Daily News - 5 Aug 2020

Industrial Insight > Daily News - 5 Aug 2020
5 Aug 2020
Compiled by AllianceDBS Research


Kossan, Green Ocean and AT Systematization refute news report on formation of glove-making pact

Kossan Rubber Industries, Green Ocean Corp and AT Systematization have denied that they are in a partnership to form a glove-making pact. In separate bourse filings, the three companies refuted a news report that said they were working together on a partnership. "Kossan wishes to clarify that the company is neither aware of nor involved in the abovementioned glove-making pact or tripartite partnership. Meanwhile, the board of Green Ocean also clarified that there has been no discussion taking place among the parties for a joint venture of any kind. "Green Ocean is committed to charting its own course of action independently and will keep the market informed on any developments that materialise," the company said. Likewise, the board of AT Systematization also denied such an agreement exists. (The Edge Markets)

Proton sold 13,216 cars in July, highest in eight years

Proton sold 13,216 cars in July this year, which was its highest since June 2012 as Malaysia recorded a rebound in car sales due to f tax free incentives and consumer demand. The national car maker announced on Tuesday it had benefited from the higher sales as Malaysian automotive brands once again dominated the market with an estimated 63.2% of sales this month. “With 13,216 units sold, July was Proton’s best sales month in 2020 thus far and is also its highest monthly sales volume since June 2012.“Four models ended July as sales leaders in their respective segments as overall sales grew by 37.3% (13,216 vs 9,623) over June 2020 and increased by 45.7% (13,216 vs 9,072) over the same month in 2019, ” it said. Proton's year-to-date market share as at July 2020 was 21.8%, which was a growth of 6.7% when compared with the previous corresponding period. (Starbiz)

Alam Maritim awarded 5-year contract from Repsol Oil & Gas Malaysia

Alam Maritim Resources announced that its wholly-owned subsidiary, Alam Maritim (M) Sdn Bhd, has received a letter of award from Repsol Oil & Gas Malaysia Ltd for the provision of subsea inspection, maintenance and repair services for PM3-CAA. In a filing to Bursa Malaysia, Alam Maritim said the contract value is as per the work order request by Repsol Oil & Gas Malaysia for a duration of five years. The contract has been effective since June 30, 2020 with its first vessel mobilisation for this year targeted for the middle of August. (The Edge Markets)

Aneka Jaringan obtains Bursa Malaysia’s approval for ACE Market listing

Aneka Jaringan Holdings has clinched Bursa Malaysia’s approval for its initial public offering (IPO) on the ACE Market To date, the group has completed a total of 137 foundation and basement construction projects in Malaysia. The managing director revealed that the bulk of the proceeds will be utilised for the expansion of its fleet of construction machinery and equipment in Malaysia. Aneka Jaringan’s IPO will comprise a total of 139.9m shares wherein 26.9m shares will be made available to the Malaysian public, 13.5m shares will be set aside for eligible directors, employees and business associates, 45.7m shares will be offered via private placement to selected investors and the remaining 53.8m shares for bumiputra investors approved by the Ministry of International Trade and Industry. (The Sun Daily)


The Fed is expected to make a major commitment to ramping up inflation soon

In the next few months, the Federal Reserve will be solidifying a policy outline that would commit it to low rates for years as it pursues an agenda of higher inflation and a return to the full employment picture that vanished as the coronavirus pandemic hit. Recent statements from Fed officials and analysis from market veterans and economists point to a move to “average inflation” targeting in which inflation above the central bank’s usual 2% target would be tolerated and even desired. To achieve that goal, officials would pledge not to raise interest rates until both the inflation and employment targets are hit. With inflation now closer to 1% and the jobless rate higher than it’s been since the Great Depression, the likelihood is that the Fed could need years to hit its targets. The policy initiatives could be announced as soon as September. Addressing the issue last week, Fed Chairman Jerome Powell said only that a year-long examination of policy communication and implementation would be wrapped “in the near future.” The culmination of that process, which included public meetings and extensive discussions among Fed officials, is expected to be announced at or around the Federal Open Market Committee’s meeting. (CNBC)

US: Home prices see strong June bounce, but economists warn it likely won’t last

The first read on home prices in June is proving just how resilient the housing market has been in the face of an ongoing economic disaster. Strong demand for housing, much of it pushed by the coronavirus pandemic itself, is driving prices higher faster, but forecasters say that may not last. Nationally, home prices increased by 4.9% annually in June, a much greater gain than the 4.1% annual rise in May, according to Core Logic. Prices climbed 1% m-o-m, which is the fastest monthly gain for June since 2013. Prices got a boost from record low mortgage rates, which give buyers more purchasing power. The average rate on the popular 30-year fixed mortgage jumped up to 3.24% at the start of the month, but then fell precipitously, ending June at 2.94%, according to Mortgage News Daily. (CNBC)

Eurozone producer prices return to rise m-o-m, beat expectations

Eurozone producer prices rose in June on a monthly basis slightly more than expected, ending their falling trend started in February when the bloc experienced its first COVID-19 outbreaks, official estimates showed on Aug 4. Prices at factory gates in the 19-country currency bloc increased in June by 0.7% m-o-m, the European Union’s statistics office Eurostat said. The reading beat forecasts from economists polled by Reuters of a 0.5% rise, and was the first increase after prices had fallen for four consecutive months. It was driven by a 3.1% rise in energy prices. Otherwise, producer prices would have been flat on the month. On the year, producer prices fell in June by 3.7%, less than the 3.9% drop expected by economists, and down from the 5.0% decline posted in May. Producer prices are a key factor shaping consumer inflation, as changes in prices at factory gates largely translate into the final cost for consumers. Eurozone annual consumer inflation ticked up by 0.4% in July after a 0.3% rise in June. (Reuters)

China only fulfills 5% of Sino-US energy trade deal in first half of 2020

China bought only 5% of the targeted USD25.3bn in energy products from the United States in the first half of 2020, falling well short of its trade deal commitments at a time when relations between the two top economies are already sour. China’s imports of crude oil, liquefied natural gas (LNG), metallurgical coal and other energy products totaled around USD1.29bn this year through June, according to Reuter’s calculations based on China customs data. While Chinese purchases of US products accelerated recently, analysts say weak energy prices and worsening relations means Beijing may undershoot its full-year goal in the Phase 1 deal agreed in January. (Reuters)