020 this afternoon," TA Securities Holdings Bhd wrote in a note today.

Across Bursa, 2.29 billion shares were traded for RM1.6 billion. Leading gainers included KLCI stocks MISC Bhd and Tenaga Nasional Bhd.

MISC closed 24 sen or 2.99% higher at RM8.28 while Tenaga ended up 22 sen or 1.61% at RM13.88.

Globally, Reuters reported that Southeast Asian stock markets opened higher on Friday, with Indonesia leading the gains, as revived optimism over the ongoing Sino-US trade talks boosted investor sentiment.

It was reported that market sentiment turned positive after a first day of trade talks between top US and Chinese negotiators that Trump characterised as "very, very good".

"All commentaries coming from the first day of talks seemed to be helping the markets in the region, given this is something everyone was waiting for," Joel Ng, an analyst with KGI Securities was quoted as saying.



Source: The Edge

Market Daily Report: KLCI ends higher after falling below key support level

KUALA LUMPUR (Oct 10): The FBM KLCI closed 0.64 point or 0.04% higher today at 1,551.87 after erasing losses in the final trading minutes. Share trade sentiment was seen against persistent US-China trade war uncertainties amid a broadening spat, which now includes foreign policy.

Analysts said Malaysia's Budget 2020, which will be announced tomorrow (Oct 11), also affected local market sentiment today. At 5pm today, the KLCI closed higher after falling to its intraday low at 1,548.45.

At 1,548.45, the KLCI had declined past a crucial support level.
Malacca Securities Sdn Bhd head of research Victor Wan told theedgemarkets.com today that the KLCI's "support level can be identified at 1,550."

"Conversely, key levels of resistance to look at are the 1,580 and 1,600 levels" Wan said.
Despite the KLCI's marginal gain today, he warned that investors should be aware of persistent foreign selling in the Malaysian stock market as he still sees pockets of opportunities for foreign funds to continue doing so.

This is due to uncertainties on US-China trade talks and Malaysia's Budget 2020, according to him.
Across Bursa Malaysia today, top gainers included Nestle (M) Bhd and Aeon Credit Service (M) Bhd. Top-active stocks included JAKS Resources Bhd and FGV Holdings Bhd.

Globally, Reuters reported that world stocks recouped early losses as news reports raised hopes that the US and China would settle some economic disputes, but investors were kept on edge by an earlier report that trade talks due to begin on Thursday could be cut short.

It was reported that US S&P500 mini futures traded down 0.1%, with a big part of early losses cut after the New York Times reported Washington will soon issue licences allowing some US firms to supply non-sensitive goods to China's Huawei Technologies.

"Another report, from Bloomberg, that the White House is looking at rolling out a previously agreed currency pact with China, also raised hopes of a partial deal and helped to lift risk assets.

"Earlier US stock futures slumped as much as 1.3%, as the South China Morning Post (SCMP) reported the Chinese delegation, headed by Vice Premier Liu He, was planning to leave Washington after just a day of Minister-level meetings, instead of as originally planned on Friday," Reuters reported.



Source: The Edge

Market Daily Report: KLCI finishes down 7.56 points as US-China spat escalates

KUALA LUMPUR (Oct 9): The FBM KLCI finished 7.56 points or 0.48% lower at 1,551.23 today as the broadening US-China dispute over trade and foreign policy weighed down world markets.

Reuters reported that the US State Department announced the visa restrictions just a day after the US Commerce Department cited the mistreatment of Uighur Muslims in China in its decision to add 20 Chinese public security bureaus and eight companies to a trade blacklist.

It was reported that the US' moves cast a pall over US-China trade talks in Washington, where deputy negotiators met for a second day to prepare for the first Minister-level meetings in more than two months on Thursday and Friday.

"Asian stocks fell the most in a week on Wednesday as the US and China's broadening dispute over trade and foreign policy showed little sign of coming to an end, weighing on global economic growth," Reuters said.

