Breakfast briefing: Wednesday, May 10


  • Business
  • Wednesday, 10 May 2017

MarketWrap: The S&P 500 fell on Tuesday after edging up to an intra-day record high for the second straight session, while Apple became the first US company to close with a market capitalisation above US$800 billion. The DJIA declined 0.17% to end at 20,975.78 points, the S&P 500 lost 0.10% to 2,396.92 points and the Nasdaq added 0.29% to close at a record high of 6,120.59, helped by Apple. - Reuters

Energy

Oil prices fell on Tuesday, rattled by concern over slowing demand, a rising US dollar and increasing US crude output that has shaken investors' faith in the ability of Opec to rebalance the market. Brent futures lost 61 cents, or 1.2%, to settle at US$48.73 a barrel. - Reuters

Forex summary

*The ringgit lost 0.26% to 4.3472 versus the US$

*It gained 0.06% to 4.7352 versus euro

*Down 0.10% to 5.6274 per pound sterling

*Up 0.06% to 3.0829 per Singapore dollar

*Down 0.09% to 3.1968 per Aussie

*0.15% lower to 3.8198 per 100 yen

Top foreign stories

ESPN concerns drag on Disney, shares dip: A decline in subscribers and higher programming costs at cash-cow ESPN weighed on shares of Walt Disney Co on Tuesday, overshadowing a quarterly profit that topped Wall Street estimates. For the quarter, adjusted earnings per share hit US$1.50, ahead of analysts' projection of US$1.41, according to Thomson Reuters I/B/E/S. Overall revenue for the quarter rose 2.8% to US$13.34 billion, but missed an analysts' estimate of US$13.45 billion. - Reuters

Bitcoin surges to all-time high above US$1,700: Digital currency bitcoin hit a record high on Tuesday as demand for crypto-assets soared with the creation of new tokens to raise funding for start-ups using blockchain technology. Bitcoin hit a record US$1,760.40 on the BitStamp platform and was last at US$1,747.89, up 6% on the day. So far this year, bitcoin has surged nearly 80%. Bitcoin's market capitalisation on Tuesday soared to US$52.5 billion, according to data from coinmarketcap.com. - Reuters

News Corp quarterly revenue beats on higher ad revenue: News Corp reported better-than-expected quarterly revenue as the owner of the Dow Jones Newswires and the Wall Street Journal saw an uptick in its digital real estate business and growth in its advertising revenue. News Corp posted better-than-expected third quarter revenue of $1.98 billion, up 4.6 percent from a year earlier. Net loss available to shareholders narrowed to US$5 million, or 1 cent per share, in the third quarter, from US$149 million, or 26 cents per share, a year earlier, when the company took a charge of US$280 million. - Reuters

Top local stories

PPB keeps cinema business: Diversified PPB Group Bhd plans to hold on to Golden Screen Cinemas Group (GSC), as there is still growth to be tapped. CEO Koh Mei Lee says he is bullish about the cinema operations and is confident GSC could do even better this year with the pipeline of movie titles - StarBiz

IRB seizes Lee Kim Yew’s fixed deposits in foreign bank: The Inland Revenue Board (IRB) has seized Country Heights Holdings Bhd (CHHB) executive chairman and major shareholder Tan Sri Lee Kim Yew’s fixed deposits placed with a foreign-owned bank amounting to RM126mil. Lee understood that it was in relation to a tax liability of CHHB’s wholly owned subsidiary, Country Heights Sdn Bhd (CHSB). CHHB said the total tax liabilities of CHSB for the years of assessment 1997 and 1998 amounted to RM22.5mil. - StarBiz

Ekuinas shelves plans to list Ilmu: Ekuiti Nasional Bhd (Ekuinas) has shelved plans to list its consolidated education group, Ilmu Education Group Sdn Bhd. CEO Syed Yasir Arafat Syed Abd Kadir said it had decided to relook its strategies on Ilmu after finding that the sum of parts valuation of the group was greater than its entire value. - StarBiz

