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Wednesday, February 26, 2020
FBMKLCI: 1,500.88
THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY*
Daily Brief
Market View, News in Brief: Corporate, Economy, and Share Buybacks
Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my www.taonline.com.my
M a r k e t V i e w Recovery on Hopes for Political Resolution
The local market rebounded from the previous day’s selloff after the King’s appointment of
Tun Mahathir as an interim PM following his shock resignation helped ease domestic political
tensions. The FBM KLCI rose 10.82 points to close at 1,500.82, off an opening low of 1,481.46
and high of 1,503.30, as gainers led losers 531 to 380 on total trade of 3.12bn shares worth
RM2.76bn.
Resistance at 1,517/1,529; Key Supports at 1,474/1,448
While stocks may recover further on hopes for eventual resolution to the present political
crisis, lingering uncertainties and worries over a potential global virus pandemic should keep
gains in check. Immediate index resistance capping upside could be from 1,517, the previous
3 Feb pivot low, followed by the falling 10-day ma at 1,529, and next at 1,550, the 30-day ma.
Key chart supports to watch are at 1,474, the March 2011 low, followed by 1,448, the 76.4%FR
of the 1,310 low to 1,896 high.
Bargain IOI Corp & Sime Darby
Any sharp selloffs on IOI Corp shares toward the Dec 2018 pivot low of RM4.10 should
attract bargain hunters ahead of rebound upside to the 38.2%FR (RM4.38), 50%FR (RM4.46)
or 61.8%FR (RM4.54) ahead. Meantime, Sime Darby shares are attractive to accumulate at
current depressed levels ahead of recovery to the 23.6%FR (RM2.25), with the 38.2%FR
(RM2.40) and 50%FR (RM2.52) as tougher upside hurdles.
Asian Markets Trade Mixed on Virus Jitters
Asian markets were mixed on Tuesday amid fears the coronavirus outbreak could escalate
into a pandemic and derail global economic growth. The spread of the coronavirus outbreak
to regions from Italy to Iran sparked concerns about a pandemic, with the number of cases
worldwide topping 80,000. China’s death toll rose to 2,663, an increase of 71. Total
coronavirus cases on the mainland climbed to 77,658 as Hubei province reported 499
additional infections. While the head of the World Health Organization called the new cases
“deeply concerning,” he said the outbreak isn’t yet a pandemic. The WHO also said that
Gilead Sciences Inc.’s experimental drug that is being tested for coronavirus may be the only
one that will work. Returning from a Monday holiday, the Nikkei 225 closed 3.34% lower at
22,605.41 as shares of index heavyweight Fast Retailing dropped 4.15%. Shares in Australia
also declined as the S&P/ASX 200 fell 1.6% to close at 6,866.60. Shares in mainland China
were mixed on the day, with the Shanghai composite shedding 0.6% to 3,013.05 while the
Shenzhen component added 0.71% to 11,856.08. Elsewhere, South Korea’s Kospi closed
1.18% higher at 2,103.61, following sharp losses on the previous day.
Page 1 of 1126-Feb-20
Wall Street Extend Losses as CDC Warns Virus Spread
Wall Street’s sell-off deepens on Tuesday as fears of a global pandemic pushed the U.S. stock
market to its worst decline since 2008. The Dow Jones Industrial Average plunged 879.44
points, or 3.15%, to 27,081.36, the S&P 500 slid 97.68 points, or 3.03%, to 3,128.21 and the
Nasdaq Composite lost 255.67 points, or 2.77%, to 8,965.61. Stocks initially moved to the
upside as some traders went bargain hunting, picking up stocks at reduced levels on the heels
of yesterday's steep drop. However, buying interest waned shortly after the start of trading,
as fears about the outbreak escalating into a pandemic continued to hang over the markets.
Officials for the Centers for Disease Control and Prevention (CDC) warned Americans that
the outbreak “might be bad,” and that Americans should prepare for the possibility of
disruptions, even though the current threat to the U.S. remains low.
