MALAYSIA: Country Wrap: Semi-Conductor Sector Still Key
Aug-20 05:25
- Malaysia’s technology sector is bracing for near-term challenges from tariffs and currency volatility, yet the country’s role as a critical node in the global semiconductor and electronics manufacturing services (EMS) supply chain is unlikely to diminish. The coming rounds of development expenditure, particularly in Penang and Johor, are expected to reinforce Malaysia’s competitiveness as multinational corporations continue to expand capacity in advanced packaging, front-end semiconductor processes and value-added EMS solutions. (source The Star)
- The number of items exempted or zero-rated under the Sales and Service Tax (SST) is nearly three times higher than under the former Goods and Services Tax (GST), the Finance Ministry (MOF) said. MOF shared that currently, 1,826 goods are exempted under SST compared to 607 items under GST, which was abolished in 2018. “The exempted list includes essential goods such as fresh food, rice, sugar, bread, milk, cooking oil, medicines, medical devices, and reading materials. It also extends to livestock feed, fertilizers, pesticides, basic construction materials and agricultural and livestock machinery,” the ministry said. On services, MOF highlighted that the SST framework currently covers about 70% of the economy, compared to 76% under GST. (source Business Today)
- After two days of gains, the FTSE Malay KLCI is down -0.31% Wednesday
- The Ringgit is weaker by -0.07% at 4.2265 having closed yesterday at 4.2235.
- MGS bond yields have sold off. The MGS 10yr is +3bp higher at 3.39%
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
LOOK AHEAD: UK Timeline of Key Events (Times BST)
Jul-21 05:23
| Date | UK | Period | Event |
| 22-Jul | 0700 | Jun | Public Sector Finances |
| 22-Jul | 1015 | ---- | BOE Bailey At TSC On FSR |
| 23-Jul | 0001 | Jun | Brightmine pay deals for whole economy |
| 24-Jul | 0930 | Jul | S&P Global Flash PMI |
| 24-Jul | 1100 | Jul | CBI Industrial Trends |
| 25-Jul | 0001 | Jul | Gfk Monthly Consumer Confidence |
| 25-Jul | 0700 | Jun | Retail Sales |
| 28-Jul | 1100 | Jul | CBI Distributive Trades |
| 29-Jul | 0001 | Jul | BRC Monthly Shop Price Index |
| 29-Jul | 0930 | Jun | BOE Lending to Individuals / M4 |
| 01-Aug | 0930 | Jul | S&P Global/ CIPS UK Final Manufacturing PMI |
| 05-Aug | 0930 | Jul | S&P Global/ CIPS UK Final Services PMI |
| 06-Aug | 0930 | Jul | S&P Global/CIPS Construction PMI |
| 07-Aug | 1200 | --- | Bank Of England Interest Rate |
| 07-Aug | 1230 | --- | BOE Press Conference |
| 07-Aug | 1400 | Jul | Decision Maker Panel data |
CHINA: Country Wrap: Scaling Back of USTs
Jul-21 05:21
- A news article from this morning indicates that a strategic move is beginning in China, that may have profound implications for the US and their fiscal position. China Daily reports that is is a 'strategic necessity' for the scaling back of holdings in US Treasuries, given the declining confidence in the dollar as the reserve global currency. The article states that China intends to pursue a more balanced, controllable allocation of FX reserves and likely to increase its holdings of non-dollar assets, including financial instruments of Asian trading partners. (source China Daily)
- Regulatory authorities in China are intensifying efforts to combat financial fraud, with a growing number of enforcement actions targeting information disclosure violations by listed companies, according to a report by the China Securities Journal Monday. Authorities are adopting a multi-pronged approach that includes penalizing both primary offenders and accomplices, while also leveraging civil penalties to strengthen deterrence: report (source BBG)
- China and Hong Kong markets are up around 0.25-0.30% so far today. The CSI 300 is building on recent positive momentum, with a weekend dam project approved aiding steel futures and iron ore prices, potentially providing some positive spill over. The index finished last week at fresh highs back to late last year. The HSI is off session highs, but still close to re-testing the 25000 level, which would be multi year highs back to 2022.
- Yuan Reference Rate at 7.1522 Per USD; Estimate 7.1786
- Bonds were slightly weaker today with the CGB 10yr +1bp at 1.67%
BOBL TECHS: (U5) Bear Threat Still Present
Jul-21 05:21
- RES 4: 118.390 High Jun 13 and a key resistance
- RES 3: 118.060 High Jun 20
- RES 2: 117.980 High Jul 4
- RES 1: 117.710 High Jul 8
- PRICE: 117.650 @ 06:02 BST Jul 21
- SUP 1: 117.200 Low Jul 11
- SUP 2: 117.009 1.236 proj of the Jun 13 - 16 - 20 price swing
- SUP 3: 117.000 Round number support
- SUP 4: 116.885 1.382 proj of the Jun 13 - 16 - 20 price swing
A bearish cycle in Bobl futures remains intact and recent gains appear corrective - for now. Recent weakness resulted in a breach of 117.530, the Jun 5 low. The break highlights a stronger reversal and cancels a recent bull theme. 117.210, a 1.000 projection of the Jun 13 - 16 - 20 price swing, has been pierced. Clearance of this level would open 117.000. Resistance to watch is 117.710, the Jul 8 high.
