Retail News CRM

Category: Finance

Retail News Asia is committed to providing both local and global retailers with the latest Finance news throughout the Asian market. This on a daily base.

  • CIMB Group Q3 net profit up 4.2%

    CIMB Group Q3 net profit up 4.2%

    CIMB Group Holdings Bhd posted 4.2% higher net profit for the third quarter ended Sept 30, 2018 of RM1.18 billion, compared with RM1.13 billion for the same quarter in 2017 with contribution from all segments except wholesale banking. This was despite group revenue coming in 6.4% lower at RM4.14 billion, compared with RM4.42 billion.

    CIMB Group said the decline in operating in the quarter under review, was attributed to declines in non-interest income and net interest income of 17.0% and 1.6%, respectively.

    Consumer Banking profit before tax (PBT) grew 3.9% year-on-year (Y-o-Y) from better cost management. Regional Commercial Banking PBT rose 450.0% Y-o-Y from the reduction in provisions. Wholesale Banking PBT was 41.7% lower Y-o-Y across all wholesale segments given the weaker capital markets. Group Asset Management and Investments (Gami) PBT was 542.9% higher Y-o-Y from improvement in private markets, while Group Funding for the third quarter ended Sept 30, 2018 PBT was flat Y-o-Y.

    “As 2018 draws to a close, we remain on track to meet our key T18 targets. However, we remain cautious amidst weaker regional economies and global trade tensions. Against this backdrop, we will continue to control asset quality and cost across all businesses and geographies, while we finalise our next mid-term plan to propel CIMB onto a stronger growth trajectory,” said Group Chief Executive Tengku Datuk Seri Zafrul Aziz.

    Net profit for the nine month period was 30.8% higher at RM4.47 billion, compared with RM3.41 billion for the period ended Sept 30, 2017.

    Revenue for the period was also higher at RM13.31 billion, compared with RM13.11 billion.

    Lees ook:

    Lees ook:

  • Trade war refugees race to relocate to Vietnam, Thailand

    Trade war refugees race to relocate to Vietnam, Thailand

    Experts say this is the biggest shift in cross-border supply chains since China joined the World Trade Organisation in 2001. Fred Perrotta spent four years building a network of Chinese suppliers for his line of trendy backpacks, but as soon as the United States announced tariffs on almost half of its Chinese imports, he started looking for suppliers in other countries.

    That process is now so far advanced it would be too late to reverse it even if U.S. President Donald Trump and his Chinese counterpart Xi Jinping call a truce in their growing trade war at this week’s G20 summit, the 33-year-old said.

    Perrotta’s company, Tortuga, is joining what industry experts say is the biggest shift in cross-border supply chains since China joined the World Trade Organisation in 2001.

    The shift is creating stiff competition to secure new facilities in neighboring countries and rebuild supply chains outside of China, home to a fifth of global manufacturing.

    “Everyone is nervous and scrambling around,” Perrotta said by phone from Oakland, California, where he recently took delivery of the first samples from a potential new supplier in Vietnam.

    “Long-term, we will probably shift everything.”

    The scramble is driven by the risk of more, and higher, U.S. tariffs on China, and fears that nearby emerging economies can only accommodate new businesses on a “first come, first served” basis.

    Vietnam and Thailand are emerging as preferred destinations, but they still face capacity constraints ranging from red-tape to skilled labor and limited infrastructure.

    Frenzied activity 

    In an interview with more than a dozen company executives, trade lawyers and lobby groups in various industries revealed a frenzy of activity across Asia in recent months: executives are requesting product samples, touring industrial parks, hiring lawyers and meeting with officials.

    In June, Hong Kong-listed furniture maker Man Wah Holdings bought a factory in Vietnam for $68 million and said earlier this month it plans to almost triple its capacity to 373,000 square meters by the end of 2019.

    “The acquisition is to mitigate the risks posed by tariffs,” Man Wah said in a statement.

    Vietnam-based industrial real estate developer BW Industrial says inquiries have surged since October, and all its factories are now leased out.

    “The manufacturers are from all over the world but they all have production plants in China and need to start production ASAP,” Chris Truong, a sales manager at BW Industrial said.

    In Thailand, SVI Pcl, which provides electronics and manufacturing solutions, said it has just selected four new deals worth about $100 million with existing customers who have operations in China.

    “The trade war is good for us,” CEO Pongsak Lothongkam said. “We have been approached by so many companies that we have to prioritize.”