The number of worldwide cases of COVID-19 continues to rise. There are now 80,238 cases
in 34 countries and at least 2,700 deaths, according to the World Health Organization
(WHO). Meanwhile, the U.S. Department of Health & Human Services called for USD2.5
billion of additional federal funds to help combat the coronavirus, including to stockpile
surgical masks and to work on a potential vaccine. Adding to the worries, MasterCard and
United Airlines joined a growing list of companies that have warned about the potential
financial impact of the outbreak.
[ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K]
Page 2 of 1126-Feb-20
N e w s I n B r i e f Corporate
Petronas Dagangan Bhd’s (PetDag) net profit jumped 171% to RM126.6mn in its fourth
quarter ended Dec 31, 2019 (4QFY19), from RM46.7mnn in the year-ago quarter. For the
full financial year ended Dec 31, 2019 (FY19), PetDag’s net profit totaled RM829.5mn, lower
by 2.4% compared with RM849.9mn in the preceding year. Annual revenue held steady at
RM30.3bn compared with RM30.1bn in FY18. (The Edge)
Nestle (Malaysia) Bhd’s net profit for the fourth quarter ended Dec 31, 2019 rose 6.5%
to RM131.8mn from RM123.8mn a year ago on the back of robust domestic sales. Its
revenue, however, fell 1.4% to RM1.33bn compared with RM1.35bn previously, impacted by
subdued export demand against the backdrop of regional and global uncertainties. For the
full-year period, its net profit grew 2.1% to RM672.9mn against RM658.9mn last year, while
revenue was flat at RM5.52bn. (The Sun)
IJM Corp Bhd’s net profit for the third quarter ended Dec 31, 2019 fell 46.7% to RM49.8mn
from RM93.4mn a year ago due to higher share of losses of associates. The group posted
revenue of RM1.44bn, a decrease of 4.4% over RM1.51bn achieved previously. For the nine-
month period, IJM’s net profit rose by 0.7% to RM179.3mn from RM178.1mn last year, with
revenue up 7% to RM4.56bn from RM4.26bn. (The Sun)
Sunway Bhd posted a 10.5% higher net profit of RM200.3mn for the fourth quarter ended
Dec 31, 2019 (4QFY19) from RM181.2mn a year ago, on higher contributions from its
property development, quarry and property investment segments. The higher net profit was
despite a 6.8% decline in revenue to RM1.35bn during the quarter, from RM1.45bn, due to
lower contributions from its other divisions. Meanwhile, net profit in FY19 rose 18.8% to
RM766.6mn from RM645.5mn a year ago, mainly due to higher profit contributions from
most business segments except construction and trading and manufacturing. (The Edge)
Inari Amertron Bhd’s net profit slumped nearly 32.0% to RM37.5mn in the second
quarter ended Dec 31, 2019 (2QFY20) from RM55.1mn year ago, on change in product mix,
higher depreciation costs and a less favourable foreign exchange rate. Revenue fell 11.6% to
RM265.0mn, from RM 376.0mn in the previous corresponding quarter, due to reduced sales
volumes in optoelectronic products. For the cumulative six-month period (1HFY20), net
profit fell 26.0% to RM85.2mn from RM115.2mn a year ago on lower revenue of RM582.0mn,
which dropped 7.0% from RM625.9mn a year ago. (The Edge)
Supermax Corp Bhd’s net profit in the second quarter ended Dec 31, 2019 (2QFY20)
declined 20.9% on-year to RM30.2mn from RM38.1mn, dragged by lower average selling
prices and higher production costs. The latest-quarter results dragged Supermax’s net profit
in the six-month period ended Dec 31, 2019 (6MFY20) down by 25.9% to RM54.9mn, from
RM74.1mn in the year-ago period. For 6MFY20, cumulative revenue grew 0.4% on-year to
RM755.4mn, from RM752.2mn. (The Edge)
MSM Malaysia Holdings Bhd (Not Rated) saw its net loss for the fourth quarter ended