In Malaysia today, Malacca Securities Sdn Bhd senior analyst Kenneth Leong told theedgemarkets.com the KLCI remained downbeat after languishing in negative territory for the entire trading session, spooked by the renewed US share trade volatility at Wall Street overnight.
“Moving forward, the KLCI's losses might be cushioned by the upcoming tabling of (Malaysia's) Budget 2020 (on Friday) in anticipation of higher development expenditure," Leong said.

Across Bursa Malaysia today, turnover ended at 1.9 billion shares worth RM1.68 billion after broad-based selling across the exchange.

All indices on the bourse closed down except the palm oil, energy and transportation indices. The index for small market capitalisation stocks lost 19.47 points or 0.15% to close at 13,164.89.

Within the KLCI, Top Glove Corp Bhd was the top-percentage decliner followed by Malaysia Airports Holdings Bhd (MAHB). Top Glove closed down 10 sen or 2.24% at RM4.37 while MAHB fell 16 sen or 1.84% to RM8.53.


Source: The Edge

Market Daily Report: KLCI flat, builders rise ahead of Budget 2020

KUALA LUMPUR (Oct 8): The FBM KLCI closed down 0.21 point or 0.01% today at 1,558.79 while Bursa Malaysia's construction stocks rose ahead of the nation's Budget 2020 announcement on Friday (Oct 11).

Globally today, investors appeared to take cue from China's services sector data as they anticipated the outcome of US-China trade talks later this week. CNBC reported, citing sources, the talks would be held from Thursday to Friday (Oct 10 to 11).

At Bursa today, the construction index closed up 4.13 points or 2.04% at 206.44 at 5pm to become the largest percentage gainer among the bourse's indices.

"Despite the rally in most regional markets, the Malaysian stock market was down mainly on foreign investors adopting a waiting game ahead of the 2020 Budget announcement," Rakuten Trade Sdn Bhd deputy head of research Vincent Lau told theedgemarkets.com.

On the construction index, Lau said investors are anticipating the Budget 2020 announcement to include measures, which will boost construction job visibility.

The KLCI had earlier today risen to its intraday high of 1,565.16 before declining at about 10am. At a glance, investors appeared to have taken profit when news broke that China's Caixin/Markit services purchasing managers' index fell to 51.3 last month, the weakest since February, versus August's 52.1.
Reuters reported that services account for more than half of China's economy, providing a key buffer as persistent trade tensions with the US weigh heavily on China's manufacturing sector.

Across Asian stock markets, it was reported that Asian shares inched up on Tuesday, with Chinese shares making decent gains after a week-long holiday, though investors remained cautious over US-China trade talks after President Donald Trump said a quick deal was unlikely.

Across Bursa, 2.41 billion shares worth RM1.72 billion were traded. The most active stocks included construction companies Ekovest Bhd and Iskandar Waterfront City Bhd (IWCity).

Ekovest and IWCity settled with a volume of some 75 million and 58 million shares respectively.
Ekovest's share price closed up 6.5 sen or 8.9% at 79.5 sen while IWCity rose 7.5 sen or 8.93% to 91.5 sen.



Source: The Edge

Market Daily Report: KLCI up at 11th hour as Bursa technology stocks rise on iPhone 11 news

KUALA LUMPUR (Oct 7): The FBM KLCI settled up 1.33 points or 0.09% today at 1,559 after clawing back to positive territory at the 11th hour as global investors anticipated US-China trade talks this week and evaluated the US' latest employment data.

Today, Bursa Malaysia technology stocks rose in an apparent response to news that Apple Inc would ramp up production of iPhone 11 models.

At 5pm, the KLCI closed up after falling to its intraday low of 1,555.55.

Bursa's technology index, which includes semiconductor manufacturers, ended up 0.67 point or 1.83% at 37.25.

