Market wrap: US stocks fell on Wednesday as a sharp drop in Valeant Pharmaceuticals hit the healthcare space, while the energy sector dropped along with oil prices. Valeant Pharmaceuticals' US-listed shares plunged to an intraday low of US$88.50 on record volume after a short-seller accused the company of using specialty pharmacies to inflate its revenue. - Reuters
The DJIA fell 48.5 points, or 0.28%, to 17,168.61, the S&P 500 lost 11.83 points, or 0.58%, to 2,018.94 and the Nasdaq dropped 40.86 points, or 0.84%, to 4,840.12.
Forex summary
*The ringgit lost 0.12% to 4.2915 per US$
*It rose 0.02% to 4.8673 per euro
*Down 0.06% to 6.6208 to the pound sterling
*0.03% higher to 3.0782 per Singapore dollar
*0.06% lower to 3.0965 per Aussie
*Down 0.08% to 3.5773 per 100 yen
Energy
Oil prices fell about 2% to three-week lows on Wednesday as the US government reported a bigger build than expected in crude stockpiles, although significant drawdowns in gasoline and distillates prevented a steeper slide in crude futures. Brent crude finished down 86 cents, or 1.8%, at US$47.85 a barrel, after hitting an early October low of US$47.50. - Reuters
Top foreign stories
Western Digital to buy SanDisk in US$19b deal: Hard-disk drive maker Western Digital Corp agreed to buy SanDisk Corp in a US$19 billion deal that will increase its ability to make flash memory storage chips used in smartphones and tablets. SanDisk shares hit a high of US$78.50 on Wednesday, but closed nearly US$10 below the offer price of US$86.50 in cash and stock, a fact that analysts attributed to the deal's complexity. - Reuters
ECB to stay put, keep door open for more stimulus: The European Central Bank is likely to keep the door open for more monetary stimulus but stop short of taking new policy steps at a meeting on Thursday as it awaits fresh indications about the outlook for euro zone inflation. - Reuters
Ferrari shares race ahead 15% on Wall Street debut: Ferrari shares jumped 15% to US$60 on its Wall Street debut on Wednesday after the Italian supercar maker priced its share offering at the top of the range amid heavy investor demand. Limiting the offering to a 10% stake helped parent Fiat Chrysler Automobiles to leverage the scarcity factor to squeeze out value, defying a choppy US market on which several big initial public offerings (IPOs) have been discounted or delayed this year. - Reuters
AT&T says third-quarter consensus revenue estimates 'inflated': AT&T Inc said on Wednesday that consensus revenue estimates for its third-quarter were "inflated" as they differed from its own accounting, which includes results from DirecTV, acquired by the No. 2 US wireless carrier in July. - Reuters
Boeing says 777 output may fall as losses narrow on 787: Boeing Co posted better-than-expected quarterly results and lifted its financial outlook on Wednesday, but signalled it may juggle plane production to keep profits flowing as one of its two main cash cows dries up. Boeing said it could cut production by as much as 15% on its 777 long-range, widebody jetliner, one of its most profitable planes and a key source of cash. - Reuters
Top local stories
2019 deadline to meet Basel III requirements: Financial holding companies (FHCs) have until January 2019 to fulfil the Basel III capital adequacy requirements, which could see companies like CIMB Group
Holdings Bhd, Hong Leong Financial Group Bhd and AmBank Group Bhd having to beef up their capital structures by then. The January 2019 deadline was finalised by Bank Negara last week. - StarBiz
IOI Prop’s asset buys to enhance its future profitability: The earnings potential from IOI Properties Group Bhd’s (IOI Prop) ongoing project at IOI Resort City will be more than sufficient to offset the dilutive impact from its acquisition of almost 400 acres from chairman Tan Sri Lee Shin Cheng. The issuance of new IOI Prop shares for the acquisition will see the company’s share base being enlarged by 17% to 4.4 billion shares. This translated into a dilution of 14% of earnings per share for the financial years ending June 30, 2016 and 2017, said BIMB Securities Research. - StarBiz
Barakah unit signs MoU with HK’s Hilong: Barakah Offshore Petroleum Bhd’s wholly-owned subsidiary PBJV Group Sdn Bhd has signed a memorandum of understanding (MoU) with Hilong Marine Engineering (HK) Ltd for opportunities related to offshore transportation and installation projects. - StarBiz
