Breakfast briefing: Tuesday, February 23


EPF Chief Executive Officer Datuk Shahril Ridza Ridzuan

Market wrap: Wall Street surged on Monday, helped by a robust rally in oil prices that lifted recently crushed energy stocks, including Chevron and Schlumberger. As it has for months, Wall Street followed the lead of global oil prices in a trend that has left the S&P 500 down 5% so far in 2016, following a partial recovery last week. Monday's stock gains were as broad as they were strong, with all 10 major S&P sectors finishing higher, but investors shell-shocked by this year's market turbulence remained wary. - Reuters

The DJIA jumped 1.39% to end at 16,620.66 points. The S&P 500 gained 1.45% to 1,945.5 and the Nasdaq added 1.47% to 4,570.61.

Forex summary

*The ringgit rose 0.47% to 4.1778 per US$

*It increased 1% to 4.6081 per euro

*Up 0.75% to 5.9065 per pound sterling

*0.31% higher to 2.9832 per Singapore dollar

*0.05% lower to 3.0192 per Aussie

*Up 0.25% to 3.7080 per 100 yen

Energy

Oil markets settled up as much as 6% on Monday as speculation about falling US shale output and a rally in equities fed the notion that crude prices may be bottoming after a 20-month collapse. Futures of Brent LCOc1 finished up US$1.68, or 5%, at US$34.69. - Reuters

Top foreign stories

United orders 25 more Boeing 737s worth US$2b: Boeing Co has won an order for 25 current-generation Boeing 737 aircraft from United Continental Holdings Inc, beating rivals including Canada's Bombardier Inc for the second time in a month, two industry sources said on Monday. The deal, which is said to involve the 126-seat 737-700 model, would be worth just over US$2 billion at list prices. - Reuters

US to push for greater fiscal spending at G20: The United States will call on G20 countries this week to use fiscal policy in order to boost global demand, a senior US Treasury official said on Monday. "We will urge greater use of policy space, including fiscal space, to bolster global demand. That would lead to strengthened confidence and I would expect reduce volatility," the Treasury official said in a preview call with reporters ahead of a G20 meeting later this week in Shanghai, China. G20 finance ministers and central bank governors will meet on Feb. 26-27, - Reuters

Honeywell, United Tech held merger talks: Aerospace component suppliers Honeywell International Inc and United Technologies Corp have held merger talks, but the latter is convinced that a deal would not pass antitrust muster, sources said. A merger of the two firms would create a behemoth with combined sales of more than US$90 billion, a company responsible for a huge amount of equipment on commercial airliners, ranging from jet engines to airplane cockpits and landing gear. - Reuters

EFG agrees to buy BSI from Brazil's BTG Pactual for US$1.3b: EFG International AG has agreed to pay 1.33 billion Swiss francs (US$1.34 billion) for Grupo BTG Pactual SA's Swiss private-banking unit BSI Ltd in a deal that could catapult it into the nation's top-five money managers for the wealthy. - Reuters

Top local stories

EPF upbeat about returns: The Employees Provident Fund (EPF) is committed to its investment strategies and remains confident of achieving significant returns despite the prevailing challenges in the global market environment, says chief executive officer Datuk Shahril Ridza Ridzuan. He emphasised that the fund was not constrained from making investments as it deemed fit, be they in domestic or overseas assets.

* EPF's gross investment income amounted to RM44.23bil in 2015. 

* From 2008 to 2015, the pension fund’s total investment asset rose from RM350bil to RM685bil.

* Overseas investments totalled about RM171bil in 2015. - StarBiz

UEM Sunrise unit forms JV with Singapore firm: Developer UEM Land Bhd, a unit of UEM Sunrise Bhd, has formed a partnership with Singapore-based SUTL Marina Holdings Pte Ltd to undertake several projects in Puteri Harbour, Iskandar Puteri in Johor, which will collectively have an estimated investment cost of S$66.6mil (RM198.8mil). UEM Sunrise said the JV company will develop and operate a public marina, private marina and mega yacht marina in Puteri Harbour. - StarBiz

Ta Ann posts 168% higher Q4 earnings: Ta Ann Holdings Bhd's fourth-quarter earnings increased by 168.3% to RM57.98mil while for the full 2015 financial year profit rose by 50.4% to RM185.94mil. It cited the increase in production and sales volume of fresh fruit bunches and crude palm oil), as well as the higher average selling prices of export logs and plywood for the better results. Revenue for the quarter and the full year was RM268.8mil and RM1.047bil, respectively. - StarBiz