Across Bursa Malaysia, 2.17 billion shares worth RM1.33 billion were traded.
Top gainers included semiconductor manufacturers Malaysian Pacific Industries Bhd and Unisem (M) Bhd.

The most-active stocks included newly-listed SDS Group Bhd, which registered a volume at some 109 million shares. ACE Market-listed SDS Group's share price closed up 2.5 sen at 25.5 sen from the stock's initial public offering price of 23 sen a share.

Globally, Reuters reported that Asian shares edged higher on Monday after data showed the US unemployment rate dropped to the lowest in almost 50 years, easing concerns of a slowdown in the world's largest economy.

It was reported that sentiment towards the US economy deteriorated sharply much of last week after disappointing data on manufacturing and services suggested the trade war was taking a toll, and more rate cuts would be needed to avert a potential recession in the world's biggest economy.

"But a modest September increase in US jobs, announced on Friday, eased some of these concerns and lifted US markets that day. The US unemployment rate fell to 3.5% in September to reach the lowest since December 1969. Non-farm payrolls also grew in September, but slightly less than expected," the newswire said.

In Malaysia today, TA Securities Holdings Bhd wrote in a note earlier that the KLCI, which was deemed oversold, could be ripe for technical rebound.

"Technical trend indicators for the KLCI have turned decisively more bearish following last week's breakdown to close below key pivot low supports, pointing to more potential for significant losses ahead. Nonetheless, for this coming week, given the extreme oversold conditions triggered by last week's severe sell-down, we do not discount good possibility for a technical rebound to correct the oversold momentum.

"Additionally, the local market should also bounce back along with regional peers early this week following the US stock market's positive reaction to the closely watched September US jobs monthly report last Friday, which was robust enough to damp recession fears, but weak enough to encourage the Federal Reserve to again cut interest rates later this month," TA Securities said.

US-China trade talks will be closely watched. CNBC reported, citing sources, that the next round of the talks would be held from Thursday to Friday (Oct 10 to 11).

The outcome from this week's trade discussions "will likely be pivotal in determining if the two sides can reach an interim trade deal that postpones further tariff escalation," analysts at Eurasia Group were quoted as writing in a note.



Source: The Edge

Market Daily Report: KLCI ends 10.78 pts lower after US announces tariffs on Europe

KUALA LUMPUR (Oct 3): The FBM KLCI closed down 10.78 points or 0.68% today after Asian shares fell substantially as the US' announcement of new import tariffs on European Union (EU) imports hit world market sentiment.

At 5pm, the KLCI closed at 1,564.12, led by Public Bank Bhd and Press Metal Aluminium Holdings Bhd's share price drop.

Public Bank closed 42 sen or 2.13% lower at RM19.28 to be the top-percentage decliner among the 30 KLCI stocks. Press Metal ended down nine sen or 1.88% at RM4.69.

AxiTrader Asia Pacific market strategist Stephen Innes wrote in a note today  Malaysia's Budget 2020, which will be announced this Oct 11 "is now being viewed as the next significant catalyst which is likely keeping foreign investors cautious on local bonds, equities and currency."

Earlier today, Hong Leong Investment Bank Bhd wrote in a note that investors may adopt a defensive yield-seeking strategy amid the current market backdrop.

"Overall, we will likely see defensive yield seeking to be the dominant investment style in the near term," Hong Leong said.

Globally, Reuters reported that Asian stocks tumbled to a one-month low on Thursday as already-growing market fears about global growth were fanned by the US announcement of new import tariffs on products from the EU.

It was reported that Washington will enact 10% tariffs on Airbus planes and 25% duties on French wine, Scotch and Irish whiskies and cheese from across the continent as punishment for illegal EU aircraft subsidies.

EU manufacturers are already facing US tariffs on steel and aluminium and a threat from the US to penalise EU cars and car parts, according to Reuters.



