THE focus this week will be on corporate earnings as more companies are due to release their results for the fourth quarter of last year.
Kuala Lumpur Kepong Bhd (pic of KLK plantation) and MR D.I.Y. Group (M) Bhd are expected to announce their quarterly earnings on Wednesday. MISC Bhd will release its fourth quarter results on Thursday while Petronas Dagangan Bhd and Malakoff Corp Bhd on Friday.
According to estimates, MR D.I.Y is expected to report a revenue of RM670mil and net income of RM106.3mil in the fourth quarter ended Dec 31,2020.
Affin Hwang Capital Research said MISC’s fourth-quarter 2020 results are expected to remain weak on the back of sequential weakness in freight rates, and higher liquefied natural gas (LNG) vessels docking days.
It said the rising Covid-19 cases continued to dampen global demand and will likely impact the upcoming results, as its current petroleum portfolio mix is skewed more towards spot rates where the term:spot ratio is at 65:35 (76:24 in second-quarter 2020).
The research firm believes recovery in rates will come in at a slow pace and back-loaded towards the second half of 2021, especially after recent news that Saudi Arabia will voluntarily cut production by another one million barrels per day in February and March 2021.
Singapore’s budget, GDP
SINGAPORE’S Budget 2021 is expected to be announced tomorrow while the final print for its fourth-quarter gross domestic product (GDP) will be released today.
RHB Investment Bank anticipates the Budget 2021 to be expansionary – albeit at a smaller magnitude.
It expects an improvement in the fiscal deficit to 1.8% of GDP, slightly below consensus of -2% to -4%, from 15.6% in 2020.
RHB also expects revenue to improve as the city-state slowly climbs out of its slump in 2020 but should remain below pre-Covid-19 levels.
It said expenditure is expected to narrow as support measures take a more targeted approach to struggling sectors rather than the broad-based approach seen in the four budgets in 2020.
UOB Global Economics & Markets Research expects Budget 2021 to centre on helping the country recover from the Covid-19 pandemic and emerge stronger while at the same time, revisit medium to long-term measures to develop Singapore’s advanced manufacturing capabilities, digital connectivity and accelerate its industry transformation.