    KCE Electronics, Southeast Asia’s biggest maker of printed circuit boards (PCBs), has been contacted by U.S. companies who want to seek a new supplier to replace one in China, CEO Pitharn Ongkosit said.

    “It’s a good opportunity. Many customers have contacted us to ask about our products and prices. But there are no sales yet as it will take time,” he said.

    Stars Microelectronics Pcl, another Thai electronics manufacturing services provider, is also getting new business.

    “Two (or) three companies will start moving their production base (out of China) to us soon,” CEO Peerapol Wilaiwongstien said.

    Cambodia is also attracting interest, with Parsippany, NJ-based bicycle maker Kent International Inc shifting Chinese production to the Southeast Asian country.

    “We have a big business in the United States,” Arnold Kamler, the company’s majority owner and chief executive said. “There is no choice but to as rapidly as possible look to move production away from China.”

    Disruption 

    The re-sourcing and relocation efforts mark an acceleration of an already established trend as China’s economy shifts towards services, consumption and high-tech production.

    “We are on the cusp of the biggest sourcing disruption that we have seen in a generation,” said Stephen Lamar, executive vice-president of the American Apparel&Footwear Association, whose more than 1,000 members contribute over $400 billion annually to U.S. retail sales.

    “The No. 1 thing I hear from companies is along the lines of: ‘For years we have been talking about diversifying from China and now we have to actually do it’.”

    Shifting production can take years to complete: firms need to secure funding, find the right suppliers, sort out new logistics – all while dealing with new legal and accounting issues in a country they may not know well.

    “Any relocation away from China is going to be very slow and very uncertain,” said Aidan Yao, senior Asia EM economist at AXA Investment Managers.

    Low tech goods and low value manufacturing would be the quickest to migrate while higher value-added exports in the machinery, transport and IT category would likely take decades to relocate due to high R&D costs and competitive Chinese labor costs, UBS said in a note earlier this month.

    Yet a regional client poll by Citi conducted in the last month showed more than half of them already adjusting their supply chain to limit upheaval to their business.

    China’s sophistication in areas such as automation means no one country can replace China, said trade lawyer Sally Peng of Sandler, Travis&Rosenberg.

    “So everyone is looking for that China Plus One, Plus Two, Plus Three country strategy, all the way to Africa,” she said.

    Companies hold out little hope for a truce in the trade dispute when Trump and Xi are due to meet on the sidelines of the G20 summit in Buenos Aires this week.

    Indeed, Trump said on Monday he expected to move ahead with raising tariffs on $200 billion in Chinese imports to 25 percent from the current 10 percent.

    While Chinese export data shows little sign yet of an impact from the trade war, some economists say that is because companies are rushing to get shipments out ahead of more tariffs.

    Collateral victims 

    To be sure, smaller emerging Asian economies are not necessarily licking their lips about the prospect of the trade war between the world’s top two economies worsening.

    Growth has slowed in the third quarter across Southeast Asia, as well as in Taiwan, Japan and South Korea, with officials partly blaming the trade war for it.

    Thailand’s exports of electronic integrated circuits, for instance, rose 4 percent to the United States in October but fell 38 percent to China. Vietnam’s manufacturing sentiment indicator is the highest in Asia but is well off its peak.

    A lack of infrastructure is also a problem for countries seeking to pick up business.

    Thailand is 41st in World Bank infrastructure quality rankings, Vietnam is 47th, compared to China’s 20th ranking.

    Bangkok is seeking to address that with its Eastern Economic Corridor, an ambitious $45 billion development project which plans improvements to deep water ports, airports and railways.

    Beyond infrastructure bottlenecks, red tape – particularly in Vietnam – remains hard to navigate and skilled labor is not easily available.

    Vietnam’s unemployment rate is 2.2 percent. Thailand’s is even lower.

    “The proportion of unskilled labor in Vietnam remains large and there hasn’t been any effective plan to improve this issue, and I don’t see any significant change in five or even 10 years,” said the vice chairman of the Vietnam Electronic Industries Association, Nguyen Phuoc Hai.

    “Whether cheap labor will remain one of Vietnam’s advantages in the face of the fourth industrial revolution is questionable.”

