Breakfast briefing: Tuesday, April 19


MarketWrap: The Dow Jones industrial average climbed to a nine-month high on Monday, in a market buoyed by Hasbro and Disney, as investors braced for a flurry of quarterly earnings reports through the week. - Reuters

DJIA rose 0.6% to end the day at 18,004.16 points, the S&P 500 gained 0.65% to 2,094.34 and the Nasdaq added 0.44% to 4,960.02.

Forex summary

*The ringgit rises 0.67% to 3.9032 per US$

*It rises 0.63% to 4.4151 per euro

*Down 0.09% to 5.5796 to the pound sterling

*0.28% up to 2.8906 per Singapore dollar

*0.29% lower to 3.0329 per Aussie

*Up 0.81% to 3.5815 per 100 yen

Energy

Oil prices slid on Monday after a plan by major oil producers to freeze production was scuttled, but a Kuwaiti oil industry strike helped the market pare losses and settle off the day's lows. The strike crippled more than 60% of Kuwait's crude output, lending support to price benchmarks such as Brent and Dubai. Brent settled down 19 cents, or 0.4%, at US$42.91 a barrel. It had fallen US$3 earlier in the session. - Reuters

Top foreign news

IBM reports worst revenue in 14 years: International Business Machines Corp reported first-quarter revenue that beat analysts' estimates on Monday, but Big Blue's worst revenue in 14 years sent its shares down nearly 5% in extended trading. The company's revenue fell 4.6% to US$18.68 billion in the first quarter ended March 31, but beat analysts' average estimate of US$18.29 billion. - Reuters

Weak markets leave Morgan Stanley struggling to reach RoE target: Morgan Stanley's trouble growing revenue in weak markets may prompt management to take further actions to achieve financial goals, Chief executive James Gorman said on Monday. The Wall Street bank released first-quarter results showing that its profit tumbled by more than half. Morgan Stanley's return-on-equity, a key measure of how well it uses shareholder capital to earn profits, was 6.2%, well below Gorman's goal of 9% to 11% by the end of next year. - Reuters

Hutchison in make-or-break decision as EU veto on O2 deal looms: CK Hutchison Holdings faces a make-or-break moment as it ponders whether to ramp up concessions or face an EU regulatory veto over its 10.3-billion-pound (US$14.6 billion) bid to become Britain's biggest mobile operator. - Reuters

Top local stories

Nazir: ‘Reputation of the bank my priority’: Datuk Seri Nazir Razak takes leave of absence as chairman of CIMB Bank until a review of anti-money laundering processes at bank is completed. Nazir said his leave of absence as chairman of the group was to ensure the reputation of the bank remains intact. - StarBiz

CIMB to start ops in Vietnam by year-end: CIMB Group Holdings Bhd expects to start operations in Vietnam by the end of 2016. The financial services group received in-principle approval from Vietnam’s central bank in August 2015 to and operate a 100%-owned subsidiary, offering a comprehensive range of wholesale, commercial and consumer banking products and services. - StarBiz

Puncak signs accord with TRIplc on acquisitions: TRIplc Bhd has entered into a heads of agreement with Puncak Niaga Holdings Bhd on the potential acquisition of businesses between the two parties, which have the common substantial shareholder. - StarBiz

Malakoff withdraws resolution on directors’ fees: Malakoff Corp Bhd has withdrawn its proposed resolution on directors’ fees at its April 21 AGM following feedback from shareholders.

Star unit assembles the Avengers in Paris: The Avengers Station (Scientific Training and Tactical Intelligence Operative Network) interactive attraction has now spread its wings to Paris. After its runs in New York City’s Times Square and in Seoul, South Korea, the French opening of the Avengers Station marks the exhibit’s debut in Europe. - StarBiz

Can-One says KWAP keen on dairy unit: Can-One Bhd said Kumpulan Wang Persaraan (KWAP), among other parties, has expressed interest to acquire equity interest in its dairy subsidiary F&B Nutrition Sdn Bhd. But Can-One said no formal proposal or offer has been made for F&B Nutrition. - StarBiz

Government to honour its commitments: The Government will honour all outstanding commitments in the financial market, the Ministry of Finance (MoF) said in a statement.
This is in relation to disputes between 1Malaysia Development Bhd (1MDB), a company 100% owned by MoF, and Abu- Dhabi-based International Petroleum Investment Co (IPIC) over, among others, the obligations of 1MDB and IPIC in respect to certain publicly-issued notes. - StarBiz

