business conditions

 
 

Temasek makes $3 bln bid to take control of Singapore’s Keppel Corp

SINGAPORE: Singapore state investor Temasek Holdings is offering to take control of Keppel Corp in a S$4.1 billion ($3 billion) deal that will shore up support for the conglomerate, which is battling difficult business conditions.

Temasek, which directly owns 20.5% of Keppel, said in a statement that the pre-conditional offer is subject to it obtaining domestic and foreign regulator approvals, which could take many months.

Keppel, whose businesses range from rig-building to property development, has been facing business challenges in its main sectors.

“The partial offer reflects our view that there is inherent long term value in Keppel’s businesses, notwithstanding the challenges presented by the current business and economic outlook,” Tan Chong Lee, Temasek International’s president, said in the statement.

Temasek will seek to work with Keppel’s board to undertake a strategic review of its businesses, if the deal closes.

Reuters reported the news of Temasek’s stake increase ahead of the announcement.

Temasek said it does not plan to delist or privatise Keppel, which would remain listed on Singapore Exchange.

An indirect fully owned subsidiary of Temasek will offer S$7.35 in cash for each Keppel share, a premium of nearly 26% over the last traded price of S$5.84.

Shares in Keppel were halted for trading earlier on Monday.

Morgan Stanley is the sole financier adviser to Temasek for the offer. – Reuters


US homebuilding retreats, manufacturing still struggling

WASHINGTON, Oct 18 — US homebuilding tumbled from more than a 12-year high in September, but single-family home construction rose for a fourth straight month, suggesting the housing market remains supported by lower mortgage rates even as the…


As US factories falter, White House insists economy like 'a rock'

WASHINGTON, Oct 6 — After a brief surge during his first years in office, and despite his lofty promises, the American manufacturing rebound has begun to crumble under President Donald Trump. Auto plants and steel mills are shutting down….


FMM welcomes govt’s willingness to study bringing back GST

PETALING JAYA: The Federation of Malaysian Manufacturers (FMM) has welcomed news that the government would study the merits of reintroducing the goods and services tax (GST) to replace the current sales and service tax (SST) system.

In a statement, FMM president Tan Sri Soh Thian Lai said the GST was a more transparent and effective tax regime compared to the SST.

“Given the weak external environment and amid current global tensions, we believe that priority should be given to strengthen the economy and restore more favourable business conditions. Therefore we note this will be the opportune time to reintroduce the GST system.,” he said.

He further explained that under the GST system, prices of Malaysian exports will become more competitive on the global stage, which will in turn strengthen the export industry.

Soh also outlined a number of recommendations for the revision of the GST, which included reducing the GST rate from 6% to 3% to boost business conditions, zero-rating all essential goods and services and reducing the tax compliance burden by increasing the GST registration threshold to RM1 million.

Prime Minister Tun Dr Mahathir Mohamad said the government would study the merits of the GST if the people want it back.

He was responding to comments made by the Malaysian Institute of Economic Research (MIER) chairman Tan Sri Kamal Salih that the GST should be brought back in Budget 2020 but at a lower rate of 3%.

The GST of 6% was implemented in 2015 under the previous administration, but was scrapped last year following Pakatan Harapan’s victory in GE14.

For those who had already made the switch to the SST system, Soh said moving back to the GST system would not be difficult.

“For manufacturers, switching back to previous automated model under the GST Tax Payers Access Point system will not be difficult as GST compliance systems are already in place.

“We however look forward to be engaged in the study proposed by the government in order to provide manufacturers’ views on the possible reintroduction of the GST system,” he said.


Slowing US private hiring adds to gloom over economy

WASHINGTON, Oct 3 ― Hiring by US private employers slowed further in September, suggesting that trade tensions, which have pressured manufacturing, could be spilling over to the labour market. The ADP National Employment Report yesterday also…


UK stocks retreat as weak US data adds to global growth fears

LONDON, Oct 2 ― UK stocks retreated yesterday, reversing gains from earlier in the day, coming under pressure following disappointing manufacturing data from the United States that added to concerns about the health of the global economy. The FTSE…


Malaysia’s Sep manufacturing PMI at four-month

PETALING JAYA: The headline IHS Markit Malaysia Manufacturing Purchasing Managers’ Index (PMI) rose to a four-month high of 47.9 in September, up from 47.4 in August.

This was the first time since April that the headline index has increased. At current levels, the PMI is broadly indicative of annual gross domestic product (GDP) growth of between 4.5% and 5%, according to historical comparisons.

The latest PMI data suggested that business conditions in Malaysia’s manufacturing sector remained challenging in September, although there were signs of improvement as the new orders and output indices both increased.

New product launches are anticipated to drive production volumes over the coming year and business optimism subsequently remained strong.

Employment held steady in September, while input price inflation moderated.

The survey’s output index picked up slightly in September, but held close to the levels seen across the third quarter, indicating a stable production trend.

IHS Markit said demand conditions also showed some signs of stabilisation in September. While survey data pointed to an increasingly tough environment in recent months, improved sales to existing customers reportedly contributed to a rise in the new orders index.