Dec 31, 2019 widen to RM40.3mn, from RM10.3mn in the previous corresponding quarter
due to the continuous depletion of its average selling prices (ASP) and decline in export
volumes throughout the year. Revenue for the quarter declined 2.8% to RM516.0mn from
RM530.9mn a year ago. For the full year, the group swung to the red with a net loss of
RM299.8mn, from a net profit of RM35.7mn in FY18. Revenue also dropped to RM2.0bn
from RM2.2bn. (The Sun)
Page 3 of 1126-Feb-20
Syarikat Takaful Malaysia Keluarga Bhd's (Takaful Malaysia) (Not Rated) net
profit for the financial year ended Dec 31, 2019 rose to RM364.8mn from RM294.9mn in the
2018 financial year. Revenue also grew to RM3.12bn from RM2.63bn previously, attributed
to higher sales generated by the family takaful business. (Bernama)
Dutch Lady Milk Industries Bhd (Not Rated) reported a 12% year-on-year fall in its
fourth quarter net profit to RM26.7mn from RM30.3mn, which it blamed on its pricing
strategy, higher raw material prices and a negative exchange rate impact. The effects of these
could not be completely offset by the 3.9% rise in revenue to RM281.8mn in the three
months ended Dec 31, 2019 (4QFY19), from RM271.2mn previously, which was driven by
higher domestic milk consumption. For the full FY19, Dutch Lady’s net profit sank 20.5% y-
o-y to RM103.0mn from RM129.5mn, despite posting marginally higher annual revenue of
RM1.07bn versus RM1.05bn previously. (The Edge)
MMC Corporation Bhd's (Not Rated) net profit rose to RM255.2mn in the financial
year ended Dec 31, 2019 (FY19) from RM220.1mn recorded a year ago. Revenue, however,
declined to RM4.72bn from RM4.98bn previously due to lower work progress from
the Klang Valley Mass Rapid Transit Sungai Buloh-Serdang-Putrajaya Line (KVMRT-SSP Line)
following revision of contract in November 2018 and the Langat Sewerage project. As for
the fourth quarter of FY19, net profit decreased to RM68.1mn from RM119.7mn previously,
while revenue fell to RM1.1bn from RM1.6bn recorded in the fourth quarter of 2018.
(Bernama)
Pos Malaysia Bhd (Not Rated) posted its largest quarterly net loss. This led to its net
loss ballooning to RM171.1mn for the three months ended Dec 31, 2019, over 13 times the
RM13.0mn it posted in the corresponding quarter a year ago. Revenue came in 4% lower at
RM559.6mn, from RM581.2mn. This caused its net loss for the cumulative nine months ended
Dec 31 to widen to RM215.6mn from RM24.6mn in the corresponding nine months a year
ago, while revenue retreated to RM1.68bn from RM1.76bn. (The Edge)
Hibiscus Petroleum Bhd’s (Not Rated) net profit grew 2.28% to RM51.3mn for the
second quarter ended Dec 31, 2019 (2QFY20), from RM50.1mn a year earlier. Revenue rose
64.6% to RM271.9mn, from RM165.2mn in 2QFY19. For the first half of FY20, Hibiscus’ net
profit dropped 55.1% to RM67.5mn, from RM150.1mn, while revenue was down 17.89% to
RM431.15mn, from RM525.11mn. (The Edge)
Mega First Corp Bhd’s (Not Rated) fourth quarter net profit more than doubled to
RM84.2mn, from RM31.2mn a year earlier, thanks to a higher profit from the construction
segment and maiden income from energy sales. Quarterly revenue fell 11.5% to RM195.5mn,
from RM220.9mn a year ago, no thanks to lower construction revenue which more than
offset the maiden energy sale in the quarter. For FY19 as a whole, Mega First’s net profit
rose 18.9% to RM153.7mn from RM129.3mn in FY18, due to lower tax incurred and higher
power segment contribution, which more than offset a lower profit from the construction
segment and investment holdings. (The Edge)
Econpile Holdings Bhd (Not Rated) returned to the black with a net profit of RM8.7mn
