Sunday, June 10th, 2018

 

US blames Canada for G7 fiasco, says Trudeau 'stabbed us in the back'

WASHINGTON, June 10 — The US blamed Canada today for the disastrous ending to the G7 summit, saying Prime Minister Justin Trudeau “stabbed us in the back,” while American allies held Washington responsible. Just minutes after a joint…


Fund managers tap into short selling amid market volatility

PETALING JAYA: More fund managers are poised to jump onto the short-selling bandwagon amid the current volatile market environment.
An industry player who declined to be named said he observed that many fund managers have taken advantage of the heavy sell-off, and the short-selling quantum is expected to increase if the current volatility in the market continues.

“The fund managers have a wide range of portfolios on hand. They can't unload their holdings immediately, they also don't want to miss the boat, so this (short selling) is one of the ways,” he told SunBiz recently.

He noted that even big local institutions are involved in short selling of shares to make some profits. “The sentiment is quite negative given the uncertainty in the stock market. In the current situation, the people don't see a clear economic direction.”

Therefore, for some investors, the timing of the liberalisation of short selling does not seem to be “right” judging from the bumpy trading. Retail investors might be getting the short end of the stick if they were to short sell stocks for the time being.

Bursa Malaysia, which opened up regulated short selling to a wider group of investors last April, has suspended the short selling of a number of stocks since the general election on May 9, after which the equity market has lost some 3.89% on domestic factors, in particular the scrapping of mega projects, and fears over a global sell-off arising from Italy's political crisis, and US flip-flopping on trade tariffs.

The recent fluctuating equity market has been accompanied by active short selling evidenced by trading value exceeding the RM100 million mark on two days a fortnight ago, according to statistics of the stock exchange.

The short-selling trading value stood at RM168.67 million and RM127.55 million on May 28 and May 30, respectively, when the market came under strong selling pressure. Notably, the FBM KLCI sank as much as 66.33 points or 3.74% on May 30 as renewed US-China trade tensions and Italy's political crisis sparked market concerns.

Despite that, another analyst said the less sophisticated retail investors are not very keen to participate in short selling at the moment.

On the suspension limit of 15%, he said the level is considered reasonable, giving leeway before a margin call is triggered during a market downturn.

“The 15% drop limit can cushion the margin call, the investors could stand by money in the event of any huge sell-off,” he explained.

According to Bursa Malaysia, a total of 280 stocks can be short sold currently and the list is reviewed every six months.

Bursa Malaysia CEO Datuk Seri Tajuddin Atan said in April the introduction of intraday short selling to a wider group of investors is timely given the growing sophistication of market participants. It is also part of the strategy to boost market liquidity and improve flexibility for market participants.


Malaysia Rail Link: ECRL deal has no clause for Jho Low-linked companies

PETALING JAYA: Malaysia Rail Link Sdn Bhd, the project and asset owner of the East Coast Rail Link (ECRL), has denied that contracts it signed with Chinese contractor China Communications Construction Co Ltd (CCCC) and the Export-Import Bank of China came with a clause to nominate an unrelated company to buy 70% of Putrajaya Perdana Bhd for US$244 million (RM971 million) as well as 90% of Loh & Loh Corp Bhd for US$71 million (RM282.6 million).

In a statement released today, MRL called the information in an article in a business weekly headlined “Jho Low's Handiwork” baseless and an irresponsible allegation.

The article sought to establish links between Low Taek Jho (Jho Low) and the negotiations for Suria Strategic Energy Resources Sdn Bhd's RM9.4 billion pipeline projects and the ECRL among others. Putrajaya Perdana and Loh & Loh are companies linked to Jho Low.

“There is no contract between and MRL that stipulates this clause. Neither does this clause appear in the loan agreement between MRL and the Export-Import Bank of China.”

“As the project owner of the 688km ECRL, the inaccurate information presented in the said article potentially ruins the reputation of MRL and its cordial relationship with CCCC, the main contractor of the project. As such, MRL urges the media to engage with its Corporate Communications Department to verify information with regard to the ECRL project,” it said.

MRL went on to explain that the long overdue ECRL infrastructure project was done based on a government-to-government agreement. It mooted the setting up of a special purpose vehicle company to oversees its implementation.

MRL was incorporated on Sept 26, 2016, and only then was the engineering, procurement, construction and commissioning contract with CCCC and the loan agreement with Export-Import Bank of China, for the ECRL project was under its purview.

To date, the ECRL has made 14.33% overall progress of its construction, which includes setting up of base and satellite camps in all eight sections of the project, land acquisition, site clearing and construction of road access.

Multiple road access totalling some 95km in length and temporary bridges spanning 1,067m have been constructed at many of the ECRL project sites in the East Coast states.

MRL, calling the ECRL a key catalytic project, said the ECRL is progressing slightly ahead schedule and is on track for completion and operation by mid-2024. The construction works for seven tunnels in various parts of the rail alignment in Pahang and Terengganu have started.

Preparatory work for Southeast Asia's longest rail tunnel – the 16.3km Genting Tunnel is also in progress. Tunnel boring machines for the twin-bore Genting Tunnel are expected to arrive in November to facilitate tunnelling works between Bentong and Gombak.

“We trust the Federal Government will soon make an informed decision on the best course of action regarding the ECRL project. Meanwhile, we continue to provide information to the Federal Government in their review of the project,” MRL said.


Radical Swiss financial reform campaign set for defeat

ZURICH, June 10 — A radical plan to transform Switzerland’s financial landscape by barring commercial banks from creating money when they lend looked set to fail, according to initial projections on Sunday. Some 75 per cent of voters had…


DNex sees demand for portable container systems for fuel in rural areas

PETALING JAYA: Diversified business group Dagang Nexchange Bhd (DNex) sees demand for portable container systems (PCS) as a source of fuel supply in remote areas, especially among communities which rely on the pricey community drumming for fuel supplies.