“Nevertheless, challenges remained apparent as clients held out for price discounts amid strong competitive pressures. External demand also remained fragile, with orders from key export markets dropping.”

Meanwhile, current and future workloads were deemed sufficient to hold employment steady during September.

The future output index was consistent with a relatively strong level of confidence, highlighting that businesses expect production volumes to be higher than present levels over the coming 12 months.

According to firms, forecasts of greater demand from domestic and external clients, as well as the planned development of new products drove the positive outlook.

However, a darkening global economic environment and geopolitical concerns contributed to a moderation in firms’ optimism compared to that seen in August.

IHS Markit said the latest survey data pointed to greater cost pressures faced by Malaysian goods producers, although the rate of input price inflation slowed and was historically weak overall. The vast majority of firms kept selling prices unchanged (97%) during September.

Commenting on the latest survey results, IHS Markit chief business economist Chris Williamson said with global headwinds intensifying, it is no surprise to see Malaysia’s manufacturers continuing to struggle in September, but there are at least some encouraging signs of upward momentum being regained.

He said the September survey comes on the heels of global PMI data showing worldwide economic growth slipping closer to three years lows mid-way through the third quarter, led by the steepest drop in global trade since 2012.

“In this environment, it’s reassuring to see that the Malaysia PMI is indicating only a very marginal easing of growth so far in the third quarter, thanks to the PMI reviving to a four-month high in September, hinting that GDP is likely to continue to expand at a respectable annual rate of 4-5% in the third quarter.

“However, while businesses generally remain upbeat about expanding production over the coming year, September saw some loss of optimism. It will therefore be important to watch global developments to ascertain whether growth momentum can be sustained as we head into the fourth quarter,” he said in a statement.


Malaysia’s Sep manufacturing PMI at four-month high

PETALING JAYA: The headline IHS Markit Malaysia Manufacturing Purchasing Managers’ Index (PMI) rose to a four-month high of 47.9 in September, up from 47.4 in August.

This was the first time since April that the headline index has increased. At current levels, the PMI is broadly indicative of annual gross domestic product (GDP) growth of between 4.5% and 5%, according to historical comparisons.

The latest PMI data suggested that business conditions in Malaysia’s manufacturing sector remained challenging in September, although there were signs of improvement as the new orders and output indices both increased.

New product launches are anticipated to drive production volumes over the coming year and business optimism subsequently remained strong.

Employment held steady in September, while input price inflation moderated.

The survey’s output index picked up slightly in September, but held close to the levels seen across the third quarter, indicating a stable production trend.

IHS Markit said demand conditions also showed some signs of stabilisation in September. While survey data pointed to an increasingly tough environment in recent months, improved sales to existing customers reportedly contributed to a rise in the new orders index.

“Nevertheless, challenges remained apparent as clients held out for price discounts amid strong competitive pressures. External demand also remained fragile, with orders from key export markets dropping.”

Meanwhile, current and future workloads were deemed sufficient to hold employment steady during September.

The future output index was consistent with a relatively strong level of confidence, highlighting that businesses expect production volumes to be higher than present levels over the coming 12 months.

According to firms, forecasts of greater demand from domestic and external clients, as well as the planned development of new products drove the positive outlook.

However, a darkening global economic environment and geopolitical concerns contributed to a moderation in firms’ optimism compared to that seen in August.

IHS Markit said the latest survey data pointed to greater cost pressures faced by Malaysian goods producers, although the rate of input price inflation slowed and was historically weak overall. The vast majority of firms kept selling prices unchanged (97%) during September.

Commenting on the latest survey results, IHS Markit chief business economist Chris Williamson said with global headwinds intensifying, it is no surprise to see Malaysia’s manufacturers continuing to struggle in September, but there are at least some encouraging signs of upward momentum being regained.

He said the September survey comes on the heels of global PMI data showing worldwide economic growth slipping closer to three years lows mid-way through the third quarter, led by the steepest drop in global trade since 2012.

“In this environment, it’s reassuring to see that the Malaysia PMI is indicating only a very marginal easing of growth so far in the third quarter, thanks to the PMI reviving to a four-month high in September, hinting that GDP is likely to continue to expand at a respectable annual rate of 4-5% in the third quarter.

“However, while businesses generally remain upbeat about expanding production over the coming year, September saw some loss of optimism. It will therefore be important to watch global developments to ascertain whether growth momentum can be sustained as we head into the fourth quarter,” he said in a statement.


World share index up 0.1 per cent, heading for first weekly loss in four

LONDON, Sept 20 — World shares rose today as stimulus measures by major central banks eased worries about growth, especially in Asian markets, while oil headed for its best week since January. China cut a key lending rate for the second straight…


US services sector growth accelerates; private payrolls jump

WASHINGTON, Sept 5 — US services sector activity accelerated in August and private employers boosted hiring, suggesting the economy continued to grow at a moderate pace despite trade tensions which have stoked financial market fears of a…