in the second quarter of the financial year ended Dec 31, 2019 (2QFY19) against a net loss
of RM34.5mn in the same period in the preceding financial year. Revenue decreased to
RM137.7mn, from RM148.2mn previously. The civil engineering company recorded revenue
of RM273.1mn for the current six months financial period ended Dec 31, 2019 (6MFY19),
mainly from the piling and foundation services business segment. (The Edge)
Page 4 of 1126-Feb-20
Ekovest Bhd (Not Rated) saw its net profit fall 33.9% to RM29.0mn for the second
financial quarter ended Dec 31, 2019 (2QFY20) from RM43.9mn a year ago, due to
completion of certain construction works which have a better profit margin. Nevertheless,
the group managed to post a 5.2% increase in net profit for the first half ended Dec 31, 2019
(1HFY20) to RM92.4mn from RM87.8mn a year ago, while revenue grew 9.8% to
RM731.12mn in 1HFY20, from RM666.1mn in 1HFY19. (The Edge)
An impairment suffered by Southern Steel Bhd (Not Rated) in its second quarter ended
Dec 31, 2019 (2QFY20) resulted in the group posting its biggest ever quarterly loss of
RM335.0mn. This compares with a net loss of RM44.4mn in the year-ago quarter, and also
marks the group’s fifth consecutive quarterly loss. Meanwhile, quarterly revenue contracted
27.2% to RM589.4mn, from RM809.5mn in 2QFY18. For the first half of FY20, Southern Steel
registered a net loss of RM380.5mn on lower revenue of RM1.24bn. This compares with a
net loss of RM42.6mn it had recorded in the corresponding period last year, on a revenue
of RM1.74bn. (The Edge)
Kronologi (Not Rated) recorded a 14% year-on-year rise in net profit at RM18.6mn in its
financial year ended Dec 31, 2019 (FY19) from RM16.3mn previously, as revenue jumped
44% to a record high of RM235.5mn from RM163.0mn. The stronger FY19 profit came
despite a 35% y-o-y drop in the group’s fourth quarter net profit to RM3.0mn from RM4.7mn,
mainly due to lower margin, higher interest expenses and depreciation due to geographical
expansion. This was despite revenue growing 65.3% to RM69.3mn from RM41.9mn. (The
Edge)
Sedania Innovator Bhd (Not Rated) has returned to the black with a net profit of
RM153k in the fourth quarter ended Dec 31, 2019 (Q4 2019), compared with a net loss of
RM3.2mn in the same period a year ago. Revenue jumped to RM6.1mn in Q4 2019 from
RM2.1mn in Q4 2018. For the financial year ended Dec 31, 2019 (FY19), Sedania Innovator
also turned profitable with a net profit of RM2.5mn compared with a net loss of RM4.4mn
in FY18, while revenue improved to RM15.5mn from RM12.3mn previously. (The Edge)
Boustead Plantations Bhd (Not Rated) slipped deeper into the red in the financial year
ended Dec 31, 2019, weighed down by RM176.0mn in impairment losses at its Tawai estates
in Sabah and Lepan Kabu Estate in KelantanThe group said net loss expanded to RM144.0mn
from RM51.8mn in FY18. Revenue also dipped to RM577.2mn, from RM584.0mn. (The Edge)
Lower contribution from the property development segment dragged down IOI
Properties Group Bhd’s (Not Rated) net profit by 7% in the second financial quarter
ended Dec 31, 2019 (2QFY20). It reported a net profit of RM199.8mn in 2QFY20, against
RM214.9mn a year ago. The group, nevertheless, reported a 3% increase in net profit for the
cumulative six months (1HFY20) to RM336.4mn from RM326.8mn a year ago, on lower
taxation incurred. Revenue for 1HFY20, however, fell 9% to RM1.1bn from RM1.21bn in
1HFY19, on lower contributions from its property development segment. (The Edge)
Prestariang Bhd (Not Rated) is selling its boutique university which is owned and
operated by its unit, Prestariang Education Sdn Bhd, to Serba Dinamik Group Bhd