Raja Arshad: More investments into Icon and Orkim: Ekuiti Nasional Bhd (Ekuinas) does not rule out putting more money into its oil and gas (O&G) portfolio companies Icon Offshore Bhd and Orkim Sdn Bhd. “Whether we will be putting more money into the companies will depend on their expansion plans moving forward,” says chairman Raja Tan Sri Arshad Raja Tun Uda. - StarBiz

Selangor Dredging to buy stake in Webcon Mining: Selangor Dredging Bhd via subsidiary SDB Connect Sdn Bhd is acquiring a 20% equity interest in Webcon Mining Sdn Bhd for RM20mil. Selangor Dredging said the acquisition represents a strategic and significant entry for the company into the mining sector. – Bernama

UOB: Ringgit likely to regain strength to average at 4.35: The ringgit is expected to regain its strength supported by the country’s economic fundamentals, although market sentiment could cause fluctuations in its value, says United Overseas Bank (M) Bhd. UOB economist Julia Goh said the currency would likely average 4.35 by mid-2017 before appreciating to around 4.30 by the year-end.

Digital investment manager rules launched: Guidelines for parties wishing to run digital investment management (DIM) services out of Malaysia have been launched, a move which should lead to new investment options for the public. Following the passing of rules relating to equity crowd-funding and peer-to-peer (P2P) lending, the Securities Commission (SC) has now introduced the framework for DIM, making the regulator one of the more advanced in this region with regard to initiatives to bring financial inclusion to the masses through the use of technology. - StarBiz

TNB signs new deals to extend YTL Power’s Paka plant ops: Tenaga Nasional Bhd (TNB) has signed new deals with YTL Power International Bhd to extend the operations of the latter’s power plant in Paka, Terengganu, for a further  three years and 10 months. - StarBiz

EKA Noodles subsidiaries resume operations: Eka Noodles Bhd said its unit EKA Foodstuff Sdn Bhd had fully resumed operations on Tuesday, while another unit Kilang Bihun Bersatu Sdn Bhd would fully resume operations next month. - StarBiz

Malaysia Smelting Corp posts lower net profit: Malaysia Smelting Corp Bhd’s net profit for its first quarter dropped by about 30% year-on-year to RM17.43mil, mainly due to the absence of a favourable inventory valuation adjustment and a higher net foreign-exchange loss. Revenue was down 0.44% to RM406.61mil from RM408.40mil a year earlier. - StarBiz

Hartalega Q4 net profit up 45% on higher sales revenue: Hartalega Holdings Bhd’s net profit rose 45.3% to RM89.4mil for the fourth quarter on higher sales revenue, improvement in operational efficiency and reduction in operation overheads. Revenue increased 31.6% in to RM527mil. - StarBiz

DiGi to maintain capex at 2016 level: Digi.com Bhd will maintain capital expenditure (capex) at the 2016 level this year. Its capex guidance for 2017 is 11% to 13% of service revenue, primarily to be used for network expansion and digital transformation. The telecommunications provider’s capex in 2016 was RM780mil. - StarBiz

IMF says Asia facing risks from rise in protectionism: The International Monetary Fund (IMF) said Asia’s economic outlook faces “significant” uncertainty and downside growth risks from any sudden tightening in global financial conditions or rise in protectionist trade policies. The IMF, which in April raised its 2017 Asia-Pacific growth forecast to 5.5% from its previous October forecast of 5.4%, said loose monetary and fiscal policies across most of the region would underpin domestic demand. - StarBiz

RAM sees stronger UMW after exit from O&G: RAM Ratings expects UMW Holdings Bhd to emerge stronger after it exits the loss-making oil and gas (O&G) sector but cautions that any delays will erode its retained earnings. The ratings agency also reaffirmed the AA2/Stable/P1 ratings of UMW’s Islamic debt programmes. - StarBiz

Gadang JV secures RM327mil job: Gadang CRFG Consortium Sdn Bhd, 51:49 joint venture between Gadang Engineering (M) Sdn Bhd and CRFG Malaysia Bhd, has bagged a RM327.90mil contract to upgrade part of the Jalan Tun Razak highway. - StarBiz

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