  • Vietnam’s blue chips fall faster than stock market plunge

    Vietnam’s blue chips fall faster than stock market plunge

    As business results fall short of targets, Vietnamese blue chips are falling faster than the stock market’s continued plunge. Vietnam’s benchmark VN-Index dropped 23.5 percent to 917.97 points on Friday from its April peak over 1,200 points. In corresponding comparison, the fall in value of blue chips stocks has been more than twice as high. A share of Vietnam’s leading stone manufacturer Vicostone (VCS) on Friday was worth VND75,000 ($3.2), down 47 percent from its peak on April 4 at VND141,600 ($6.06).

    Analysts at that time called the stock a “phenomenon,” as its value surged 50 times from VND3,000 (13 cents) in mid-2014 on the Hanoi Stock Exchange (HNX).

    Vicostone’s profits also rose over 50 percent a year from 2014 to 2017, while its revenue increased from VND2 trillion ($85.64 million) to VND4.35 trillion ($186.27 million) in the same period.

    But this year, maintaining double-digit growth seems to be a challenge for the company as its revenue has stayed the same year-on-year at VND3.2 trillion ($137 million), while net profit fell 7 percent to VND790 billion ($33.82 million) in the first nine months of this year.

    Although the company has reassured shareholders that business is normal and that Vicostone plans to buy its own shares to stop the falling momentum, investors have been selling their holdings at increasing speeds.

    A similar situation can be seen at the Vietnam Prosperity Joint-Stock Commercial Bank (VPBank). Its stocks on Friday morning closed at VND21,950 (94 cents), dropping 48.7 percent from its peak on April 9 at VND42,826 ($1.83).

    Last year, as it focused specifically on consumer finance, the bank’s stocks was one of the most sought-after when it was listed on the Ho Chi Minh City Stock Exchange (HOSE) in August.

    But its stocks value has been dropping this year because business results are not as expected, analysts say.

    The company gained a consolidated net profit of VND4.9 trillion ($209.82 million) in the first nine months, up nearly 9 percent year-on-year, but only 60 percent of the year’s target.

    Securities firm Viet Capital Securities (VCSC) said in its recent report that the bank is not likely to meet targets set earlier this year. It said its own forecast on VPBank’s profit and stock prices for the year could be revised downwards 15-20 percent.

    Major plastic stocks are also falling in value.

    Binh Minh Plastic (BMP) and Tien Phong Plastic (NTP), the country’s two leading plastic producers, had their stock values plunge 50 percent from their peak last year.

    The two companies recorded high growth from 2010-2016. Binh Minh Plastic’s revenues went up from VND1.4 trillion ($59.95 million) to almost VND3.7 trillion ($158.43 million), with gross margin going up to nearly 30 percent.

    In the same period, Tien Phong Plastics also doubled their revenue and had its gross margin rise to almost 36 percent.

    Both companies were able to achieve this growth thanks to cheap materials and continual expansion.

    But as investors started to lose faith in the potential of the plastic industry and the entrance of foreign companies along with higher material costs, the plastic manufacturers had to reduce their profit margins.

    Last year, Binh Minh Plastic’s gross margin dropped to below 23 percent, while that of Tien Phong Plastic fell to 33 percent.

    Other stocks in the country have also fallen. The HNX-Index on the Hanoi Stock Exchange on Friday closed at 104.271 points, down 24.4 percent from its peak in April.

    The UPCoM-Index for unlisted companies on Friday closed at 51.872 points, 16 percent lower from its peak in March.

    Lees ook:

    Lees ook:

  • Korea’s manufacturing and mining shipments up 7 percent

    Korea’s manufacturing and mining shipments up 7 percent

    Korea’s manufacturing and mining industry shipments increased in 2017, mainly due to growth in the electronics, refined petroleum and machinery sectors, a government report showed on Tuesday. Combined shipments by companies in the sectors with more than 10 employees reached 1,516 trillion won ($1.34 trillion), up 7 percent, or 99.7 trillion won, from the year before.

    The increase is attributable to a 14.6 percent year-on-year rise in electronics shipments and a 26.6 percent gain in shipments from local refined petroleum businesses during the one-year period, the agency said. The machinery sector posted a 19 percent year-on-year rise last year.

    Such gains offset losses in the shipbuilding and automaking sectors, it said.

    The report also said that the average shipments for manufacturing companies stood at 21.7 billion won last year, up 6 percent from 2016.

    It said value-added product deliveries by mining and manufacturing companies rose 8.1 percent, or 41 trillion won, in 2017 to over 547.7 trillion won.

