HONG KONG, June 24 — Oil prices extended gains today as rising US-Iran tensions fuelled supply concerns, while Asian equities also edged up ahead of a crunch meeting between Donald Trump and Xi Jinping this week. Both main crude contracts are up…
HONG KONG, June 21 — Oil prices ticked lower today following the previous day’s surge fuelled by tensions between the United States and Iran, while Asian equities turned negative as investors took their foot off the pedal following a recent…
HONG KONG, June 21 — Oil prices rose again Friday, extending the previous day’s surge on tensions between the United States and Iran, while Asian equities turned negative as investors took their foot off the pedal following a recent rally. Fears…
TOKYO, June 21 — Asian stocks struggled today to track Wall Street’s exuberance about a possible US rate cut next month as anxiety over Sino-US trade negotiations clouded the investor mood in the region. Also tempering appetite in Asia were…
KUALA LUMPUR, June 15 ― Bursa Malaysia is likely to trade firmer with an upside bias next week, on the expected return of risk appetite backed by external and local factors. Phillip Capital Management, Asia-Pacific senior vice president…
KUALA LUMPUR: The Malaysian equity market is seeing more expensive valuations and slower earnings growth compared with its regional peers, according to HSBC Private Banking managing director and chief market strategist for Asia, Fan Cheuk Wan.
“Within our Asia equity portfolio, we’re still cautious on the Malaysian equity market mainly because of its expensive valuations versus the other cheaper regional peers. The earnings growth forecast for the Malaysian equity market still remains at single-digit, lagging behind other higher growth equity markets that we favour, such as China.
“For Malaysia, we forecast single-digit earnings growth but with the valuation premiums versus the regional’s average, it would cap the upside potential of the Malaysian equity market,” she told a press conference on the HSBC Private Banking 2019 2H Investment Outlook in Asia today.
Reflecting on Asian equities, it maintains a mild overweight position on China and Singapore. Fan said Singapore is the cheapest market in Asean and it has the lowest price-to-earnings and the highest dividend yield.
“Based on our year-end forecast, we still expect the FBM KLCI to come in at 1,740 points this year, some modest upside potential because the economy still remains resilient and there will be modest earnings growth for this year. In terms of the upside potential, there are cheaper markets that can deliver more upside,” elaborated Fan.
Nevertheless, HSBC Private Banking chief market strategist for Southeast Asia James Cheo still expects a 3-4% upside in the equity market.
“How we want to play it is to look at the domestic sectors. The consumption and infrastructure plays are where we think the opportunities are, and how it pans out could be end of this year or next year,” Cheo said.
On the ringgit, he said in the near term, there could be a risk-off where there will be more demand for the dollar given the uncertain environment.
“The domestic economy in Malaysia is still resilient so it reduces the downside for the ringgit. The ringgit could still be fairly resilient against the dollar,” said Cheo, adding that its year-end target for the ringgit is RM4.30 against the US dollar.
On Malaysia proposing a new currency based on gold, Cheo said it is an interesting idea but noted that there are trade-offs and that it should be thoroughly considered.
“It’s an international monetary system and just can’t be implemented on a single country. It requires a global consensus. Given how things are, it looks like things are more bilateral nowadays.
”We have been on a fiat currency model for many years and it has served us well. Our money supply has been growing significantly,” said Cheo.
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KUALA LUMPUR: US President Donald Trump’s vow to hike tariffs on US$200 billion of Chinese goods last week to speed up the trade talks dragged down Asian equities, including Bursa Malaysia, at Monday’s close.
At 5 pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) slipped 4.5 points to 1,632.80 from Friday’s close of 1,637.30.
After opening 5.26 points weaker at 1,632.04, the benchmark index moved between 1,623.61 and 1,633.66 throughout the session.
On the broader market, losers beat gainers 790 to 150 with 324 counters unchanged, 641 untraded and 33 others suspended.
Turnover fell to 2.79 billion shares worth RM1.70 billion from 2.82 billion shares worth RM2.11 billion on Friday.