(SDGB) for RM2.5mn. The disposal is part of Prestariang’s rationalisation plans to improve
cash flow and working capital, while resetting the business to return to profitability. In a joint
statement here, the companies said a conditional share sale agreement was sealed for
SDGB to acquire University Malaysia of Computer Science and Engineering (UNIMY) owned
by Prestariang Education. (Bernama)
Page 5 of 1126-Feb-20
Minda Global Bhd (Not Rated) said it is disposing of an education campus in Hulu Langat
for RM30.0mn cash. Minda Globa’s indirect wholly-owned unit Asiamet Education Group
Sdn Bhd has signed a sales and purchase agreement with Ascent Resource Holdings Sdn Bhd
for the disposal. The sale will result in gains on disposal of RM6.5mn, taking into account
disposal expenses of about RM2.3mn and the properties’ net book value of RM21.2mn as at
end-2018. (The Edge)
Optimax Holdings Bhd (New IPO) is heading for a listing on the ACE Market of Bursa
Malaysia Securities Bhd, with its initial public offering (IPO) entailing a public issue of 70.0mn
new shares. Optimax is a provider of eye specialist services with a network of 13 specialist
centres in Malaysia including one specialist hospital, 10 ambulatory care centres and two
specialist clinics. (The Sun)
[ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K]
Page 6 of 1126-Feb-20
N e w s I n B r i e f Economy
Malaysi a Malaysia 2020 GDP to Slow to 4.2%, Says Moody’s
Malaysia’s 2020 real gross domestic product growth should slow to 4.2% from a 10-year low
of 4.3% in 2019, with downside risks from ongoing global trade tensions and the coronavirus
outbreak, according to Moody’s Investors Service. In a note, Moody’s Sovereign Risk Group
assistant vice president said departures from Malaysia’s ruling Pakatan Harapan coalition and
the resignation of Prime Minister Tun Dr Mahathir Mohamad usher in a period of uncertainty
for the country, because it is unclear as to how or when a new government will be formed.
Fang said such uncertainty weighs on private investment and, if prolonged, will compound
growth challenges and add downside risks to the country’s credit profile, particularly if the
new government changes the policy emphasis away from fiscal consolidation and institutional
reforms. (The Edge)
S&P Global Ratings Warns Downward Pressure on Malaysia's Credit Rating
S&P Global Ratings warns of downward pressure on Malaysia's sovereign credit ratings if
new political developments suggest a weakened commitment to fiscal consolidation. The
independent credit rating agency currently has a 'A-/A-2' foreign currency rating on Malaysia
and a 'A/A-1' for local currency rating, both with a stable outlook. In a statement today, S&P
Global Ratings said the country's economic growth outlook is important for its ratings where
an extended period of uncertainty could undermine growth. “We believe the scale of these
risks will be proportionate to the duration of uncertainty regarding the formation of Malaysia's next
government,” it added. Although the abrupt resignation of Tun Dr Mahathir Mohamad as
prime minister and the subsequent collapse of the Pakatan Harapan government augurs fresh
uncertainty in the political landscape, S&P Global Ratings believes there is no material impact
on Malaysia's key credit factors at this point.
“In the near term, heightened political uncertainty is likely to give rise to higher volatility in Malaysia's
financial markets, and potentially spur some capital outflows. However, we do not yet believe there
is a strong likelihood for major changes to medium-term factors such as fiscal and economic policies.”
