Breakfast briefing: Tuesday, November 7 (Update)


Mega deal: Avago did its US$37bil (RM152.9bil) deal for Broadcom last month.

MarketWatch: US stocks climbed to record highs on Monday, helped by optimism about merger activity and as investors bet that a Republican plan to cut corporate taxes would bolster earnings. The DJIA inched up 0.04% to end at 23,548.42, while the S&P 500 gained 0.13% to 2,591.13. The Nasdaq added 0.33% to 6,786.44. - Reuters

 

Energy

 

Oil prices rose 3.5% on Monday, hitting the highest since early July 2015, as Saudi Arabia’s crown prince cemented his power with an anti-corruption crackdown, while the US rig count fell and markets continued to tighten. Brent crude futures LCOc1 settled up US$2.20, or 3.5%, to US$64.27 per barrel. - Reuters

 

Forex summary

*The ringgit gained 0.08% to 4.2283 versus the US$

*Up 0.26% to 4.9069 versus euro

*Down 0.28% to 5.5671 per pound sterling

*Up 0.04% to 3.1039 per Singapore dollar

*Down 0.22% to 3.2494 per Aussie

*Up 0.27% to 3.7114 per 100 yen

 

Top foreign stories

 

Broadcom bids US$103b for Qualcomm, open to going hostile: Chip maker Broadcom Ltd made an unsolicited US$103 billion bid for Qualcomm Inc on Monday, setting the stage for a takeover battle that could reshape the industry at the heart of mobile phone hardware. Qualcomm said it would review the proposal but the company is inclined to reject the bid as too low and fraught with risk that regulators may reject it or take too long to approve it, sources said. - Reuters

 

General Electric mulls options for aircraft leasing unit: General Electric Co is exploring options for its aircraft leasing operations, including the sale of all or part of the business, as chief executive John Flannery searches for new divestitures, say sources. GE is considering options for GE Capital Aviation Services, the world’s second-largest lessor, following expressions of interest from some of its competitors, they said. - Reuters

 

Fox held talks to sell most of company to Disney: Rupert Murdoch’s Twenty-First Century Fox has held talks to sell most of its film and television assets to Walt Disney Co, which would gain new programming and expand its international reach, CNBC reported on Monday. The discussions reflect a view among Fox executives that the media company could not reach the size needed to compete with Amazon.com Inc, Netflix Inc and other major media players, the report said. - Reuters

 

Sprint shares plunge after T-Mobile merger talks called off: Sprint Corp’s shares fell more than 13% on Monday after the No. 4 US wireless carrier called off merger talks with T-Mobile US Inc and a wireless partnership with cable company Altice USA failed to appease investors. - Reuters

 

NZ finance minister says will launch review of central bank mandate: The New Zealand government launched a review of its central bank act on Tuesday, making good on an election promise to include maximising employment as a goal and instituting a committee-based decision-making model. New Zealand Finance Minister Grant Robertson said there was no plan to include the New Zealand dollar, the world’s 11-most traded currency, in the review - remarks that pushed the currency up around a quarter of a US cent. - Reuters

 

Top local stories

 

MBSB agrees to buy AFB for RM645m: Malaysia Building Society Bhd (MBSB) has agreed to acquire Asian Finance Bank Bhd (AFB) in a RM644.95mil deal that will give it the licence to become a full-fledged Islamic bank after two previous attempts to its transform itself into a bank.  The acquisition will be settled via cash and issuance of new MBSB shares. - StarBiz

 

Retailers to be allowed to buy bonds, sukuk: The authorities are looking to allow retail investors to buy bonds and sukuk sold in the wholesale market by the first quarter of next year. The rules are likely to be tweaked to allow retail investors to buy wholesale bonds, although it is likely they would only have access to highly rated bonds so as to reduce the risks. - StarBiz

 

SC, Bank Negara working on cryptocurrency guidelines: The Securities Commission (SC) chairman Tan Sri Ranjit Ajit Singh said the regulator, along with Bank Negara, was still working on the guidelines for the digital currency and will likely unveil a framework in the coming months. Ranjit declined 

to give a specific time frame. - StarBiz

 

IJM wins HSBC contract: IJM Corp Bhd has secured a contract from HSBC Bank Malaysia Bhd to undertake the design and construction of the lender’s new headquarters in Jalan Tun Razak, Kuala Lumpur, for RM392mil. - StarBiz

 

Govt to set up RM50m co-investment fund: The Government will set up a co-investment fund with RM50mil from existing grants to be invested in small and medium enterprises (SMEs) with private investors through equity crowdfunding and peer-to- peer platforms. Second Finance Minister Datuk Seri Johari Abdul Ghani said the Securities Commission would help set up the fund and define the co-investment criteria for both equity and debt financing. - Bernama

 

PNB adopts ‘opportunistic’ approach: Permodalan Nasional Bhd (PNB) is taking an opportunistic approach in determining the direction of its interna- tional investments to ensure depositors get high returns. Chairman Tan Sri Abdul Wahid Omar said the group is studying the right market, including the United States, Europe, Asean and North Asia, as well as right timing to grow its international investments, currently which at about 2%. - Bernama

 

Market gives thumbs up to FGV’s latest cost-cutting measures: Felda Global Ventures Holdings Bhd’s (FGV) latest cost-cutting measure has received the thumbs up fom the market, with investors pushing up the shares six sen to RM1.89 on Monday. Hong Leong Investment Bank Research said although the expected cost savings and one-off VSS expenses are not known, it believes the exercise will improve FGV’s earnings significantly, given its low earnings base. - StarBiz

 

Demand for steel to pick up: AmInvestment Bank Research expects the local demand for steel to pick up following the roll-out of mega infrastructure projects such as rail-related projects and township development. The research house maintained its “overweight” stance on the steel sector. - StarBiz

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