Hong Kong’s Hang Seng fell 2.90% to 29,209.82, Japan’s Nikkei 225 slipped 0.22% to 22,258.73, the Jakarta Composite Index eased 0.99% to 6,256.65 and Singapore’s Straits Times Index was 2.98% weaker at 6,256.65.
“Trump, who calls himself “Tariff Man”, has vowed to increase tariffs on US$200 billion of goods to 25% from 10%, saying the long-standing trade dispute is progressing at a slow pace.
“As a result, China is considering cancelling the trade talks, which are supposed to take place this week,“ a dealer said.
Last year, Trump and his Chinese counterpart Xi Jinping agreed to a truce to boost the stock markets.
The world’s two largest economies have since 2018 imposed tariffs on US$360 billion in two-way trade.
“Markets will be left clueless, hence we expect cautious trading this week,“ he added.
Back home, telecommunications providers Axiata Group Bhd and DiGi.Com Bhd were under the spotlight on Monday following the proposal between Axiata Group Bhd and Norway-based Telenor ASA to create a new global champion with discussions to combine their Asian operations under a new merged global entity, MergedCo.
Telenor has a 49% stake in Digi.com.
In a filing to Bursa Malaysia, Axiata said both parties would work towards finalising an agreement within the third quarter of 2019, resulting in Telenor being the majority shareholder of MergedCo with an anticipated 56.5% stake, with Axiata holding the remaining 43.5%.
Locally, the merger of Celcom Axiata Bhd (Celcom) and Digi.Com Bhd will make the new entity the largest mobile operator in Malaysia.
This week, investors will also be focusing on the release of the first quarter of 2019 (Q1 2019) gross domestic product numbers due on May 16 and Bank Negara Malaysia’s monetary policy announcement on May 7.
Among heavyweights, Maybank rose four sen to RM9.30, Public Bank increased two sen to RM22.56, Petronas Chemicals dropped 15 sen to RM8.80 while both Axiata and Digi were flat at RM4.04 and RM4.52 respectively.
Shares of Axiata and DiGi were suspended from 9 am to 5 pm today due to the merger announcement. Trading resumes tomorrow at 9 am.
Of the actively-traded stocks, Ekovest fell 4.5 sen to 91 sen, Sapura Energy slipped 1.5 sen to 32 sen, while Lambo and Priceworth inched down half-a-sen to seven sen and nine sen, respectively.
The FBM Emas Index was 69.59 points lower at 11,542.17, the FBMT 100 decreased 55.78 points to 11,376.18 and the FBM 70 depreciated 169.08 points to 14,352.31.
The FBM Emas Syariah Index was 94.91 points weaker at 11,684.86 and the FBM Ace Index lost 134.72 points to 4,511.74.
Sector-wise, the Financial Services Index was down 49.27 points at 16,883.66, the Industrial Products and Services Index was 2.22 points easier at 167.12 while the Plantation Index edged up 0.49 point to 7,202.36.
Main Market volume fell to 1.89 billion shares valued at RM1.52 billion from 2.02 billion shares valued at RM1.96 billion last Friday.
Warrants turnover increased to 568.18 million units worth RM132.91 million versus 404.02 million units worth RM91.14 million.
Volume on the ACE Market decreased to 324.63 million shares valued at RM52.67 million against 382.70 million shares valued at RM55.54 million.
Consumer products and services accounted for 182.89 million shares traded on the Main Market, industrial products and services (423.99 million), construction (445.74 million), technology (106.51 million), SPAC (nil), financial services (32.90 million), property (177.28 million), plantation (21.79 million), REITs (12.48 million), closed/fund (nil), energy (414.88 million), healthcare (17.39 million), telecommunications and media (16.57 million), transportation and logistics (17.87 million), and utilities (21.42 million).
The physical price of gold as at 5pm stood at RM165.39 per gramme, up RM1.73 from RM163.66 at 5pm last Friday. — Bernama