Still, S&P Global Ratings noted that the government's collapse coincides with an already
difficult period for the Malaysian and regional economies amid the coronavirus (Covid-19)
outbreak. “There is a risk that this development could delay implementation of measures aimed at
mitigating the economic impact. The government's ability to maintain its policy focus during this
challenging time will be important. A swift transition to a new government would likely mitigate these
associated risks," it said, adding that political uncertainty will undermine policymaking and
affect investor confidence,” it said. (The Edge)
Malaysia Postpones Stimulus Package Amid Political Uncertainty
Interim prime minister Tun Dr Mahathir Mohamad will still present the highly anticipated
economic stimulus package, but at a later date to be confirmed, says former finance minister
Lim Guan Eng. In a statement, Lim said he had met up with Mahathir earlier this morning to
discuss the development in national politics. The discussion also touched on the economic
stimulus package to address the impact of the coronavirus (Covid-19) outbreak, which
Mahathir was scheduled to present on Thursday. “The Ministry of Finance and I had finalised
the economic stimulus package Feb 23 (on my last full day as minister of finance) to be presented
to Dr Mahathir for his approval on Feb 24. However, Tun had submitted his resignation on Feb 24,”
Lim said. “Dr Mahathir indicated that the economic stimulus package will go ahead on a date to
be announced by him in his capacity as the Interim prime minister,” Lim added. It is unclear
whether Mahathir has approved the finalised package. (The Edge)
Page 7 of 1126-Feb-20
Malaysian Financial Markets Continue to Function Efficiently
The country’s financial markets continue to function efficiently with ample liquidity despite
the recent political developments, said Bank Negara Malaysia’s Financial Markets Committee
(FMC). FMC said foreign exchange (forex) transaction volume remained healthy at
US$14.6BN supported by two-way flows while the US dollar/ringgit one-month implied
volatility remains within normal range of around 4.0% to 4.5%. It said US dollar/ringgit opened
higher and traded in an orderly manner throughout Tuesday, in line with broad market
expectation and consistent with the performance of regional currencies amid the global
outbreak of Covid-19. The increased interest led to the US dollar/ringgit interbank forex
volume to double from last week’s average. In the ringgit fixed income market, yield
adjustments for the benchmark Malaysian Government Securities have been orderly, with
the five-year and 10-year yield levels recovering from their initial upward movements.
The Financial Market Association of Malaysia (FMAM) president Chu Kok Wei said the
orderly manner in which the ringgit forex and bond markets were functioning reflects the
maturity of the Malaysian financial markets. “There is sufficient liquidity to fulfil all stakeholders’
needs, as reflected in higher transaction volumes concluded,” Chu said in the statement. “FMAM
and its member institutions are committed to ensuring the effectiveness and efficiency of market
operations,” Chu added. FMC said it would continue to monitor developments in the financial
markets to ensure that all business and transaction needs are met. (NST)
Asia China to Introduce Strong Financial Measures to Help Smaller Firms Overcome
Difficulties
China will roll out a set of strong financial policies, including encouraging financial institutions
to provisionally defer loan payments and increasing lending at concessional rates for micro-,
small- and medium-sized enterprises, as part of effort to help them overcome temporary
difficulties. These decisions were made on Tuesday (Feb 25) at the State Council's executive
meeting chaired by Premier Li Keqiang. "Statistics show that only a small percentage of micro-,
small- and medium-sized businesses have restarted operation. As these firms are major job providers,
we must give them greater support to facilitate their early restart of work and tide them over the
tough time. Such support can be further intensified for businesses in Hubei Province," Li said.
The meeting decided on additional financial measures in line with market principles and the
law to support micro-, small- and medium-sized companies in restarting operation. For
eligible micro-, small- and medium-sized firms, including household businesses, with
temporary liquidity difficulty, financial institutions will be encouraged to provisionally defer
their loan principal repayments. Their interest payments can be deferred to June 30, with
penalty interest payments exempted.
