23 December 2008 Newz Bits

December 23, 2008 at 3:27 am Leave a comment


On Malaysia
· Air Asia and Jetstar in merger talks?
· MMC’s plan to sell part of Tanjung Pelepas port hits a snag
On The Global Front
· China cuts rates again, fifth time since mid-September
· Thailand’s exports contract for first time in six years

Something may be in the air between Qantas Airways Ltd and AirAsia Bhd (AIRA MK, Buy, TP:RM1.90). If things work out, a merger between AirAsia and the Australian carrier’s units Jetstar and JetstarAsia may be in the offing. The talks are still in preliminary stages and it is learnt that AirAsia’s boss Datuk Seri Tony Fernandes and Qantas new chief executive officer
Alan Joyce have been mulling over it. They last talked on the issue last week, a source said. This comes at a time when Malaysia Airlines (MAS) (MAS MK, Rating under review) is also in talks with Qantas for a possible alliance, but any alliance between Qantas and MAS will be between the network airlines. Last week Qantas and British Airways announced the calling off of plans to merge into a mega carrier after failing to agree on key terms. The merger could have created an A$8bn plus carrier by market value with a fleet of about 500 planes. Fernandes, when contacted yesterday, told StarBiz that “we are always talking and looking at ways to strengthen AirAsia into a global brand. If there are opportunities of equals which will enhance the brand, then it is something worth considering.’’ He declined to comment further. Qantas’ Joyce was not immediately available for comment. (The Star)
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Property developer Ekovest Bhd has submitted tenders for projects worth RM3bn to RM5bn in Malaysia, according to executive vice-chairman Datuk Lim Kang Hoo. “Most of the tenders are for government-related projects,” he told reporters after the company’s AGM yesterday. Ekovest has an order book worth RM600m, including the new phase of Universiti Malaysia Sabah and two contracts with Kolej Universiti Institut Teknologi Tun Hussein Onn. Lim said the ongoing projects were expected to sustain the group’s operations for three years. On overseas projects, he said the company was already in talks with potential joint-venture parties for property development in Vietnam and Indonesia. (The Star)
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Tan Sri Syed Mokhtar Albukhary’s plan to hive off a block of shares in Port of Tanjung Pelepas (PTP) has hit a snag, sources said. An initial proposal by his flagship MMC Corporation Bhd, which owns 70% of PTP, to divest a 20% stake of the port to the Employees Provident Fund (EPF) is said to be rejected by the pension fund’s board. It is said that EPF’s investment committee was deterred by the price tag. Syed Mokhtar is said to have valued PTP at about RM8bn and wanted RM1.6bn for a fifth of the equity in the port. (FinancialDaily)
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Oil palm futures in Kuala Lumpur gained for the first time in three days after Malaysian exports advanced in the first three weeks of the month, stoking speculation that record stockpiles could decline. Palm oil shipments from Malaysia jumped 31% in the last 20 days of the month to 1.1m tonnes compared to the same period the previous month. (FinancialDaily)
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Former deputy governor of Bank Negara Malaysia Tan Sri Dr Lin See Yan said there was an urgent need for Asian economies to take coordinated actions to protect their economic growth as the recession in the United States and parts of Europe was likely to be severe and prolonged. He said there was a need for measures aimed at ensuring coordinated macroeconomic expansion among Asean and Asean+3 countries comprising Japan, China and South Korea. The policies should include monetary, fiscal and exchange rate actions, he said. (FinancialDaily)
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The international reserves of Bank Negara Malaysia totalled RM330.4bn as at December 15 2008. The reserves position is sufficient to finance 7.8 months of retained imports and is 3.4 times the short-term external debt. (BT)
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Stocks fell Monday in a thinly traded session amid concerns about 4Q corporate earnings, falling oil prices and ongoing woes in the auto industry. The Dow Jones industrial average fell 59.42 points, or 0.7% to close at 8,519.69 according to early tallies. The Standard & Poor’s 500 index dipped 1.8% (-16.25 pts, close 871.63) and the Nasdaq composite lost 2% (-31.97 pts, close 1,532.35). In currency trading, the dollar rose against the pound and yen, but remained flat against the euro. U.S. crude fell $2.45 to settle at $39.91 a barrel on the first weekday of trading for the February 2009 contract. (CNNMoney)
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China trimmed interest rates yesterday as the latest step in a campaign to fend off a deepening economic slowdown, though the cut, the fifth since mid-September, was smaller than many analysts had counted on. The People’s Bank of China cut benchmark one-year lending and deposit rates by 27 basis points (bps) – to 5.31% and 2.25% respectively – a far cry from its last move slashing rates by 1.08 percentage points at the end of November. The Chinese central bank also lowered the amount of money that commercial lenders must keep on deposit with it, cutting the required reserve ratio by half a percentage point, which economists said could free up to 300bn yuan (RM152.38bn) of extra credit. (Financial Daily)
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China’s foreign exchange reserves, the world’s largest stockpile, shrank in October to less than US$1.89trn, their first monthly fall since December 2003, a source familiar with the situation said yesterday. The reserves stood at US$1.906trn at the end of September, the last date for which official figures have been reported, meaning they fell by at least US$16bn during October. The source, who wished not to be identified, declined to say whether the reserves continued to fall in November. Cai Qiusheng, an official with the State Administration of Foreign Exchange, acknowledged in a speech on Saturday that the reserves had fallen from their level above US$1.9trn, but gave no further details on the extent or timing of the fall. (Reuters)
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Japan’s woes from the global crisis deepened yesterday as data showed a record drop in exports and the government said for the first time in nearly seven years that the economy was getting worse. Japan reported a trade deficit of 223.4bn yen (US$2.5bn) in November as exports fell at their fastest-ever rate, according to figures from the finance ministry. (AFP)
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Thailand’s exports in November contracted for the first time in more than six years as overseas demand waned amid a global recession. Shipments fell 18.6% from a year earlier to US$11.87bn, Permanent Secretary for Commerce Siripol Yodmuangcharoen said in Bangkok yesterday. It’s the first decline since March 2002 and compares with growth of 5.2% in October. (Financial Daily)
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December 22, 2008 Daily Highlights 24 December 2008 Newz Bits

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