The PCS, a 20-feet self-contained modular fuel storage and dispensing unit, with a capacity of holding up to 30,000 litres of fuel, is targeted to be used for the supply of petrol at the fish landing jetty in Malaysia.

DNex was awarded a contract worth between RM50 million and RM75 million by Petro Teguh Sdn Bhd to design, engineer, procure, construct, instal and commission of up to 105 units of PCS across the country, for two years.

Petro Teguh is among the three mini petrol station chains operating in the rural areas of Malaysia, following a Cabinet decision in 2008 to standardise operations of unbranded mini stations. The other two companies are IPTB Sdn Bhd which operates Buraqoil and Smart Stream Resources.

Dnex managing director Zainal Abidin Jalil said there is a “clear demand and interest” for the service which offers RON 95 petrol at retail price of RM2.20 and diesel to replace the community drumming fuel supply, which could go up to RM8.50 per litre.

The price is further subsidised to RM1.65 for fishermen.

“Remote places have been left behind and we want to decentralise economic activities to where people are working and living,” he said.

The group is looking to complete at least 50 units of PCS by year end and the remaining by 2019.

Zainal Abidin said the PCS’s are in various stages of completion and there is one up and running in Sabak Bernam, Selangor.

The contract also covers maintenance and supply of parts for 10 years, from which DNex is looking to recognise a revenue of RM2 million per annum from 2020.

Petro Teguh managing director Datuk Azmin Mustam Abdul Karim said the idea is to create a one-stop centre for the fishermen community which comprises not only a fuel station but refrigeration and drying facilities for fish and a Kedai Rakyat 1Malaysia 2.0.

A PCS will cost RM600,000 to RM750,000 as opposed to a full-fledge petrol station which would cost between RM3 million and RM5 million.

Maintenance cost for a petrol station would be about RM3,000 a month and would only require one or two operators.

Prior to the DNex deal, Petro Teguh already had 27 PCS stations under its wing, including one in Pulau Tuba, Langkawi.

Petro Teguh has also set its sights on Southern Philippines, a deal which could rake in RM28 million for some 35 PCS.


DNex sees demand for PCS in rural areas

PETALING JAYA: Diversified business group Dagang Nexchange Bhd (DNex) sees demand for portable container systems (PCS) as a source of fuel supply in remote areas, especially among communities which rely on the pricey community drumming for fuel supplies.

The PCS, a 20-feet self-contained modular fuel storage and dispensing unit, with a capacity of holding up to 30,000 litres of fuel, is targeted to be used for the supply of petrol at the fish landing jetty in Malaysia.

DNex was awarded a contract worth between RM50 million and RM75 million by Petro Teguh Sdn Bhd to design, engineer, procure, construct, instal and commission of up to 105 units of PCS across the country, for two years.

Petro Teguh is among the three mini petrol station chains operating in the rural areas of Malaysia, following a Cabinet decision in 2008 to standardise operations of unbranded mini stations. The other two companies are IPTB Sdn Bhd which operates Buraqoil and Smart Stream Resources.

Dnex managing director Zainal Abidin Jalil said there is a “clear demand and interest” for the service which offers RON 95 petrol at retail price of RM2.20 and diesel to replace the community drumming fuel supply, which could go up to RM8.50 per litre.

The price is further subsidised to RM1.65 for fishermen.

“Remote places have been left behind and we want to decentralise economic activities to where people are working and living,” he said.

The group is looking to complete at least 50 units of PCS by year end and the remaining by 2019.

Zainal Abidin said the PCS’s are in various stages of completion and there is one up and running in Sabak Bernam, Selangor.

The contract also covers maintenance and supply of parts for 10 years, from which DNex is looking to recognise a revenue of RM2 million per annum from 2020.

Petro Teguh managing director Datuk Azmin Mustam Abdul Karim said the idea is to create a one-stop centre for the fishermen community which comprises not only a fuel station but refrigeration and drying facilities for fish and a Kedai Rakyat 1Malaysia 2.0.

A PCS will cost RM600,000 to RM750,000 as opposed to a full-fledge petrol station which would cost between RM3 million and RM5 million.

Maintenance cost for a petrol station would be about RM3,000 a month and would only require one or two operators.

Prior to the DNex deal, Petro Teguh already had 27 PCS stations under its wing, including one in Pulau Tuba, Langkawi.

Petro Teguh has also set its sights on Southern Philippines, a deal which could rake in RM28 million for some 35 PCS.


New Italian economy minister vows to stay in euro, cut debt level

ROME, June 10 — Italy’s new government has no intention of leaving the euro and plans to focus on cutting debt levels, Economy Minister Giovanni Tria said today, looking to reassure nervous markets. In his first interview since taking office a…


Swiss vote on whether to introduce ‘real money’ plan

ZURICH, June 10 — Swiss voters will learn today if their country will be the first in the world to introduce a radical new financial system that would bar commercial banks creating money each time they made a loan. Polls were due to close around…


Trump torpedoes G7 effort to ease trade spat, threatens auto tariffs

LA MALBAIE (Quebec), June 10 —  US President Donald Trump today threw the G7’s efforts to show a united front into disarray after he became angry with Canadian Prime Minister Justin Trudeau, and said he might double down on import tariffs…


Singapore-North Korea trade can grow if sanctions lifted, says PM Lee

SINGAPORE, June 10 — Trade between Singapore and North Korea could grow if UN sanctions against it are lifted, the city-state’s prime minister, Lee Hsien Loong, said today, as his country prepared to host a historic US-North Korea summit. North…