It was decided at the meeting that the re-lending and re-discount quota will be increased by
CNY500bn (US$71.2bn), with the bulk channelled to small and medium-sized banks to
increase their credit support to micro-, small- and medium-sized businesses. The re-lending
rate targeting rural areas, agriculture, farmers and smaller businesses will be lowered by 25
basis points to 2.5%. (The Star)
Page 8 of 1126-Feb-20
Japan Leading Index Increases in December
Japan's leading index rose in December as initially estimated, final data from the Cabinet
Office showed. The leading index, which measures the future economic activity, rose to 91.6
in December from 90.8 in November. This was in line with initial estimate. The coincident
index that reflects the current economic activity fell to 94.1 in December from 94.7 in the
previous month. According to the initial estimate, the index remained unchanged. The lagging
index rose to 105.0 in December from 104.4 in the prior month. The initial estimate was
106.9.
Separately, producer prices in Japan were up 2.3% on year in January, the Bank of Japan said.
That exceeded expectations for a gain of 2.1%, which would have been unchanged from the
previous three months. On a monthly basis, producer prices sank 0.3% following the flat
reading in December. Individually, prices were up for transportation, communications, real
estate, finance and advertising. Producer prices for all items excluding international
transportation gained 2.3% on year and fell 0.2% on month. (RTT)
Indonesia Unveils US$742mn Stimulus to Counter Virus Impact
Indonesia unveiled a raft of fiscal incentives for its tourism, airline and housing sectors hit by
the outbreak of the deadly coronavirus, broadening efforts to bolster growth in Southeast
Asia’s largest economy. The government will waive taxes on hotels and restaurants in the
nation’s top 10 tourist destinations for a three-month period starting March 1, Coordinating
Minister for Economy Airlangga Hartarto told reporters in Jakarta after a cabinet meeting.
State-run oil behemoth PT Pertamina will sell jet fuel at concessional rates to airlines to
enable them offer a 30% discount on a quarter of their seats to these destinations, Finance
Minister Sri Mulyani Indrawati said.
The fiscal incentives will be equivalent to IDR10.3tln (US$742mn), including about IDR3.3tln
to be given as grants to local governments hit by the slump in tourist arrivals, Indrawati said.
The stimulus for the tourism and related sectors may help draw more visitors and net the
government IDR13tln in foreign exchange earnings, Tourism and Creative Economy Minister
Wishnutama Kusubandio said. The incentives will complement the central bank’s interest
rate cut last week to support economic growth, Indrawati said, adding the banking regulator
will also take steps to reduce cost of borrowing. The government will extend IDR1.5tln as
interest rate and down-payment rebate for home buyers from the low-income groups, she
said. (Bloomberg)
United States Home Prices Increase 3.8% in December, a Big Jump from November
The housing market heated up at the end of 2019, and that was reflected in growing gains in
home values. In December, home prices rose 3.8% annually on the S&P CoreLogic Case-
Shiller National Home Price Index. That is up from the 3.5% gain in November. The 10-City
Composite increased 2.4% annually, up from 2% in the previous month. The 20-City
Composite rose 2.9%, up from 2.5% in the previous month. Leading the list of cities with the
largest gains were Phoenix, Charlotte and Tampa. Home prices in Phoenix were up 6.5%
year-over-year, followed by Charlotte with a 5.3% increase and Tampa, where prices were
5.2% higher. Twelve of the 20 cities saw bigger price increases in the year ending December
2019 compared with November’s annual read. Every city in the 20-city composite saw a gain
in home values. Chicago and New York saw the smallest annual gains at just 1% for each. At
the national level, home prices are 59% above the trough reached in February 2012, and 15%