1MDB: All bank and short-term debt repaid: 1Malaysia Development Bhd (1MDB) has repaid in advance a US$150mil term financing facility from EXIM Bank and a RM2bil credit facility for purchase of Tanjong plc's power assets. Following this payment, 1MDB said it has now fully-repaid all its bank and short-term debt. - StarBiz

Spring Gallery inks RM176mil deal with Prinsip Nusantara: Spring Gallery Bhd unit Profit Sunland Sdn Bhd has inked a managing contract agreement worth RM176mil with Prinsip Nusantara Sdn Bhd. Spring Gallery said the agreement was for the development of a 2.43ha land in Pulai, Johor Baru, into a commercial project. - Bernama

Affin to beef up investment banking: Affin Holdings Bhd , the parent of Affin Bank Bhd, aims to increase contribution from investment banking, as loan growth at the bank is expected to remain sluggish this year. The group is targeting to maintain the level of loan growth at 5% to 7%. - StarBiz

Property sales recovery likely in second half: Property sales are expected to recover in the second half of 2016, driven by higher consumer confidence and improved economic outlook. CIMB Research said in a report the local property sector was “not as dire as initially thought.” - StarBiz

Bank of Chengdu listing still on the cards: The listing of the Bank of Chengdu is still on the cards, but it is not expected to enhance the valuations of Hong Leong Financial Group in the near term, said Maybank Investment Bank Research. It said this was based on the recent listings of two Chinese lenders, China Zheshang and Bank of Tianjin, at historical price per net tangible assets of about one time. - StarBiz

KEB sells first tranche of Talam shares: A total 500 million shares, or an 11.8% stake, in Talam Transform Bhd were crossed off-market at 8.5 sen apiece as part of a share sale agreement between Kumpulan Europlus Bhd (KEB) and Talam’s substantial shareholder Tan Sri Chan Ah Chye. - StarBiz

MMHE shifts focus to marine business: Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE) is shifting gears and will start focusing on its marine business this year, amid a slowdown in the offshore oil and gas sector. Chairman Datuk Nasarudin Md Idris said it is targeting a revenue of RM640 million from the marine segment in FY16, up 37% from RM466.7 million a year earlier. - Edge FD

Loss-making Megasteel cuts workforce by half: The country’s largest hot-rolled coil producer, Megasteel Sdn Bhd, said it has since January laid off 487 workers (including 99 foreigners) and retrenched 102 from its total workforce of 1,148. - Edge FD

AGMs/EGMs

PJ Development Holdings Bhd

Time: 9.30am

Venue: Grand Hibiscus, Level 3, Swiss-Garden Hotel & Residences Kuala Lumpur, Jalan Pudu, Kuala Lumpur

OSK Holdings Bhd

Time: 2.30pm

Venue:  Grand Hibiscus, Level 3, Swiss-Garden Hotel & Residences Kuala Lumpur, Jalan Pudu, Kuala Lumpur

Ken Holdings Bhd

Time: 10am

Venue: Dewan Berjaya, Bukit Kiara Equestrian & Country Resort, Jalan Bukit Kiara, Kuala Lumpur

MISC Bhd

Time: 10.30am (AGM)/12pm (EGM)

Venue: Sapphire Room, Level 1 Mandarin Oriental Kuala Lumpur Kuala Lumpur City Centre, Kuala Lumpur

* MISC seeks shareholder approval for acquisition of the remaining 50% equity interest in Gumusut-Kakap Semi-Floating Production System (L) Ltd from E&P Venture Solutions Co Sdn Bhd for US$445 million cash.

Cycle & Carriage Bintang Bhd

Time: 9am

Venue: Concorde Ballroom 1, Lobby Level, Concorde Hotel, Jalan Sultan Ismail, Kuala Lumpur

Box-Pak (Malaysia) Bhd

Time: 10am

Venue: Conference Room of Box-Pak (Malaysia) Bhd, Lot 4, Jalan Perusahaan Dua, Batu Caves, Selangor

Berjaya Corporation Bhd

Time: 10am

Venue: Perdana Ballroom, Bukit Jalil Golf & Country Resort, Jalan Jalil Perkasa 3, Bukit Jalil, Kuala Lumpur

* Berjaya Corp seeks shareholder approval for the acquisition of 12% equity interest in Berjaya Land Bhd for RM419.11 million.

Breakfast Briefing