MRCB turns around in fourth quarter: Malaysian Resources Corp Bhd (MRCB) posted a net profit of RM26.79mil for its fourth quarter a net loss of RM5.28mil a year earlier due to the completion and sale of ongoing property projects. Revenue dropped to RM388.20mil from RM487.17mil a year earlier. - StarBiz

Kwasa Land inks deal with AZRB unit to develop land: Kwasa Land Sdn Bhd has inked a development rights deal with Ahmad Zaki Resources Bhd (AZRB) subsidiary AZ Land & Properties Sdn Bhd to develop the R3-4 site, covering 3.91 acres of freehold land in Kwasa Damansara. Kwasa Land managing director Datuk Mohd Lotfy Mohd Noh said the development would consist of 188 units of 162 high-rise twin-tower condominiums and 26 garden villas. - StarBiz

TM partners HK's PCCW to provide new VOD service: Telekom Malaysia Bhd (TM) has entered into a strategic partnership with video-on-demand (VOD) service provider Vuclip, a unit of Hong Kong-based PCCW Ltd. The partnership will see TM offering the service through its infrastructure. The service will be called Viu in Malaysia and made available to UniFi and Streamyx broadband customers. - StarBiz

Malaysian banks will remain resilient this year, says S&P: Poor’s Ratings Services (S&P) believes the banking sector in Malaysia will remain resilient this year despite the dampened business and consumer sentiment that has been hit by  slower economic growth exacerbated by weaker demand in China and sliding commodity prices. - Bernama

UOB: Ringgit to rebound this year: Receding domestic political and economic headwinds have improved the outlook for the ringgit, which is set for a rebound this year, says United Overseas Bank (M) Bhd (UOB). It said the ringgit would likely average at 4.25 per US dollar by mid-2016 before strengthening to 4.10 by the end of the year. The estimates were based on the revision in its US Federal Reserve rate outlook with fewer hikes this year and recent the ringgit strength. - StarBiz

Sunway plans RM1.6bil property launches: Sunway Bhd plans to launch properties with a gross development value (GDV) of RM1.6bil in the Klang Valley, Iskandar Malaysia, Ipoh and Penang. Last year, the group clinched RM1.2bil in sales, while unbilled sales stood at RM2.3bil as of end-2015. - StarBiz

AFGB net profit rises to RM135.6mil: Alliance Financial Group Bhd’s (AFGB) net profit for its third quarter rose 7.3% to RM135.6mil on a higher revenue of RM361.18mil from RM350.08mil a year earlier. AFGB chief executive officer Joel Kornreich said the group will continue to strengthen its balance sheet by growing its best performing segments and optimising its deposit and loan mix. - StarBiz

Bank Negara’s international reserves up 0.1% at US$95.6b: The international reserves of Bank Negara have increased margin- ally to US$95.6 billion (RM401.52 billion) as at Feb 15, compared with US$95.5 billion as at Jan 29 this year. In ringgit terms, the international reserves stood at RM410.2 billion as at Feb 15 from RM410.1 billion as at Jan 29. - Edge FD

DBE Gurney to see Taiwanese partners take up 20% stake: DBE Gurney Resources Bhd may see seven of its new Taiwanese partners take up a 20% equity stake in the company through a consortium entity at the current market price of five sen per share or equivalent to RM7.68 million. Managing director Alex Ding Seng Huat said his Taiwan counterparts have expressed interest in investing in the integrated poultry company, but further details are still being ironed out. - Edge FD

Fiamma Holdings Bhd

Time: 11am

Venue: Main Board Room, Level 10, Wisma Fiamma, Bandar Manjalara, Kuala Lumpur

At its EGM Fiamma seeks shareholder approval for:

* Share split involving the subdivision of one RM1 ordinary share into two 50 sen shares

* A 1-for-2 bonus issue of the subdivided shares

* An employee share option scheme of up to 15% of Fiamma's share capital.

Results announcement

* Nestle fourth quarter

* Kossan fourth quarter

* Unisem fourth quarter and briefing

* MSM fourth quarter and conference call

* Inari second quarter

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