Monday, April 16th, 2018

 

Saudi shares hit 32-month high as confidence rises

RIYADH, April 16 — The Saudi stock market surged today to a 32-month high as analysts said higher oil prices and easing anxieties after US-led strikes on Syria helped fuel confidence. The Tadawul All-Shares Index (TASI) added one per cent to…


Trump says Russia, China playing ‘currency devaluation game’

WASHINGTON, April 16 — US President Donald Trump accused Russia and China today of devaluing their currencies while the United States raises interest rates. “Russia and China are playing the Currency Devaluation game as the US keeps raising…


US stocks rise on retail sales, relief over Syria

NEW YORK, April 16 — Wall Street stocks rose early today on better-than-expected US retail sales and relief that conflict over Syria has not escalated. Retail spending in the US gained 0.6 per cent in March, rising to US$494.6 billion,…


Foreign buying on Bursa last week tops RM300m

PETALING JAYA: The net amount acquired by foreign investors last week amounted to RM324.7 million, only the eighth time this year weekly foreign buying levels exceeded RM300 million.

“International investors continued to make their way to accumulate stocks listed on Bursa last week albeit at a rather similar pace compared to the week before,” MIDF Research said in its fund flow report today.

Foreign buying activity occurred on four out of five trading days last week. Global investors made a strong start to the week as they mopped up RM188.3 million net of local equities on Monday. This was also the largest daily amount acquired during the week, coinciding with the KLCI adding 12.7 points as US President Donald Trump’s tweet expressed optimism on US-China relations, which softened fears of a trade war. Foreign inflows slightly slowed down the next day to a tune of RM131 million net.

Wednesday then saw a decent net outflow of RM27.4 million amid escalated tensions over Syria, which overshadowed the news of volume across Bursa exceeding 4 billion shares amid the timing of the 14th General Election which was made public on the day before.

Nonetheless, foreign investors returned to Bursa on Thursday and Friday but at a marginal level of RM17.5 million and RM15.3 million net, respectively.

“It was noteworthy that Malaysia and Korea were the only markets among the seven Asian exchanges that we track, to experience foreign inflows on Thursday and Friday.”

On a year-to-date basis, foreigners have so far accumulated RM2.85 billion net of local equities.

Meanwhile, foreign investors have been net buyers in 12 out of the 15 weeks in 2018 compared to 13 weeks during the same period in 2017.

Both foreign and retail participation remained robust as both of their average daily trade value stood above the RM1 billion level last week.


Ekuinas forays into electronic manufacturing services with purchase of Flexi Versa

KUALA LUMPUR: Ekuiti Nasional Bhd (Ekuinas) today announced its foray into the electronic manufacturing services (EMS) industry after it acquired a controlling stake in a local and leading Southeast Asian turnkey and components manufacturer Flexi Versa Group Sdn Bhd (FVG) for RM330 million.

FVG’s business commenced in 1994 whilst the investment holding vehicle was incorporated in 2013 to drive the management’s vision towards creating an EMS group. Today, FVG operates seven factories in Malaysia and two outside of Malaysia, and is a Tier 1 and Tier 2 contract manufacturer to leading global consumer electronic brands such as Sony, Panasonic, Onkyo, Sony, Dyson and JVC Kenwood.

“FVG’s solid fundamentals and market potential were key factors in our decision process. Its financial track record and operational capabilities, specifically in its ability to integrate different entities and formulate its strategy, underpin its strong position with revenue of RM300 million and will serve as a basis for growth locally and within the region,” Ekuinas CEO Syed Yasir Arafat Syed Abd Kadir said in a statement.

FVG’s proposition was further strengthened by the company’s good range of manufacturing capabilities, regional footprint and available capacity to support the growth trajectory. The company’s presence in four Asean countries, specifically Singapore, Indonesia, Vietnam and Malaysia, provides the advantage to capitalise on the positions of these countries as manufacturing hubs for the automotive and consumer electrical and electronics products.

“In addition to that, FVG’s senior management’s overall operations and turnaround experiences were central to our evaluation. Their experience in turning loss-making businesses to profitability is strongly demonstrated via their track record. Without doubt, a capable senior management team is important. Their vision is equally significant especially in charting and navigating the future growth and strategy of the company,” Syed Yasir Arafat added.

This is Ekuinas’ second investment in the manufacturing sector following the acquisition of a homegrown lighting design and consultancy firm Davex (Malaysia) Sdn Bhd in December 2017.


Ekuinas ups stake in manufacturing

KUALA LUMPUR: Ekuiti Nasional Bhd (Ekuinas) today announced its foray into the electronic manufacturing services (EMS) industry after it acquired a controlling stake in a local and leading Southeast Asian turnkey and components manufacturer Flexi Versa Group Sdn Bhd (FVG) for RM330 million.

