Saturday, July 13th, 2019


Guan Eng: Malaysia expected to see sustained GDP growth in Q2 as IPI, exports grow

PUTRAJAYA, July 13 — The continued industrial production expansion in May as well as solid expansion in exports and domestic demand point towards sustained gross domestic growth (GDP) in the second quarter (Q2) of 2019, said the Finance Ministry….

Foreign appetite for bursa Malaysia, ringgit remains strong, says economist

KUALA LUMPUR, July 14 — Foreign appetite for the Malaysian market continued to remain steady for both local equities and the ringgit, says Bank Islam Malaysia chief economist Mohd Afzanizam Abdul Rashid. He said foreigners remained as net buyers…

Amazon 'Prime Day' becomes phenomenon as rivals jump in

WASHINGTON, July 13 ― It started as a simple sales promotion, but Amazon's Prime Day has now morphed into a major phenomenon joined by scores of retailers jockeying with the US colossus for a bigger slice of the e-commerce pie. Amazon's Prime Day,…

Wall Street stocks up, dollar drops on rate-cut optimism

NEW YORK, July 13 ― Wall Street stocks closed higher and the dollar fell yesterday as investors prepared for a US interest-rate cut, while oil futures were little changed as a forecast for a global crude surplus offset worries about US output…

Ringgit to trade at present level against US dollar next week

KUALA LUMPUR: The ringgit is likely to trade at the current level of between 4.11 and 4.13 against the US dollar next week, barring any major surprise that would significantly sway global risk sentiment, said a dealer.

FXTM market analyst Han Tan said the market is set to be influenced by broader sentiment surrounding Asian assets, as China will unveil its second-quarter gross domestic product figures along with other key economic indicators on Monday (July 15).

“Given existing concerns over deteriorating global economic conditions, a more pronounced slowdown in the Chinese economy could stoke risk aversion and weigh negatively on Asian currencies, including the ringgit,” he told Bernama.

He said market expectations surrounding the US Federal Reserve’s (Fed) policy decision later this month should feed into the US dollar’s near-term performance.

“Heightened expectations over a larger-than-expected US interest rate cut could further undermine the US dollar while allowing Asian and G10 currencies to post further gains,” he added.

For the week just ended, the ringgit started on a weak note as dollar sentiment improved following the release of solid US jobs data, which lowered investors’ expectations of a Fed interest rate cut. However, Fed chairman Jerome Powell subsequently said the strong jobs report did not alter his outlook on the economy and interest rates.

On July 9, Bank Negara Malaysia’s decision to maintain the benchmark policy rate at three per cent had a relatively muted impact on the local note as the market had largely expected the monetary policy decision.

The ringgit, however, rebounded on Wednesday following the latest signals that the Fed would cut interest rates later this month as well as due to the rise in global oil prices.

On a Friday-to-Friday basis, the ringgit appreciated to 4.1110/1150 from 4.1340/1370 against the US dollar.

The local currency was also traded higher against most other major currencies.

The ringgit rose against the Singapore dollar to 3.0217/0251 from 3.0460/0493 recorded in the preceding Friday and strengthened versus the Japanese yen to 3.7910/7954 from 3.8267/8306.

It also improved against the British pound to 5.1511/1586 from 5.1882/1932 and increased vis-a-vis the euro to 4.6273/6323 from 4.6557/6607. — Bernama

Bursa Malaysia set to rebound towards 1,680 level next week

KUALA LUMPUR: Bursa Malaysia is likely to stage a rebound with the key index reaching the 1,680 level next week on the possibility of US interest rate cuts this month.

Phillip Capital Management Asia-Pacific senior vice-president (investment) Datuk Dr Nazri Khan Adam Khan said following the record-breaking bullish movement of global stocks, the FTSE Bursa Malaysia KLCI (FBM KLCI) was expected to rebound towards 1,680, also driven by signals from US Federal Reserve (Fed) chairman Jerome Powell indicating a possible interest rate cut.

Wall Street’s stock indices hit record highs last Thursday as investors priced in the interest rate signals sent out by Powell, he said.

“Powell’s recent statements decreased doubts that the central bank could be changing its mind on cutting rates after last week’s unexpectedly vigorous jobs report,” he told Bernama.

Despite the robust US jobs report, Powell indicated that the Federal Reserve’s outlook on interest rates remained unchanged.

These recent events have pushed stocks significantly higher while at the same time leaving the dollar on a straight three-day decline.