    As of the end of 2017, there were 69,790 mining and manufacturing companies in the country employing 2.96 million people. This represents a slight fall from the year before.

  • Hana Bank reveals Vietnam expansion plan

    Hana Bank reveals Vietnam expansion plan

    South Korean banks are setting themselves up to score big in Vietnam as foreign ownership limits would be loosened. South Korea’s second-largest lender by assets, KEB Hana Bank, is interested in buying a 17.65 percent stake in the Bank for Investment and Development of Vietnam (BIDV), a source said. BIDV is currently the second-largest state-owned lender in Vietnam by assets. 95.28 percent of its equity belongs to the country’s central bank, the State Bank of Vietnam (SBV).

    The SBV has “proposed to sell” the stake to KEB Hana for 30 billion won ($26.6 million), said the source, who requested anonymity.

    Last year, Shinhan Bank, a commercial banking unit under Seoul-based Shinhan Financial Group, acquired ANZ Vietnam’s retail unit, bringing along the Australian bank’s 95,000 credit card customers.

    Shinhan Bank has recently become the largest foreign bank in Vietnam with $3.3 billion in assets, surpassing HSBC.

    Vietnam presented a draft securities law in Hanoi earlier this month that would remove the current 49 percent foreign ownership cap in many sectors, allowing majority or even 100 percent ownership of a company.

    Although the limit for banks remains at 30 percent, government economic advisor Can Van Luc said at the draft presentation forum on November 7 that authorities would consider raising this limit for banks on a case-by-case basis, Reuters reported.

    Analysts say Vietnam’s growth potential and deregulation plans make it an attractive market for South Korean banks.

    “Vietnam is the most desirable market among emerging countries,” said Seo Young-soo, an analyst at Kiwoom Securities.

    “It has more advanced urbanization, and its market is more concentrated compared to Indonesia. Its government-driven economic development model is also familiar to South Korean banks, which have grown under the same strategy,” Seo said.

    Data from the Seoul-based regulator Financial Supervisory Service (FSS) show that total assets held by South Korean banks in Vietnam increased 18.9 percent last year to $5.7 billion.

    This ratio is higher than that of foreign lenders overall, whose combined total assets increased 12.9 percent to $42 billion during the same period, FSS said. South Korean lenders’ combined net profit in Vietnam also jumped 28.9 percent last year to $61 million.

    Vietnam has nine wholly-owned foreign banks, four state-owned banks and 31 domestic joint-stock banks.

    Lees ook:

  • China could use Vietnam to avoid US tariffs: experts

    China could use Vietnam to avoid US tariffs: experts

    Experts said the U.S.-China trade war puts Vietnam at risk of fraud as capital moves into the country to avoid U.S. sanctions. Vietnamese products would face tough competition from China in both the domestic and overseas markets, Nguyen Thi Thu Trang, director of the Vietnam Chamber of Commerce and Industry’s (VCCI) WTO Center, said at a recent conference on the impact of the Sino-American trade spat.

    In the domestic market, China might seek to dump its goods on Vietnam to avoid Donald Trump’s tariffs. Cheaper Chinese goods competing with Vietnamese goods will not benefit Vietnam’s economy.

    In overseas market, China might borrow the “made in Vietnam” label to dodge U.S. tariffs.

    If this cannot be controlled, there could be grave consequences for Vietnamese firms since the U.S. might apply the same tariffs as they have done on China, according to industry insiders.

    Ho Duc Lam, chairman of the Vietnam Plastics Association, said his industry has been impacted by having to compete directly with Chinese companies as China might borrow the “made in Vietnam” label to dodge U.S. tariffs.

    Tran Dinh Thien, an economist and member of the Prime Minister’s Economic Advisory Group, noted that the trade war brings both opportunities and challenges for Vietnam, but it is up to local companies to identify the opportunities.

    He said the trade war has hit investors’ confidence causing them to pull out of emerging markets including Vietnam. The global supply chain is badly disrupted as a result, and the investment environment has become uncertain, he said.

    Lam argued that to protect domestic companies the government should consider import taxes if there are signs of a safeguard action.

    It should not issue licenses if there is no guarantee that more than two thirds of the production chain would be in Vietnam, and should promote free trade agreements with Europe and others to reduce Vietnam’s dependence on the U.S. and China, he added.

    Trang of the VCCI said since the trade war shows no signs of ending soon production enterprises should monitor the situation to respond nimbly to changes and should know where and how to take advantage of potential opportunities.