FVG’s business commenced in 1994 whilst the investment holding vehicle was incorporated in 2013 to drive the management’s vision towards creating an EMS group. Today, FVG operates seven factories in Malaysia and two outside of Malaysia, and is a Tier 1 and Tier 2 contract manufacturer to leading global consumer electronic brands such as Sony, Panasonic, Onkyo, Sony, Dyson and JVC Kenwood.

“FVG’s solid fundamentals and market potential were key factors in our decision process. Its financial track record and operational capabilities, specifically in its ability to integrate different entities and formulate its strategy, underpin its strong position with revenue of RM300 million and will serve as a basis for growth locally and within the region,” Ekuinas CEO Syed Yasir Arafat Syed Abd Kadir said in a statement.

FVG’s proposition was further strengthened by the company’s good range of manufacturing capabilities, regional footprint and available capacity to support the growth trajectory. The company’s presence in four Asean countries, specifically Singapore, Indonesia, Vietnam and Malaysia, provides the advantage to capitalise on the positions of these countries as manufacturing hubs for the automotive and consumer electrical and electronics products.

“In addition to that, FVG’s senior management’s overall operations and turnaround experiences were central to our evaluation. Their experience in turning loss-making businesses to profitability is strongly demonstrated via their track record. Without doubt, a capable senior management team is important. Their vision is equally significant especially in charting and navigating the future growth and strategy of the company,” Syed Yasir Arafat added.

This is Ekuinas’ second investment in the manufacturing sector following the acquisition of a homegrown lighting design and consultancy firm Davex (Malaysia) Sdn Bhd in December 2017.


BDB signs up 9 anchor retailers for Axis Commercial Hub

ALOR STAR: BDB Land Sdn Bhd, a wholly owned subsidiary of Bina Darulaman Bhd (BDB), inked a memorandum of understanding (MoU) with nine anchor retailers for its Axis Commercial Hub development located in the township development of Bandar Darulaman, Jitra today.

BDB chairman Datuk Paduka Rasli Basir said The Axis Commercial Hub will provide the Kedah market with a niché food & beverage and education hub.

“Our partners also recognise the growth potential of the Northern Corridor and are aiming to breathe a vibrancy into the marketplace. We want the hub to be synonymous with good food and a retail mix that will be ideal for community engagement amidst an exciting ambience.”

The MoUs were signed with retail leasing consultant CBD Retail Sdn Bhd, and operators/proprietors of nine business brands: Petron Petrol Station; Coffee Books & Rain Café; Kopi & Roti; Wash Studio Laundry; Raja’s Grocery; The Little Caliphs; Genius Aulad; Big Galley’s Café and WellBeing Pharmacy. A lease agreement was signed with EM Opulence Sdn Bhd for the operation of the petrol station at the hub.

The Axis Neighbourhood Retail Centre within the Axis Commercial Hub development is touted to be Kedah’s first education-centric development, which offers just over 41,000 sq ft of rentable space. Consisting of 15 units of double-storey shoplots, the education centres set up within the hub will provide early learning and specialised education facilities aimed at the young and growing population around Jitra and Alor Star.

The Axis Neighborhood Retail Centre will be built at a cost of RM5 million and aims to be a food destination featuring Kedah’s household food and beverage providers, alongside essential neighborhood retail services such as a laundry, pharmacy and medical clinic.

The Axis Commercial Hub will commence construction in April and targeted for completion by the end of 2019. The petrol station is targeted to commence operations in Q4 2019, while the businesses in the shoplots are to open to public as early as Q1 2020.


Trump’s renewed interest in TPP – a diversion tactic?

PETALING JAYA: Economists say US President Donald Trump’s sudden interest in rejoining the rejuvenated Trans-Pacific Partnership (TPP) could be a move to divert attention from ongoing tensions with China and Russia and also an effort to rally the troops in its battle against China in trade.

Last week, Trump (pix) broadcast his interest in joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership CPTPP, after denouncing the original TPP agreement as disadvantageous to the US during the campaign trail and eventually pulling out of it in the first week of being named president.

OCBC Group vice-president and senior investment strategist Vasu Menon said, it is hard to discount the possibility of Trump using the pact as a smokescreen to divert attention from the tension with China, sanctions against Russia, FBI investigations into Russia’s involvement in the last election and the military strike against Syria.

Echoing his sentiments, Sunway University Business School Professor of Economics Dr Yeah Kim Leng said the US could also be weighing in the possibility of using a multilateral approach rather than taking China on, on its own.

“In a way it may be he is heeding some of the advice, that it is better to use the multilateral approach to negotiate and build up position against China rather than going in alone in terms of confronting China over some of the trade issues,” said Yeah.

Vasu opined that while the withdrawal from the TPP had put the agricultural segment at a competitive disadvantage, the further pile-up of Chinese retaliatory tariffs brought things to a tipping point, forcing Trump to backtrack and now try to convince farmers that he will be able to negotiate a better deal than the already advantageous TPP deal for them and in turn appease electorates for the upcoming mid-term elections.

