2 January 2009 Newz Bits

January 6, 2009 at 6:28 am Leave a comment

HIGHLIGHTS

On Malaysia
· Mobile crane owners reduce rental rates
· Bank Negara says that local banks not tightening credit
· EPF may bid for Menara Citibank
On The Global Front
· Stocks on Wall street rallied on Wednesday
· India’s export fall for 2nd straight month
REPORTS
· Kim Loong – 3QFY09 Results (Buy; TP: RM1.70)

Effective yesterday, mobile crane owners have reduced the rental rates of their vehicles by 5% in an effort to help the construction industry. Malaysia Mobile Crane Owners Association president Lai Keng Guan said the reduction was a temporary measure to help contractors mitigate the effects of the current economic slowdown. It also wanted to assist the Government to lower construction costs. “When the economy recovers, the original rental rates will be reinstated,” he told StarBiz yesterday, pointing out that the association’s members were cutting rental rates although their business was hit badly as well. (StarBiz)
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The Employees Provident Fund (EPF) may bid for Menara Citibank, a prominent building in the heart of Kuala Lumpur, as it feels that now is the time to increase its property collection. “We are enquiring … I can consider (bidding),” Johari Abdul Muid, deputy chief executive officer of investment, told Business Times and Berita Harian in an interview recently. Menara Citibank, a
50-storey building that is almost fully occupied, is up for sale again after IOI Corp Bhd called off its purchase that was priced at RM586.73m. Menara Citibank has a net lettable area of 733,626 sq ft and 99% occupancy rate. The net book value (NBV) of the building as of December 31 2007 is RM458m and the gross rental revenue is RM43.3m (excluding revenue from the car park of RM3.3m). (BT)
* * * * *
Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz says its surveillance indicates that Malaysian banks are not tightening credit. Lending by local banks remained strong last year, but lenders have been told to balance the need to be careful with loans with continued support of viable businesses, Tan Sri Dr Zeti Akhtar Aziz said. “There has been a growth in lending of 8-10% across the board; household, small- and medium-sized businesses and outstanding loans have increased,” Zeti said in an interview with Business Times. The industry has the capacity to  provide access to lending because domestic banks have experienced high profits for an extended period of time, are well capitalised and have less bad loans. (BT)
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Stocks rallied Wednesday, as investors welcomed the end of an abysmal year on Wall Street and looked forward to a better year ahead. All financial markets are closed Thursday for New Year’s Day. The DJIA rose 108 points (+1.2%, close 8,776.4 pts). The S&P 500 gained 1.4% (+12.6 pts, close 903.3) and the Nasdaq composite advanced 1.7% (+26.3 pts, close 1,577.0). In currency trading, the dollar fell versus the euro and the yen. US light crude oil for February delivery rose US$1.82 to settle at US$40.85 a barrel on the New York Mercantile Exchange. (CNNMoney)
* * * * *
The US Treasury threw the door open to taxpayer financing for a widening array of companies and industries by drafting broad guidelines on aid to the auto industry. The Treasury’s guidelines, published Wednesday, would let officials provide funds to any company they deem important to making or financing cars. That leaves room for the government to provide money from the Troubled Asset Relief Program beyond loans already committed to General Motors Corp, GMAC LLC and Chrysler LLC. (Bloomberg)
* * * * *
India’s exports fell for the 2nd straight month, adding pressure on the central bank to cut interest rates and support growth in Asia’s third-largest economy. The Reserve Bank of India, which has reversed four years of monetary tightening in the past three months, has room to slash rates further after a report yesterday showed inflation slowed to a 10-month low. Lower borrowing costs will spur consumer demand among the nation’s 1.2bn people and compensate for falling orders from recession-hit U.S. and Europe, India’s biggest markets. (Bloomberg)
* * * * *
Australian manufacturing contracted for a 7th month in December as global financial turmoil prompted companies to reduce production. The performance of manufacturing index rose 1 point to 33.7 from November, when it hit the lowest level since the index was started in 1992, the Australian Industry Group and PricewaterhouseCoopers said in a report released in Canberra today. A reading below 50 signals manufacturing is shrinking. The contraction in manufacturing supports evidence that Australia’s economy is slowing and may allow central bank Governor Glenn Stevens to add to the most aggressive round of interest-rate cuts since 1992 when he next reviews the benchmark interest rate on February 3. (Bloomberg)
* * * * *
Indonesia’s economy may have expanded 6.2% y-o-y in 2008, even as growth slowed in the second half, the Finance Ministry said. Inflation was 11.4% last year, higher than targeted, while the budget deficit was lower at 4.2trn rupiah (US$378m), the ministry said in a statement yesterday. In its latest 2008 budget, the government forecast 6.4% economic growth, driven by consumption and commodity exports. (Bloomberg)
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31 December 2008 Newz Bits Kim Loong Resources 3QFY09 : Bad news in the price

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