    It is known which goods face sanctions, so businesses should research about customers for those goods and offer them a better deal, she said.

    The U.S.-China trade war escalated in September with the U.S. levying an additional 10 percent tariff on about $200 billion worth of Chinese products. Washington is set to raise the tariffs to 25 percent in January if there is no agreement between the both sides.

    China retaliated with 5 and 10 percent tariffs on $60 billion worth of U.S. products.

    Lees ook:

  • Vietnam ratifies Trans-Pacific Partnership

    Vietnam ratifies Trans-Pacific Partnership

    Solidifying its commitment to the Trans-Pacific Partnership that was redrafted and signed in March, Vietnam is the latest member nation to ratify the trade agreement. Vietnam’s lawmaking body approved the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) on November 12, following Australia’s ratification on October 31.

    Other countries to have now ratified the deal include Japan, Canada, Mexico, Singapore and New Zealand, taking the member count to seven.

    Originally a 12-country trade deal, the CPTPP – also known as TPP-11 – had to be redesigned in March to facilitate 11 members, after US president Donald Trump pulled Washington out of the deal shortly after taking office in early 2017.

    At its first creation, the CPTPP represented some 30% of global trade, but without the US, that figure has dropped to 13%. Still, it is expected to reduce tariffs between the 11 participating nations that together add up to US$10 trillion.

    As for Vietnam, the deal comes at a time when the Southeast Asian nation looks to rid its dependency on its two major trading partners – the US and China, amid the recent tensions between the two.

    Some 25% of Vietnam’s total trade is with China, which is is in a tariff battle on all of its exports to the US.

    The new CPTPP gives Vietnam the chance to limit its reliance on China for things such as yarns and textiles for its garment industry, meaning it will source from member countries to receive tariff-free components.

    “This is an important political decision, affirming our country’s active role in international integration,” Nguyen Van Giau, head of the National Assembly’s external relations department said this week.

    Up close, the deal sees taxes on nearly 43% of Vietnam’s apparel exports to Canada removed immediately after the agreement takes effect, and 100 percent after four years, the government said.

    The garment sector is Vietnam’s second largest export-earner after smartphones, while footwear products and seafood will also benefit.

    The pact, which includes specific requirements on labour rights and conditions of work, is also expected to help Vietnam advance in labour reforms, the International Labour Organization said.

    Brunei, Chile, Malaysia and Peru are the four remaining members yet to ratify the pact.

    Lees ook:

    Lees ook:

  • Bursa slips on Wall Street, oil price slump

    Bursa slips on Wall Street, oil price slump

    Bursa Malaysia was not spared the fallout from this week’s rout on Wall Street and the slump in crude oil prices, with the FBM KLCI sliding 15.34 points to close at 1,695.37 points today. Most sectoral indices on the local bourse ended in the red today, save those for construction, healthcare, utilities and the ACE Market, and the FBM Fledgling Index.

    The selloff on Wall Street has been led by technology stocks, and the New York stock market’s gains for 2018 have been wiped out with the latest plunge on Tuesday.

    The Dow Jones Industrial Average and the S&P 500 ended at their weakest since late October on Tuesday, diving 553 points or 2.2 % and 49 points or 1.8 % respectively. The technology-heavy Nasdaq declined 117 points or 1.7 %, the lowest it has hit in seven months.

    Energy stocks also took a beating after crude oil prices slumped 6.6%.

    Rakuten Trade Sdn Bhd head of research Kenny Yee said that the performance of the local bourse is attributable to developments on Wall Street and the decline in crude oil prices – which will be used as the “relevant excuse” by investors to take profits given the recent climb in stock prices.

    Asked if the selling will persist, he said this will depend on Wall Street’s performance.

    Yee projects the FBM KLCI to trade around the 1,680 level, which he said is a well-supported position.

    He noted that selling could also be induced by the expected dip in third quarter corporate earnings, in which further downgrades on corporate earnings growth are expected.

    “We were deep into the tech bubble and now it is bursting. The bubble is not totally without fundamentals but prices rose too much over a long period of time. For the US, it is only starting and for Malaysia the oil price drop marked our peak. We were just trying to recover before the bursting of this bubble hit us,” explained Inter-Pacific Securities Sdn Bhd head of research Pong Teng Siew.

