Monday, May 13th, 2019


China says to impose tariffs on US$60b worth of US goods

BEIJING, May 13 — China said today it will impose tariffs on US$60 billion worth of US goods from June 1, in apparent retaliation after Washington announced plans to tax almost all Chinese imports. Beijing will hit a number of American imports…

Trump warns China not to retaliate against US trade tariffs

WASHINGTON, May 13 — President Donald Trump today warned China not to retaliate after Washington raised punitive duties on US$200 billion worth of Chinese imports to 25 per cent from 10 per cent. “China should not retaliate-will only get…

Malaysia keeps top spot for global sukuk issuance in Q1

KUALA LUMPUR: Global sukuk issuance reached US$39.5 billion (RM164 billion) at end-March, with Malaysia maintaining its leadership, accounting for 35.1% or US$13.9 billion of the issued amount.

Indonesia and Saudi Arabia came next, with respective shares of 17% or US$6.7 billion and 15.3% or US$6.1 billion, according to RAM Ratings.

In a statement today, the rating agency said a total of US$12.8 billion of sukuk was issued globally in March.

RAM head of Islamic finance Ruslena Ramli pointed out that a 38% year-on-year jump in global sukuk issuance bodes well for the pace of this segment’s performance in 2019.

“Key markets to watch are Indonesia, as the nation gears up for sovereign sukuk issuances in line with its sustainability agenda, and Saudi Arabia, whose persistent budget deficits may lead to a higher percentage of sukuk in its government funding mix,” she said.

RAM Ratings expects Malaysia to remain at the forefront as an issuer, providing stability to the overall base of global sukuk issues.

Malaysia recorded a 54.4% spike in sukuk issuance as at end-March 2019, compared with US$9 billion a year earlier, driven by the introduction of Bank Negara Malaysia’s Interbank Islamic Bills (BNIB-i) issuances.

RAM Ratings said it expects the BNIB-i issuances to grow further in 2019, due to its recognition as a high quality liquid asset.

“On the domestic front, outstanding sukuk rose 10.5% to RM880.3 billion as at end-March, and maintained its position as a leader in the Malaysian bond market, accounting for 60.9%.

“Notably, its share has been trending upwards since hitting 50% in 2013,” it said.

A total of RM22.3 billion of domestic sukuk was issued in March, bringing the year-to-date issuance value to RM64.1 billion at month-end.

The rating agency said the financial services, as well as the infrastructure and utilities sectors were the chief drivers of the domestic sukuk market, with respective issuance values of RM11.4 billion and RM3.6 billion in the first quarter.

Greatech hopes to raise RM73m from IPO

KUALA LUMPUR: Greatech Technology Bhd, an industrial automation solutions provider, aims to raise RM73.05 million from its initial public offering (IPO), said CEO Tan Eng Kee.

Of the total proceeds, RM18 million would be utilised for business expansion and development and marketing activities, RM5 million for capital and research and development expenditure and RM36.55 million for working capital, he said.

Meanwhile, the remaining RM8.5 million would be used for repayment of bank borrowings and defrayment of IPO expenses, he said.

“We try to expand our footprint in the US market, so we are going to establish an office, engineering sales and services support in the country and small portion in China.

“We are looking at the east coast, Arizona and some in the area of Silicon Valley… we hope to start operations in the second half of this year,“ he told press conference after launching the company’s prospectus today.

Greatech Technology will be listed on the ACE Market of Bursa Malaysia Securities Bhd, offering 119.75 million shares, where 18.78 million of the shares are eligible for the public, with an IPO price of 61 sen per share.

The group is slated for listing on June 13, with a market capitalisation of RM381.86 million.

Asked on why the US market is selected, Tan said the country is always ahead in terms of technology innovation and believed its unemployment rate is much better than other regions.

“Majority of the expansion allocation will be set aside for US market,“ he said.

For the financial year ended Dec 31, 2018, the group recorded a revenue of RM219.58 million and tax after profit of RM31.72 million with approximately 90% of the revenue derived from overseas.

Its 2017 revenue amounted to RM93.91 million, higher than RM22.7 million it chalked in 2016 and RM21.39 million in 2015.

Tan said the group targeted between 10% and 15% growth in revenue this year, backed by a slew of new projects coming up from the new and existing clients.

Also present to witness the launch of the prospectus was Malaysian Technology Development Corporation (MTDC) CEO Datuk Norhalim Yunus who believed Greatech Technology’s excellent growth trajectory would easily push the IPO for premium performance during the listing.

