Sunday, March 4th, 2018


UK tells Trump that trade wars are bad and hard to win

LONDON, March 4 — Trade wars are bad and hard to win, one of Theresa May’s most senior ministers said, in a rebuke to President Donald Trump’s proposed 25 per cent tariff on steel imports and his assertion such battles are good. “I just…

Trump’s trade adviser says certain tariff ‘exemptions’ possible

WASHINGTON, March 4 — Certain exemptions could be made to the tariffs on foreign steel and aluminium announced by President Donald Trump but exclusions for entire countries aren’t expected, the top White House trade adviser said….

China to hold trade talks with US in Beijing as tensions rise

BEIJING, March 4 — China will host US officials for a new round of dialogue on trade issues, Vice Foreign Minister Zhang Yesui said at a briefing today, as tensions rise between the world’s two largest economies. Zhang, who is also spokesman…

Geely chairman not planning more automotive deals, says Bild am Sonntag

FRANKFURT, March 4 — Li Shufu, the founder and main owner of China’s Geely, has no plans to buy further stakes in carmakers after building up a holding of almost 10 per cent in Germany’s Daimler, he told a German newspaper. “Currently we…

Q4 2017 reporting season – a happy ending

PETALING JAYA: With no major surprises in the fourth quarter 2017 (Q417) reporting season, AmBank Research remains positive on the local stock market and has maintained its end-2018 target of 1,900 points for the FBM KLCI.

“We acknowledge that the risk-and-reward balance for investing in Malaysian equities has become less compelling at present versus during the start of the year following the strong run-up in the market in the recent months (that has significantly reduced the upside); and the return of volatility to the global markets, as the premise for the ‘risk-on’ trade, which is a mild and gradual rate hike cycle in developed economies, may no longer hold if inflation surprises to the upside,” the research house said in a report.

Nonetheless, as it stands now, it maintained its base case that the “risk-on” trade will still prevail in 2018, which means investors will continue to put more money to work, piling more money into equities versus bonds, against a backdrop of rising interest rates and a synchronised recovery in the global economy.

Meanwhile, emerging markets will continue to attract inflows, to both equities and bonds, backed by attractive valuation-to-growth matrix vs developed markets, coupled with firm commodity prices.

“Against a backdrop of a cyclical upturn in corporate earnings, we believe cyclical sectors will start to outperform the broader market, which are financial services, property and consumer discretionary. We also like certain large-cap names with strong earnings resilience in the construction and power space. Small and mid-cap stocks could be in the limelight thanks to the government’s mandates to GLC funds to invest more aggressively in this space,” said AmBank Research.

It said the Q417 reporting season may have started off slow, but it ended a little more upbeat. Corporate Malaysia delivered a set of Q417 results that were generally encouraging, with the majority either meeting or beating projections.

After reflecting the actual reported numbers, the research house said, FBM KLCI earnings growth for 2017 is now estimated at 5.7% versus its previous projection of 3.8%.

“On the other hand, due to the higher base in 2017, our FBM KLCI earnings growth rate for 2018F has been revised down to 7.3% (from 8.2%).”

Meanwhile, in terms of earnings growth numbers of “all sectors” – a broader but slightly more volatile earnings gauge encompassing the entire universe of its stock coverage – the growth rate for 2017 is now estimated at 2.4% (versus its previous projection of 2.2%) while the growth rate for 2018 is now projected at 11.3% (from 17.6% previously) .

BR1M: Continuous refinements, exit mechanism are key

KUALA LUMPUR: For 1Malaysia People’s Aid (BR1M) to function efficiently, continuous refinements are necessary, said Bank Negara Malaysia (BNM).

At the entry level, the cash transfers should be prioritised for the truly underserved and vulnerable groups and equally important is for BR1M beneficiaries to graduate out of the lower-income bracket over time.

“The sustainability of BR1M would depend on mobilising the lower income groups to break the vicious inter-generational poverty cycle and moving up the income ladder.

“To do so, BR1M could be enhanced by ensuring there is an exit mechanism, by linking it to promotional programmes to enhance human capital and productivity,” BNM said in a written reply to Bernama on whether BR1M was sustainable and if there should be a deadline.

In the long term, any cash assistance programmes should only form one part of a more comprehensive national social security system, it said.

“Critically, the social security system must not engender an over-reliance on state welfare or stigmatise the poor, but rather empower and build the capacity of households,” the central bank pointed out.

Broader fiscal, structural and social policies, including on the labour market and education, are key in shaping the adequate level and coverage of the social protection framework, it said.

BNM said a holistic framework for national social security system would rest on three key pillars: protection, prevention and promotion.

Frenemies: Opec finds US shale oil an intractable problem

MIDLAND, March 4 — In front of the Petroleum Club of Midland, Texas — capital of the booming Permian shale region — an electronic display flashes two crucial pieces of information: the oil price and the number of drilling rigs. For the…

China says to ‘take necessary measures’ if US harms trade

BEIJING, March 4 — China will “take necessary measures” if the United States harms the country’s economic interests, a Chinese official said today, as President Donald Trump plans to impose tariffs on steel and aluminium. “China…

Bruising Qualcomm-Broadcom battle heads for showdown

SAN FRANCISCO, March 4 — With a potential for the biggest-ever deal in the tech sector at stake, Qualcomm shareholders will have their say on a hostile bid for the US mobile chip giant by Singapore-based rival Broadcom. Qualcomm shareholders…

Trump threatens EU auto industry over bloc’s trade war retaliation

WASHINGTON, March 4 — US President Donald Trump yesterday threatened a tax on cars from the European Union if it enacts retaliatory measures in response to his announced plans for tariffs on imported steel and aluminium. “If the EU wants to…