    “There is no cover currently. All asset classes are being hit. Bonds, stocks, commodities, properties, cryptocurrencies … all are being hit. Even gold is going nowhere,” he said.

    Asked if this will continue, Pong noted that the market does look like continuing its bearish streak in all asset classes as the tide of liquidity is flowing out at the moment.

    Sapura Energy was the most active counter on Bursa Malaysia yesterday, surging 4.17% to 37.5 sen with 87.49 million shares traded.

    Malaysian Pacific Industries was the top loser, falling 4.08% to RM11.74 on volume of 480,600 shares.

  • Foreign flows into Asian bonds turn positive, Malaysia leads

    Foreign flows into Asian bonds turn positive, Malaysia leads

    Foreign flows into Asian bonds turned positive in October, in stark contrast to the sharp outflows faced by equity markets due to slowing earnings and concerns over trade. Data from central banks and bond market associations showed overseas investors bought a net US$2.24 billion (RM9.4 billion) in Malaysian, Thai, Indonesian, South Korean and Indian bonds in the last month. That compared with net outflows of US$2.46 billion in September.

    Malaysia’s bond market led the region with inflows of US$1.8 billion in October, the highest in 2018. At the end of last month, foreign ownership of Malaysian government securities rose to 40.7% from 39.5% in September, the data showed.

    Thailand and Indonesian bond markets also attracted foreign money of US$1.07 billion and US$886 million, respectively.

    “Thailand’s large current account surplus and growth recovery have boosted the perception of Thai debt as a relative safe haven in the region,” said Khoon Goh, Singapore-based head of Asia research for ANZ Banking Group in a note.

    Lees ook:

  • UOB: Malaysia’s GDP to grow at 4.8% for 2018, 2019

    UOB: Malaysia’s GDP to grow at 4.8% for 2018, 2019

    Malaysia’s gross domestic product (GDP) growth is expected to remain stable and expand at 4.8% for the full year of 2018 and 2019. UOB Malaysia’s senior economist, Julia Goh said the 2019 forecast has been revised from the 5% projection made earlier, to 4.8% after taking into account the potential impacts from the US-China trade tensions.

    Goh noted that while Malaysia’s economy is not immune to external headwinds such as the trade tensions between the two economic giants, rising US interest rates and commodity prices—Malaysia could certainly find support from its robust domestic private consumption and investment.

    The ringgit is expected to stand at RM4.22 against the Greenback next year on the back of external factors such as the strength of the dollar, crude oil prices and the direction of the renminbi.

    Inflation rate for 2018 is expected to be 1.2% and 2% in 2019.

    “I think it is actually slightly lower than the government’s official forecast. I think the main support for inflation is we are seeing resilient spending even with the reintroduction of the Sales and Service Tax, we did not see any significant effect on the consumer price index,” she said.

    Key risk for inflation I think (will be) in the second quarter of next year where the government announced that they want to float oil prices,” she added.

    Lees ook:

  • Most SE Asia stocks fall in line with broader Asia; Indonesia climbs 1 pct

    Most SE Asia stocks fall in line with broader Asia; Indonesia climbs 1 pct

    Most Southeast Asian stock markets fell on Tuesday, tracking broader Asia after a selloff on Wall Street overnight. As reported, citing sources from both sides, that China’s top trade negotiator Liu He may visit Washington to prepare for the talks between U.S. President Donald Trump and his Chinese counterpart Xi Jinping on the sidelines of the G20 summit in Argentina later this month.

    Philippine shares declined 1.2 percent, extending falls into a third session, dragged by industrial and real estate stocks. SM Prime Holdings declined 2.3 percent, while JG Summit Holdings fell 6.9 percent.

    Singapore shares declined for a third consecutive session, dragged by financials. DBS Group Holdings, the city-state’s largest lender, slipped 0.9 percent, while rival United Overseas Bank Ltd fell 1.2 percent.

    Malaysian shares extended falls into a third session, with IOI Corp Bhd shedding 3.1 percent to a near 11-month closing low and IHH Healthcare Bhd declining 2.8 percent to its lowest close since July 2014.

    Trade tensions between the United States and China will create a “domino effect” and prompt other countries to turn protectionist, said Malaysian Prime Minister Mahathir Mohamad.

    Vietnam shares declined 1.4 percent, dragged by financial and real estate stocks. Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) fell 3.7 percent, while real estate investor Vingroup JSC ended 2.7 percent lower.

