Breakfast briefing: Monday, November 2

MarketWatch: Though the US stock market has broadly recovered from its August swoon, the same can't be said of transport stocks. Continuing weakness in railroad and trucking companies have pushed the Dow Jones Transport Average index away from the S&P 500, a divergence that often is seen as a broad sell sign.  Not this time around, according to analysts. They say the transports, down 11% in 2015 compared with the S&P 500's 1.5% gain, might be oversold on sector-specific issues rather than from a market-wide problem. - Reuters

Top foreign stories

Sprint aims to slash costs up to US$2.5b: Wireless carrier Sprint Corp S.N. said on Sunday it aims to slash fiscal 2016 expenses by as much as US$2.5 billion, through layoffs and a wide array of cost controls, as an essential part of its ongoing turnaround efforts. - Reuters

US jobs data hold key to Fed's rate plans: US jobs data due this week may hold the key to whether the Federal Reserve will raise interest rates for the first time since 2006 in December, signalling its intention to end an era of almost-free dollars. - Reuters

China's October factory, services surveys show economy still wobbly: Activity in China's manufacturing sector unexpectedly contracted in October for a third straight month, an official survey showed on Sunday, fuelling fears the economy may still be losing momentum in the fourth quarter despite a raft of stimulus measures. Adding to those concerns, China's services sector, which has been one of the few bright spots in the economy, also showed signs of cooling last month, expanding at its slowest pace in nearly seven years. - Reuters

ECB reveals capital hole in Greek banks:
Greece's banks need to raise more than 14 billion euros (10 billion pounds) of extra capital to cover mounting unpaid loans, the European Central Bank said as it announced the results of stress tests intended to rehabilitate Greek lenders. - Reuters

Three buyout funds vying for GE's US$7b French banking arm: Private equity groups CVC Capital Partners, Cerberus Capital Management and JC Flowers have placed rival bids for GE Money Bank in France, which has around 6 billion euros (US$6.6 billion) worth of assets, with mortgages representing a large proportion, sources said. - Reuters

Top local stories

Bears to dominate? The recent rebound in the Malaysian stock market is seen over as the issues that keep popping up this year – speculation over a US interest rate hike, weak commodity
prices and weak ringgit – continue to weigh on market sentiments. - StarBiz

Mixed views on MGS move:
The Government’s plan to list and trade Malaysian government securities (MGS) and government investment issues to spur retail participation and boost the vibrancy of the debt market has drawn mixed reactions. - StarBiz

Perodua expands into pre-owned vehicle retail segment: Perusahaan Otomobil Kedua Sdn Bhd (Perodua) is expanding into the retail sales segment for pre-owned vehicles and improving its after-sales service to cushion itself from the weaker ringgit and challenging outlook in the automotive sector. - StarBiz

Inix diversifies into dredging and land reclamation: INIX Technologies Holdings Bhd is optimistic over outlook, given its diversification initiative into the promising dredging and land reclamation services industry. Executive director Chow Hung Keey said Inix has also proposed a two-for-one rights issue and detachable warrants to raise total proceed of RM27.8mil to fund the new ventures and expansion. - Bernama

Nestle ramping up Maggi production: Nestle (Malaysia) Bhd is running a high capacity Maggi noodles line at its Batu Tiga factory to cater to Malaysian consumers. According to a report, Malaysians con- sume 3.6 million packets of instant noodles a day, of which 1.4 million packets are that of the Maggi brand. - StarBiz

Contrasting fortunes for Maxis and DiGi: While Maxis Bhd has reported a positive set of third-quarter financial results, Bhd showed the opposite, reflecting the challenges of a competitive industry.. Another telco, Celcom Axiata Bhd has yet to announce its quarterly financial performance. - StarBiz

Derivatives gaining momentum: Risky as they may be it is undeniable that derivatives have enabled many investors to hedge their positions and protect their portfolios in an increasingly volatile and uncertain market environment. And for Bursa Malaysia Bhd, derivatives have been the saving grace for its income growth amid the decline in trading activity in the domestic equity market. - StarBiz

RAM sees deficit target as realistic: Malaysia will be able to meet its reduced deficit target of 3.1% that was anounced in the Budget 2016 in spite of a low oil price envi- ronment, according to RAM Ratings Bhd. - StarBiz

Ewein set to bag second Penang project by year-end: Ewein Bhd, which is currently jointly devel- oping the RM800 million City of Dreams condominium project in Bandar Tanjong Pinang, Penang with Consortium Zenith BUCG Sdn Bhd, is set to bag its second project on the island by the end of the year. - Edge FD

Poultry firms unfazed by haze: The Federation of Livestock Farmers' Associations Of Malaysia, the umbrella organisation of the Malaysian livestock industry, says the overall production of broiler chickens and eggs remains satisfactory. - Edge FD

SHH Resources not for sale: SHH Resources Holdings Bhd, which has been touted as a potential acquisition target for bigger rival Heveaboard Bhd, has made it clear that it is not for sale. Its executive deputy chairman Ling Hee Keat said any tie-ups with HeveaBoard will merely be collaborative in nature and will not involve a disposal or exchange of shares. - Edge FD

Sanichi remains upbeat on property venture: Sanichi Technology Bhd, whose original business is in precision plastic injection moulding, is unperturbed by the current property slowdown. Its managing director Datuk Seri Dr Jacky Pang Chow Huat said Sanichi is expecting an annual profit of up to RM13 million from its project in Klebang, Malacca, for the next three years. - Edge FD

Vale Malaysia sees higher revenue with new hub: Vale Malaysia Minerals Sdn Bhd — a unit of Brazilian mining giant Vale SA, the world’s largest iron ore producer — has seen revenue contribution from Asian markets rise from 49.2% in the first quarter ended March 31, 2015 to 53.6%, thanks to the opening of its Teluk Rubiah Maritime Terminal iron ore distribution hub in Lumut, Perak. - Edge FD

Key Asic readies for its first bite of IoT pie: Little-known semiconductor design company Key Asic Bhd is readying itself to grab a bite of the estimated US$1.7 trillion (RM7.24 trillion) Internet of Things  industry. - Edge FD

Local companies should not fear TPP, say experts: Although there are concerns that the Trans-Pacific Partnership (TPP) agreement will be disadvantageous to Malaysia, industry experts say the trade deal will actually achieve the reverse and give Malaysian companies a level playing field as everyone has to play by the same rules. - Edge FD

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