More reliefs expected in Budget 2016: Measures supporting the middle- and lower-income groups are expected to be addressed when Budget 2016 is proposed on Friday. Although every budget has measures and reliefs for families and individuals, there will be more focus on these measures now due to the gloomy economic outlook. - StarBiz
TMC’s quarterly net profit quadruples: TMC Life Sciences Bhd, which operates the Tropicana Medical Centre and TMC Fertility Centre, quadrupled its net profit for its latest quarter ended Aug 31, 2015, to RM2.89mil. The healthcare group, which this month changed its financial year- end to Aug 31 from May 31, told Bursa Malaysia on Thursday the figure jumped 297% year-on-year on a 29.8% higher revenue of RM30.07mil. - StarBiz
SRC rebuts allegations over RM4bil fund: RC International Sdn Bhd says the RM4bil borrowed from the Retirement Fund (Inc) (KWAP) is accounted for in its balance sheet, in accor ance with the standard accounting and governance practices. “None of it was misappropriated as claimed by those with malicious intent," it said in a statement rebutting a media report that claimed that the fund had been misappropriated. - StarBiz
Hua Yang reports 10% higher Q2 earnings: Property developer Hua Yang Bhd registered a 10.3% increase in its net profit for the second quarter to RM28.7mil. Revenue came in at RM150.6mil, up 8% from RM139.5mil last year. The company attributed the performance to steady ongoing progress in all its developments. - StarBiz
Credit Suisse to invest more in Asia-Pacific: Following the global strategic review of Credit Suisse Group, the Swiss bank will invest more capital and resources into the Asia-Pacific region. The review came about as the bulge bracket bank reported record results for its Asia-Pacific operations. - StarBiz
UEM Sunrise eyes more land Down Under: UEM Sunrise Bhd is eyeing a few more parcels of land in Melbourne and other cities in Australia to establish its presence in the property market Down Under. This includes the upcoming White Bay Power Station development site in Sydney that is expected to come into the market soon. - StarBiz
HL banks’ separation scheme to cost RM90mil: Hong Leong Bank Bhd (HLB) and Hong Leong Islamic Bank Bhd’s (HLIB) mutual separation scheme (MSS) is expected to cost the bank some RM90mil. The announcement by the banking group made it the second time it had declared a separation scheme for its staff in about four years, pointed out Maybank Investment Bank Research. - StarBiz
Pantech Q2 earnings lower on weaker sales: Pantech Group Holdings Bhd posted a net profit of RM10.4mil for the second quarter, slumping 22% from RM13.4mil last year. Revenue came in at RM121.4mil, 16.5% lower than RM141.4mil last year. The manufacturer of carbon steel elbows attributed the weaker sales performance of the group to weaker demand and delivery in local and overseas oil and gas sector. - StarBiz
Ex-United U-Li auditor found guilty: A licensed audit partner was found guilty in the Kuala Lumpur Sessions Court on Thursday of abetting United U-Li Corp Bhd in making a misleading statement in its audited results for the financial year ended Dec 31, 2004, which resulted in an inflation of about 26% in United U-Li’s reported profit before tax that year. According to a statement by the Securities Commission, Yue Chi Kin, 47, was sentenced to one year’s jail and was ordered to pay RM400,000 in default of six months’ imprisonment for the offence. - Edge FD
KNM to raise RM106.64m via placement: KNM Group Bhd has proposed a private placement to raise up to RM106.64 million, which will be used to repay borrowings, for working capital and to defray expenses related to the exercise. KNM said the placement entails an issuance of up to 193.89 million shares, representing about 10% of the issued share capital of the group. - Edge FD
New Mercedes vehicle preferred: Mercedes-Benz Malaysia Sdn Bhd, which saw its sales of new commercial vehicles rising by 15% over the past three years, is seeing an increasing preference for new vehicles compared with repossessed or second-hand ones among Malaysian buyers. - Edge FD
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