    Indonesian shares were the top gainers in Southeast Asia with a rise of 1 percent. Consumer staples and financials led the gains with United Tractors Tbk PT and Bank Central Asia Tbk PT rising 5.5 percent and 1.6 percent respectively.

    Thai shares climbed 0.3 percent, helped by consumer staples.

    Glass container manufacturer Berli Jucker PCL rose 1.4 percent, while convenience stores operator CP All PCL climbed 2.6 percent to a more than one-month closing high.

    “Stocks are rising on internal factors like government improving infrastructure and linking of our three airports,” said Teerada Charnyingyong, an analyst with Phillip Capital Thailand.”The government also announced measures to stimulate spending by promoting the tourism sector.”

  • Maybank Asset Management sees AUM expanding US$50m in next 2 years

    Maybank Asset Management sees AUM expanding US$50m in next 2 years

    Maybank Asset Management Group (MAMG) expects its assets under management (AUM) to increase between US$30 million (RM126 million) to US$50 million (RM209 million) in the next two years, following its collaboration with Schroder Investment Management (Singapore) Ltd to co-develop investment solutions for sophisticated investors.

    As of end September 2018, MAMG’s AUM stood at RM33.7 billion.

    MAMG and Schroders Singapore announced their first long-term strategic partnership with the launch of two discretionary portfolios, namely Global High Dividend Equity Portfolio and Global High Conviction Portfolio.

    These solutions will be managed by Maybank Asset Management (MAM) Malaysia, a unit of MAMG, with Schroders Singapore as the investment adviser.

    “This is a very targeted high net worth segment so we are leveraging on Maybank private banking customers,” MAMG CEO Badrul Hisyam said.

    “The (market) sentiment right now is quite weak generally, unless the sentiment improves, then we would see better response to this kind of product,” Badrul added, revealing that at least three more products would be available under this collaboration in financial year 2019.

    “By integrating our strength in local wealth management with their global investment capabilities, the resulting synergy will allow us to deepen our foothold in the Malaysian wealth market, through dedicated offerings designed to achieve investors’ desired outcomes.

    “We recognise the growing demand for sophisticated, outcome-oriented global investment solutions, particularly among the high net worth community. We are therefore committed to delivering a range of global investment strategies to cater to their evolving financial needs,” he noted.

    Meanwhile, Schroders Singapore country head Susan Soh said as part of the continuing partnership, both companies would undertake further collaboration projects to co-develop solutions across other asset classes, including Shariah-compliant investment and private assets.

    “We believe our ability to combine the key tenets of asset management and wealth management offers differentiated value proposition to MAM Malaysia’s clients,“ Soh said.

    According to Badrul, the Shariah-compliant investment is expected to be available to the market by third quarter of 2019.

    Lees ook:

    Lees ook:

  • Vietnam ratifies Asia-Pacific trade pact

    Vietnam ratifies Asia-Pacific trade pact

    Vietnam became the seventh country to ratify the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) Monday afternoon. With its ratification, the National Assembly (NA) has assigned the task of reviewing related bills and legal enactments to the Government, the Supreme People’s Court, the Supreme People’s Procuracy and other relevant bodies.

    Once reviewed, the government agencies shall request that competent authorities amend, supplement or enact new laws in a timely manner to ensure uniformity and adherence to the roadmap for implementing commitments contained in the CPTPP.

    The Prime Minister will be responsible for approving and directing the relevant central or local agencies in implementing the CPTPP pact.

    The CPTPP is a major trade pact between Vietnam and 10 other countries that seeks to boost trade by reducing tariffs.

    Speaking at a recent NA session, Deputy Prime Minister Pham Binh Minh said that the CPTPP “will benefit Vietnam overall.”

    Because the trade pact will cover 13.5 percent of global GDP, Vietnam’s GDP will be able to grow by 1.32 percent, and its exports 4.04 percent by 2035, he added, citing a report by the Ministry of Planning and Investment.

    However, the Deputy PM also enumerated challenges that Vietnam would face when joining the CPTPP.

    Domestic products such as pork and chicken might face strong competition from imported products. Other products that can have trouble competing include paper, steel and cars, Minh said.

    The other six countries to ratify the pact are Australia, New Zealand, Canada, Japan, Mexico and Singapore.

    The four countries still to ratify it are Brunei, Chile, Malaysia and Peru.