Yeah said that the initiative to reconsider is, however, a positive sign and an about-turn from his anti-trade and overly nationalistic policies, signaling that the bark is more than the bite when it comes to Trump’s damaging trade policies.

On renegotiating terms of the pact, RHB Banking Group chief economist and head of research Dr Arup Raha is of the view that the CPTPP trade bloc will stand its ground and welcome the US but not with a renegotiation of terms.

“There is likely to be resistance and unwillingness among many of the 11 member states in the CPTPP because of distrust with Trump and also because they know that reworking a new deal with Trump will be an arduous task given his erratic and temperamental nature and his America First policy which suggests an unwillingness to compromise,” Vasu said in agreement.

He added that Trump’s statement on having bilateral ties with six of the 11 nations and working on a deal with Japan, the biggest of the 11 countries, raises a question on his seriousness about the deal as this goes on to suggest that his preference is with bilateral ties, over multilateral as that will pave way for the US to assert itself and negotiate better terms in line with Trump’s “America First” policy.

“They (CPTPP) will still need to deliberate whether they will accept the re-entry of the US without deviating back to the original agreement or they need to insist the US join under the new terms where quite a number of the onerous provisions has been removed under the CPTPP,” said Yeah.

Arup and Vasu concurred that it will take a long time for an outcome to materialise, with Vasu saying that nothing may come out of it, as he finds it hard to see CPTPP members agreeting to significant new concessions to Trump.


Bursa Malaysia opens up short selling to ‘wider’ group of investors

PETALING JAYA: Bursa Malaysia Bhd has opened up regulated short selling to a wider group of investors, it said, by implementing “a clear” framework to facilitate intraday short selling as part of its strategy to boost market liquidity.

With that, investors will be able to sell securities prior to acquiring them, within the trading day itself.

Regulated short selling of shares has been made available for quite some time, but participation has been largely restricted for retail investors.

In fact, restricted short selling and securities borrowing and lending were first introduced in 1996 but suspended barely a year later, following a meltdown in the stock market during the 1997 Asian financial crisis. The trading instrument was reintroduced in January 2007.

According to Bursa Malaysia, intraday short selling can be carried out on a selected list of eligible securities or approved securities. It comprises 280 securities and will be reviewed every six months.

“Introducing intraday short selling to a wider group of investors is timely considering the growing sophistication of market participants. This measure is part of the exchange’s strategy to boost market liquidity and further improves flexibility for market participants to refine their trading and risk management strategies,” said Bursa Malaysia CEO Datuk Seri Tajuddin Atan.

Bursa Malaysia statistics show that between six million and 14 million shares were short sold last week under the regulated short-selling framework.

A robust compliance requirement and safeguards have been put in place, with suspensions to intraday short selling to be triggered if a stock price falls by more than 15% from the previous day’s closing price or if the gross short-selling volume exceeds the daily maximum limit of 3% of outstanding shares per security.

The framework also specifies compliance obligation requirements for investors before short-selling activities can commence.


Rafidah resigns as Supermax chairman after MD’s apology to PM

PETALING JAYA: Tan Sri Rafidah Aziz has resigned as Supermax Corp Bhd chairman after managing director Datuk Seri Stanley Thai, who is currently appealing against his five-year sentence for insider trading, issued an apology to the Prime Minister for his involvement in politics last Saturday.

Rafidah, 74, who was appointed non-independent, non-executive chairman of Supermax in June 2015, cited “personal reasons” for her departure.

In a statement to Bursa Malaysia Securities today, Supermax said the resignation of Rafidah does not affect the day-to-day business operations or the performance of the group.

Thai said at a press conference last Saturday that he was influenced by propaganda and the Opposition during the 13th general election (GE13) and regretted getting involved in politics as a businessman, stressing that he was no longer involved in any political activities.

Recall that in 2013, Thai was quoted in a Bloomberg report saying that he would join Malaysian Chinese in abandoning support for Prime Minister Datuk Seri Najib Razak and vote for the Opposition in GE13.

Late last year, Thai was sentenced by the Kuala Lumpur Sessions Court to a five-year jail term and fined RM5 million for insider trading offences committed when he was CEO of now-delisted APL Industries Bhd.

Thai was convicted for communicating non-public information between Oct 26, 2007 and Oct 29, 2007 to former remisier Tiong Kiong Choon. Tiong was convicted of two counts of disposing of a total of 6.2 million APLI shares while in possession of the same non-public information via accounts belonging to his mother-in-law and his mother.

It was the first insider trading conviction where both the tipper (the person who communicated the inside information), Thai, and the tippee, Tiong, were charged and convicted for the offence.

On Bursa Malaysia today, Supermax soared 8 sen or 3.1% to RM2.68 on volume of 5.44 million shares.