above their pre-financial crisis peak. Results for 2019 were broad-based, with gains in every
city in our 20-City Composite. (CNBC)
Page 9 of 1126-Feb-20
Eurozone and United UK Retailers Plan To Raise Investment: CBI
Kingdom British retailers plan to raise their investment in the year ahead for the first time in two
years, the latest quarterly Distributive Trends Survey from the Confederation of British
Industry showed Tuesday. The balance for investment intentions rose to +26 percent from
-38 percent in November, which was the biggest swing since the survey began in 1983. At
the same time, the business optimism balance was unchanged at 4 percent. A net 1 percent
of retailers reported a rise in sales volume in the year to January and a balance of -3 percent
forecasts fall in sales in the year to March. Sales were seen as poor for the time of year in
February as the balance came in at -14 percent. The prospects for a recovery in investment
in the retail sector are on the up, Ben Jones, CBI principal economist, said. This is particularly
the case among large retailers, driven by shifts online and the trend for re-purposing retail
space. "Overall, underlying momentum in the UK economy remains subdued at the start of 2020,
but we continue to expect a mild improvement over the course of the year," Jones added. (RTT)
German Economy Stalls as Estimated in Q4
The German economy stagnated in the fourth quarter, in line with the initial estimate, as the
positive contribution to growth from investment was nullified by foreign trade, detailed data
from Destatis revealed. Gross domestic product remained flat sequentially after expanding
0.2% in the previous quarter. The statistical office confirmed the flash estimate released on
February 14. Consequently, price-adjusted GDP grew 0.6% in 2019. On a non-adjusted basis,
GDP rose 0.3% year-on-year after a 1.1% expansion in the third quarter. On a working-day
basis, the economy grew 0.4% year-on-year following a 0.6% increase in the previous quarter.
The annual rates also matched the preliminary estimate.
There were mixed signals regarding domestic demand at the end of the year. Household
consumption remained unchanged and general government expenditure rose only 0.3% from
the previous quarter. While gross fixed capital formation in construction climbed 0.6% largely
due to the mild weather, capital formation in machinery and equipment decreased notably
by 2.0%. At the same time, capital formation in other fixed assets was up 1.1%. Further,
foreign trade slowed down the economic activity. Exports were down 0.2%, while imports
rose 1.3%. Changes in inventories contributed 0.6 percentage points to the growth in the
fourth quarter. (RTT)
Page 10 of 1126-Feb-20
N e w s I n B r i e f Share Buy-Back
Share Buy-Back: 25 February 2020
Total Treasury
Company Bought Back Price (RM) Hi/Lo (RM)
Shares
CHINWEL 20,200 1.36/1.35 1.38/1.35 7,431,300
CRESBLD 65,200 0.895/0.89 0.90/0.89 14,144,100
FIAMMA 100,000 0.50 0.50 18,477,900
FIHB 10,000 0.275/0.27 0.285/0.265 1,222,387
GKENT 20,000 0.88 0.88/0.855 29,819,800
GLOMAC 25,000 0.345/0.34 0.35/0.34 22,704,400
KERJAYA 150,000 1.23/1.22 1.23/1.21 10,608,200
SALCON 820,000 0.20/0.195 0.20/0.19 29,920,047
SYF 900,000 0.17 0.165/0.16 34,491,800
TROP 55,000 0.88 0.88/0.875 22,440,841
YTLPOWR 1,000 0.70 0.695/0.68 482,908,712
Source: Bursa Malaysia
[ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K]
Disclaimer
The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ or completeness is not guaranteed and opinions are subject to change without
notice. This report is for information only and not to be construed as a solicitation for contracts. We accept no liability for any direct or indirect loss arising from the use of this document.
We, our associates, directors, employees may have an interest in the securities and/or companies mentioned herein.
Kaladher Govindan – Head of Research
TA SECURITIES HOLDINGS BERHAD (14948-M)
A Participating Organisation of Bursa Malaysia Securities Berhad
Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048
www.ta.com.my
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