    Originally a 12-member agreement known as the Trans-Pacific Partnership (TPP), the pact was thrown into limbo when U.S. President Donald Trump withdrew his country from the deal in January 2017.

    Following the U.S. withdrawal, the remaining 11 countries renegotiated parts of the TPP, removing some of Washington’s demands. In March, they signed the revised CPTPP, also known as TPP-11.

    Lees ook:

  • Bank of Indonesia Signs $10b Financial Stability Deal With Singapore

    Bank of Indonesia Signs $10b Financial Stability Deal With Singapore

    The central banks of Indonesia and Singapore said last week that they had agreed to a bilateral deal for a $10 billion backstop to help maintain monetary and financial stability after a recent bout of turbulence in markets. The pact, which will be in place for one year, comprises a local currency swap agreement of around $7 billion equivalent and another $3 billion that allows for repurchase transactions between the two central banks to obtain United States dollar cash using government bonds of major countries as collateral.

    Bank Indonesia has been recently intervening to stabilize its rupiah, which fell to 20-year lows against the US dollar amid a global rout in emerging markets.

    “Economic fundamentals in the regional economies remain sound. But markets can sometimes overreact in the face of heightened uncertainty. This bilateral financial arrangement will instill confidence amongst investors,” said Ravi Menon, managing director of the Monetary Authority of Singapore.

  • Indonesia’s Third-Quarter GDP Growth Slows as Consumer, Export Sectors Struggle

    Indonesia’s Third-Quarter GDP Growth Slows as Consumer, Export Sectors Struggle

    Indonesia’s economic growth slowed in the third quarter, losing momentum from the previous three months and pointing to tougher conditions for Southeast Asia’s biggest economy, which has struggled with capital outflows and weaker exports and household spending.

    Gross domestic product expanded 5.17 percent in the July-September quarter from a year earlier, the Central Statistics Agency (BPS) said on Monday, compared with a 5.15 percent expansion expected in a Reuters poll and the second quarter’s 5.27 percent. The April-June quarter pace was the fastest since late 2013.

    The slowdown was largely due to softer household consumption in the third quarter and a negative contribution from foreign trade.

    Although the expansion was a notch faster than expected, economists warn growth may weaken further.

    “We think growth will tend to be slower in the coming future due to the impact of weakening rupiah,” said Fakhrul Fulvian, a Jakarta-based chief economist of Trimegah Securities. He expects GDP to grow 5.13 percent in 2018 and 5 percent in 2019.

    The rupiah is down around 9 percent this year, making it the second-worst performing currency among emerging Asian markets.

    Though a weaker currency has not stoked inflation, the central bank has raised interest rates five times since May to slow capital outflows in a measure analysts say could dampen domestic demand.

    Alex Holmes, Asia analyst at Capital Economics, said growth will probably stay around 5 percent over the next couple of years.

    “A key drag on growth over the next year is likely to be the export sector,” Holmes said in a note, adding that weaker global growth and subdued commodity prices could hold back export revenues.

    Weaker coal and palm oil prices have been a drag on Indonesia’s exports, with the fall in the local currency unable to offset the hit to revenues from the softer commodity prices.

    The export sector’s contribution to GDP in the third quarter was wiped out by imports. BPS chief Suhariyanto blamed this on declining non-oil and gas commodity prices as well as slower growth in main trading partners like China and Singapore.

    Stronger investment and government spending also failed to mitigate slowing household consumption, which accounts for more than half of Indonesia’s GDP.

    While a trade war between the United States and China is expected to hurt economic growth in the region, most analysts say Indonesia, which is less integrated into global production supply chains than its regional peers, will not be among the worst hit.

    However, the trade war could pressure the Indonesian economy through its financial markets.

    In addition to Bank Indonesia’s rate hikes, the government has delayed infrastructure projects and raised tariffs for a wide range of consumer goods, which could further hurt growth.

    Barclays economist Rahul Bajoria said tighter fiscal policy next year also clouds growth outlook.

    While the government’s official GDP growth target this year is 5.4 percent, Finance Minister Sri Mulyani Indrawati last month told the House of Representatives that 2018 growth was more likely to be 5.14 percent.

    The government projects growth at 5.3 percent for next year.

    Bank Mandiri economist Andry Asmoro said the third-quarter growth figures were unlikely to affect the central bank’s monetary stance.

    “The global challenge is still huge and prioritizing stability over growth remains relevant in the current environment,” he said.

    Lees ook: