Breakfast briefing (Wednesday, May 20, 2015)

Breakfast briefing (Wednesday, May 20, 2015)

Market wrap:
The S&P and Nasdaq ended down while the Dow rose marginally to close at a record high for a second straight day, as Wall Street digested housing data that some saw as hopeful for an economy struggling to grow. - Reuters

DJIA rose 13.31 points, or 0.07%, to end at 18,312.10. The S&P 500 lost 1.38 points, or 0.06%, to 2,128.82 and the Nasdaq dropped 8.41 points, or 0.17%, to 5,070.83.

Forex summary

The ringgit ended lower against the US dollar on lack of fresh buying amid continuing recovery of the greenback. - Bernama

* Ringgit fell 0.64% to 3.5915 per US$

* Rose 1.04% to 4.0205 per euro

*Increased 0.17% to 5.5809 to the pound sterling

* Up 0.03% to 2.6971 per Singapore dollar

* Fell 0.16% to 2.8629 per Aussie dollar

*Up 0.01% to 2.9756 per 100 yen


Oil prices fall over 3%: Oil fell more than 3%, as the dollar rallied amid evidence the US and Saudi Arabia were pumping more than the world needed. Brent dropped US$2.25 to US$64.02 a barrel. - Reuters

Top foreign stories

End-May deadline for Greece: German Chancellor and French President gave Greece until end May to reach a deal on its aid programme, urging faster talks to end the standoff over the country's financing. - Bloomberg

Fed at crossroads over liftoff plans: The Federal Reserve's plan to raise interest rates this year now faces an economy that no longer follows the script and may push the "liftoff" far into the future. The US economy slowed to crawl in the final quater and actually have contracted. -  Reuters

Singapore Q1 GDP seen higher: Singapore’s economy is forecast to have expanded more than initially estimated in the first quarter, a poll shows, after exports surged in March and industrial production held up better than expected. The detailed reading of January-March GDP will be released on May 26. — Reuters

Hyundai Motor Group eyes third India factory: South Korea’s Hyundai Motor Group is looking at building a third factory in India, highlighting its growing appetite for expanding globally after an unofficial two-year moratorium on boosting capacity. — Reuters

S. Korea doubles stock price trading band:
South Korea will double the daily price band for stocks listed on its two main exchanges to allow them to trade 30% higher or lower, a move aimed at boosting transactions and reducing the risk of markets being driven by speculative trades. — Reuters

China mulls relaxing bond sale rules: China is considering relaxing rules for bond sales in a bid to boost slowing economic growth. The National Development and Reform Commission proposals include lowering the required debt-to-asset ratio and cancelling limits on the number of note sales if proceeds are for projects approved by the government. — Bloomberg

S. Korea equities draw most of overseas funds: International money managers pumped the most funds into South Korean equities among Asian emerging markets after earnings surprises by the nation’s biggest companies. Overseas investors have bought a net US$4.7bil of the country’s equities since the end of March. —Bloomberg

Plunge in oil prices forces re-evaluation of projects, costs:
A 40% drop in oil prices over the last year has shaken up the energy sector, forcing firms to re-evaluate projects worth billions of dollars and sift through balance sheets to cut costs. Companies are also looking at forming alliances to reduce risk as they ride out the volatile oil price trough. - Reuters

ECB to moderately front-load QE buying in May, June: The European Central Bank (ECB) intends to increase its purchases of euro-area assets in May and June ahead of an expected low-liquidity period in the summer, says Executive Board member Benoit Coeure.- Reuters

Wal-Mart sales miss estimates:
Wal-Mart joins the list of US retailers reporting disappointing quarterly results, saying consumers pocketing tax refunds and savings from cheaper petrol had dented sales growth. - Reuters

Top local stories:

Construction to gain in 11th Malaysia Plan: All eyes are on the construction sector as it is expected to be a big beneficiary of the 11th Malaysia Plan (11MP) that will be tabled tomorrow.

Ringgit weakens vs dollar:
The ringgit fell the most in almost two weeks as the dollar rallied before the Federal Reserve issues the minutes of its April meeting, which may shed more light on when it will raise interest rates.

Star’s net profit jumps 63%: Efforts to rationalise operations last year are bearing fruit for Star Publications. It posts RM26.55mil earnings in the first quarter.

Subur Tiasa unaffected by MACC probe:
The Sarawak timber player is being investigated over alleged illegal logging in the state.

Landmarks unit in Indonesia hotel venture:
Landmarks' PT Bintan Hotel Utama and ML Hotel Investments will jointly develop, own and operate two international hotel chains in Treasure Bay Bintan, Indonesia.

Bank Negara credit checks ‘hurt’ housing market: Tougher credit checks on potential buyers and lending curbs imposed by Bank Negara is distorting the market, claims a top official at Malaysia’s biggest grouping of property developers. Real Estate and Housing Developers’ Association (Rehda) Malaysia reveals that due to the high rejection rates of housing loan applications, many developers have delayed their property launches, especially affordable houses.

Higher operating costs hit Axiata: The cellular firm's first-quarter net profit falls 13.3% to RM584.8mil.

Tech impact on financial market growing, says SC chief: Technology is starting to have a major impact on the financial market with digitisation and financial innovation developments taking place in the market, says Securities Commission (SC) chairman Datuk Ranjit Ajit Singh. — Bernama

AmIslamic Bank rebranded as AmBank Islamic:
AmIslamic Bank is now known as AmBank Islamic Bhd under a rebranding exercise aimed at positioning its Islamic brand more prominently in the finance industry. — Bernama

WCT to launch RM700mil mixed development projects:
WCT Holdings Bhd (WCT) is expected to launch several mixed development projects with an estimated gross development value (GDV) of RM700mil out of its remaining GDV of RM25bil this year, says deputy managing director Goh Chin Liong.

What to expect:

Statistics department to release consumer price index data

Breakfast Briefing