“The group is in the right industry, namely in automation and robotics, besides solar, which currently expanding rapidly.

“I believe they have a bright future with a formidable list of clients,” he said.

The group received fundings from MTDC for Commercialisation of Research and Development Fund, Technology Acquisition Fund and Business Growth Fund.

Foreign funds step up selling of stocks on Bursa

PETALING JAYA: Foreign funds sold RM450.9 million net of local equities on Bursa Malaysia last week, the largest weekly foreign net outflow in nine weeks.

“Offshore investors upped their ante in net selling activity last week, extending the selling streak on Bursa to the seventh week,“ MIDF Research said in its fund flow report today.

It said a measurable pace of foreign net selling was observed on Monday at a tune of RM12.6 million before international funds made a return on Tuesday after acquiring RM149.8 million net.

“We opine that the influx of foreign funds into Bursa on Tuesday was mainly attributable to the overnight policy rate cut from 3.25% to 3% by Bank Negara Malaysia to stimulate investment and domestic spending activities. The local bourse followed suit to close 0.4% higher 1,639 points on the Tuesday, the only day during the week which had a gain.”

Foreign investors were back in selling mode on Wednesday, selling off RM75.1 million net as concerns of the US-China trade tensions linger.

The level of foreign net selling swelled to RM382.5 million net on Thursday, the highest in a day so far this year. Worries escalated ahead of Friday’s deadline when the US will increase tariffs on US$200 billion (RM831.3 billion) worth of Chinese goods from 10% to 25%. The huge foreign net outflow was in conformity with other regional peers namely Thailand, Indonesia, the Philippines and Taiwan.

International funds still sold local equities on Friday but at a lower pace of RM130.5 million net with the first day trade talks between the US and China making no significant progress.

On a month-to-date basis, Malaysia has recorded a foreign net outflow of RM527.4 million in May 2019. This brings the year-to-date foreign net outflow from Malaysia to RM3.28 billion.

Participation amongst foreign investors experienced a slowdown last week. Foreign investors recorded a 4.7% weekly decline in average daily traded value last week but still remained at healthy levels of above RM1.00 billion at RM1.18 billion.

Test flights begin at Beijing’s new mega-airport

BEIJING, May 13 — Chinese airlines conducted test flights today at a new mega-airport in Beijing that is set to become one of the world’s busiest after it opens later this year. The tests at Daxing International Airport — which will have eight…

Ringgit closes weaker in line with regional currencies

KUALA LUMPUR: The ringgit closed lower against the US dollar today in line with the weaker regional emerging market currencies as sentiment was dampened by the stalemate in the US-China trade talks, dealers said.

At 6pm, the ringgit was lower at 4.1620/1670 against the greenback compared with 4.1570/1600 at Friday’s close.

A dealer said trade talks between the world’s two top economies came to a deadlock after Washington demanded promises of concrete changes to Chinese law, while Beijing said it would not swallow any ‘bitter fruit’ that harmed its interests.

He said this came after the US increased the tariff rate to 25% from 10% on US$200 billion worth of Chinese imports last week after US President Donald Trump said Beijing “broke the deal” by reneging from earlier comments.

“While optimism over the outlook of the Chinese economy had improved recently, uncertainties on the trade front could prompt policymakers to take further measures to shore up policy easing,” he said.

The ringgit was also traded mostly lower against other major currencies.

The local note traded firmer against the Singapore dollar at 3.0435/0483 from Friday’s 3.0503/0534 but depreciated against the Japanese yen to 3.7943/7996 from 3.7843/7880.

The local currency weakened vis-a-vis the British pound to 5.4189/4263 from 5.4091/4147 and decreased against the euro to 4.6768/6837 from 4.6683/6733 yesterday. — Bernama

Metro shares slip after British bank moves to reassure customers

LONDON, May 13 — Metro Bank shares fell today after weekend social media postings led to customer queues at some London branches, prompting the British bank to reassure depositors and investors. “We’re aware there were increased queries in…

Bursa Malaysia ends weaker on broad selloff

KUALA LUMPUR, May 13 — Bursa Malaysia suffered a broad decline today amid worries over the weak first-quarter earnings season and liquidity as well as the escalation in the US-China trade war. At 5pm, the FTSE Bursa Malaysia KLCI (FBM KLCI)…

Malaysian bonds total trade rises to RM26.9b

KUALA LUMPUR, May 13 — Total trading for government bonds, such as Malaysian Government Securities (MGS) and Mudharabah Investment Interbank (MII) for the week ended May 10, rose to RM26.9 billion from RM19.4 billion in the preceding week. In its…