Source: The Edge

Market Daily Report: KLCI falls 0.91% as US manufacturing data heightens slowdown fears

KUALA LUMPUR (Oct 2): The FBM KLCI fell 14.54 points or 0.91% today to close at its intraday low at 1,574.9 after the broader market reacted to weaker US manufacturing data, which underscored the impact of the US-China trade war on the US economy.

Reuters reported that global equity selling was triggered after the Institute for Supply Management’s (ISM) index of factory activity, one of the most closely-watched data on US manufacturing, dropped 1.3 points to 47.8, the lowest level since June 2009.

It was reported that a reading below 50 indicates contraction in the manufacturing sector.
"Markets had been expecting the index to rise back above 50. Global shares fell to one-month lows on Wednesday after US manufacturing activity tumbled to more than a decade low, sparking worries that the fallout from the US-China trade war is spreading to the US economy," Reuters said.

In Malaysia today, Areca Capital Sdn Bhd chief executive officer Danny Wong Teck Meng said "the slump in manufacturing activity would trigger the question of whether the (economic) slowdown is faster than expected".

Across Bursa Malaysia, a total of 1.85 billion shares were traded for RM1.44 billion.
Selling was broad-based across Bursa indices except for the REIT, utilities and technology gauges. Major decliners included the plantation and energy indices, which closed down 1.5% and 1.05% respectively.

Bursa top stock decliners included KLCI counters Public Bank Bhd and Kuala Lumpur Kepong Bhd.
The most-active stocks included Bumi Armada Bhd, which registered a volume at some 61 million shares. Bumi Armada's share price closed down one sen or 3.13% at 31 sen.




Source: The Edge

Market Daily Report: KLCI 0.35% higher; ringgit weakens as USD up at 29-month high

KUALA LUMPUR (Oct 1): The FBM KLCI closed 5.53 points or 0.35% higher today, led by Sime Darby Bhd and Sime Darby Plantation Bhd share price gains and after Asian stock markets tracked US equities' overnight rise.

The ringgit weakened against a strengthening US dollar, amid US-China trade war and Brexit concerns.

At 5pm today, the KLCI closed higher at 1,589.44. Sime Darby Bhd ended up five sen or 2.22% at RM2.30 to become the top percentage gainer among the 30 KLCI stocks, followed by Sime Darby Plantation. Sime Darby Plantation rose 10 sen or 2.11% to RM4.83.

“The market is trying to bottom up, but still remains cautious," TA Securities Holdings Bhd senior technical analyst Steven Soo told theedgemarkets.com.

Reuters reported today that globally, US stocks climbed on Monday, helped by gains in Apple, Microsoft and Merck & Co, as investors set aside worries about the U.S.-China trade war.

It was reported that Asian share prices ticked up on Tuesday, as some investors clung to hopes that the fourth quarter will bring progress in resolving the US trade war that's cast a shadow over the global economy. It was reported that Chinese markets will be shut for a week, starting Tuesday, to mark 70 years since the founding of the People's Republic of China.

In currency markets, the US dollar bulldozed almost everything in its path on its way to a 29-month high on Tuesday, as a blizzard of soft global data left the US economy, as the only one still looking in reasonable health, according to Reuters.

In Malaysia, Hong Leong Investment Bank Bhd wrote in a note today that in wake of the prevailing risk-off sentiment, appetite for US dollar assets has strengthened, amid concerns negotiations between the US and China on Oct 10-11 will not lead to a complete trade deal and possibility of a no-deal Brexit.

Hong Leong said appetite for US dollar assets also strengthened, amid excessive financial market volatility and lingering geopolitical tensions, coupled with political turmoil in the US, after the start of an impeachment inquiry into US President Donald Trump.

"Ringgit softness may persist towards RM4.23-4.28 levels (against the US dollar). Given the weak ringgit undertone, we reckon that export plays could return," Hong Leong said.
At the time of writing, the ringgit weakened to 4.1930 against the US dollar.



Source: The Edge