The S&P 500 climbed by 0.2% to end at 2,999.91 on Thursday – it had earlier in the week reached its highest peak at 3,002 – which is a record close for the benchmark in its history of more than 60 years.

Blue chip-laden Dow Jones Industrial Average surpassed the 27,000 mark for the first time ever headed by stocks in the healthcare sector after US President Donald Trump’s administration decided to drop a plan to limit rebates on medicines.

The Dow was up by 0.9% to 27,088.08. Tech-focused Nasdaq 100 closed lower by 0.1% after also reaching new heights at 7,934.6 points. The index had closed at 7,896.78 points.

On the domestic front, Nazri noted that Malaysia had been ranked the world’s best country to invest in or do business for 2019 by CEOWORLD magazine.

“This exclusive result will boost foreign direct investment flow into our country, which directly adds up to the local economic growth,” said Nazri.

Regarding the technical analysis, he said despite the minor correction below the 38.20 per cent Fibonacci Retracement mark, he believed that the FBM KLCI’s upside development since May was still in play.

“This is given that no strong downside development was sighted yet – an indication that the bulls are still dominating market sentiment. From our technical perspective, this is viewed as merely a normal breather.

“The upside swing could still be extended once the breather ends. In addition, the formation of the “Bullish Divergence” reversal pattern gives an early signal that the trend is shifting from downside towards the upside,” said Nazri.

The immediate support, he said, remained at 1,658 points followed by the critical support at 1,600 points.

On his stock picks for next week, Nazri highlighted GD Express Carrier Bhd and Westports Holdings Bhd, which are from the transportation sector.

For risk-averse investors, he said it was best to avoid global stocks due to uncertainty risk, especially as the US and China had not reached solid peace following their trade dispute.

For the week just ended, Bursa Malaysia was traded higher in the first two days but retreated thereafter, as the local bourse succumbed to profit-taking amid an overbought market.

On a Friday-to-Friday basis, the FBM KLCI declined 13.08 points to 1,669.45 from 1,682.53 a week earlier.

The FBM Emas Index eased 61.04 points to 11,844.25, the FBMT 100 Index declined 71.91 points to 11,669.51 and the FBM Emas Syariah Index trimmed 32.43 points to 12,241.92.

The FBM Ace Index slipped 10.28 points to 4,650.13 and the FBM 70 slid 12.4 points to 14,877.57.

Sector-wise, the Financial Services Index fell 156.42 points to 16,642.19, the Plantation Index decreased 65.85 points to 6,911.28 and the Industrial Products and Services Index inched down 1.2 points to 161.32.

Weekly turnover contracted to 12.99 billion units worth RM10.26 billion from 14.56 billion units worth RM10.22 billion last week.

Main Market volume decreased to 9.36 billion shares valued at RM9.4 billion against 10.53 billion shares valued at RM9.30 billion.

Warrants turnover rose to 1.92 billion units worth RM411.56 million from 1.87 billion units worth RM380.07 million.

The ACE Market volume soared to 4.53 billion shares valued at RM2.55 billion from 2.14 billion shares valued at RM533.77 million previously. — Bernama

Fitch downgrades Turkey's debt after central bank chief sacking

WASHINGTON, July 13 ― Ratings agency Fitch yesterday downgraded Turkey's sovereign debt by one notch to “BB-“ with a negative outlook, after President Recep Tayyip Erdogan sacked the governor of the central bank. The firing of Murat Cetinkaya…

Slowing economy in Q2: What it means for jobs, General Election and long-term growth in Singapore

SINGAPORE, July 13 — The government is “not expecting a full-year recession at this point”, Deputy Prime Minister Heng Swee Keat said yesterday, but economists are warning that there is a high likelihood of a technical recession ahead. Heng,…

Slowing economy in Q2: What it means for jobs, General Election and long-term growth in Singapore

SINGAPORE, July 13 — The government is “not expecting a full-year recession at this point”, Deputy Prime Minister Heng Swee Keat said yesterday, but economists are warning that there is a high likelihood of a technical recession ahead. Heng,…

UK's FTSE 100 sees seventh straight day of losses, BoE comments lift midcaps

LONDON, July 13 ― London's FTSE 100 saw its seventh day in the red yesterday, its longest losing streak since 2015, led lower by losses in pharmaceuticals after the US White House scrapped a rebate rule, while the midcap bourse jumped on prospects…