FBMKLCI
1710.93pts +5.84pts
(+0.34%) Volume 2.419b Value RM 2.005b
1) The KLCI traded in positive territory thruout the day
to close 5pts higher as investors await the announcement of the Malaysian
Budget 2016. Region rebounded inline
with the global market after EU president, Draghi, hints at more QE and better
U.S earnings boosted sentiments, NIKKEI +2.11%, HSI +1.34%, SHCOMP +1.30%,
HSCEI +1.34%, ASX +1.67%, STI +1.00%. PLANTATION +1.24% index gained the most
grounds as worsening elnino effect drew attention to heavyweights, KLK +2.10%,
GENP +3.07%, FGV +2.85%. Market breadth was positive with gainers beating losers
by 525 : 318. Market futures closed at 1714 (3pts premium).
2) Heavyweights : TENAGA +0.62% RM12.80, KLK +2.10%
RM23.32, PETGAS +1.11% RM23.60, GENM +1.38% RM4.40, YTL +1.98% RM1.54, PCHEM
+0.87% RM6.46, SIME +0.46% RM8.59, BAT +1.385 RM62.98.
3) DBT : IDEAL 9mil @ RM0.40, BIOHLDG 8.83mil @ RM0.29,
OLYMPIA 6.7mil @ RM0.10
4) Situational:-
TM -0.29% RM6.81 - Telekom Malaysia Bhd (TM) today signed
a memorandum of understanding (MoU) with Swiss Garden Resort Residences, Sungai
Karang on the provision of high-speed broadband service. The Mou would enable
the hotel to provide hospitality entertainment solutions, including HyppTV and
support services.
5) BUDGET 2016 :
Following are some of the highlights of the 2015/2016, Economic Report
issued by the Finance Ministry in conjunction with the tabling of the 2016
Budget by Prime Minister Datuk Seri Najib :
* GST to rake
in RM39 billion in 2016 (3.1% of GDP) (2015: ests RM27 billion from April) ,
representing a *44% increament
* Malaysia's
GDP to remain on a steady growth in 2016, to expand between 4.0% to 5.0%
(2015:4.5-5.5 pct)
* Growth in
Malaysian economy to be driven by domestic demand with private expenditure to
remain the main anchor
* Malaysia's fiscal deficit is projected to
decline to RM38.8 billion or 3.1% of GDP in 2016 (2015: 3.2%)
* Federal gov rev collection in 2016 to grow
marginally by 1.4% to RM225.7bn - due to higher collection of tax revenue
* Oil-related revenue to drop 14.1% in 2016 due
to lower global crude oil prices (2015: 19.7 pct)
* The Federal gov expenditure to increase 1.7%
to RM265.2bn in 2016 (2015: RM260.7bn)
* Of the RM265.2bn Federal gov expenditure,
81.1% allocated for opex while 18.9% for development expenditure.
* Opex in 2016 to increase marginally by 0.9%
following continuous efforts to rationalise and optimise government spending
* The dev exp is expected to +5.4% in 2016
which RM30.3bn would go to the economic sector
* The security sector would be provided RM5bn
in 2016 to enhance the capability of the armed forces and police
* Public
investment to record a higher growth of 2.3% in 2016 from 1.6% in 2015
supported by new projects under the Economic
Transformation Programme and 1MP and the ongoing projects under the 10MP
* Services sector is projected to grow 5.4% in
2016 and increase its share to 54% of GDP from 53.8% in 2015 with all
sub-sectors continuing to expand
* Inflation to remain stable at 2-3% in 2016 (2015:2.0-
2.5%)
* Nominal GNI per capita to increase 5.6% to
RM38,438 2016 from 4.2% anticipated growth to RM36,397 in 2015
* Malaysia's current account to post a surplus
in the range of 0.5% to 1.5% of GNI
compared with a surplus of 1.5-2.5% expected in 2015
* Gross exports are expected to rebound 1.4% in
2016 from a -0.7 % in 2015 supported by higher public investment and capital
spending in the manufacturing and
services sectors.
* The deficit in the services account next year
is expected to improve to RM11.4bn from RM14.7bn in 2015
* The Federal Government debt remains within
prudent limit, and is well capped at 55% to GDP, placing Malaysia among
medium-indebted countries
* The East Coast Economic Region (ECER) has
attracted RM78bn in investments since
its inception in 2007, accounting for 71% of the RM110bn target by 2020.
Other highlights
include:
* Special
Reinvestment Allowance for manufacturing and agriculture sectors for selected
existing companies
* 20 per cent
stamp duty exemption on Syariah-compliant loan instruments to finance the
purchase of houses
* Additional
RM1 billion for Syariah-compliant SME Financing System until Dec 31 2017
* RM107 million
allocated to SME Blueprint
* Establishing
a RM200 million SME Technology Transformation Fund to provide soft loans at 4
per cent
* Building and
improving rail transport network and highways
* RM900 million
allocated to implement Jalan Tun Razak Traffic Dispersal Project
* Feasibility
study on constructing a Masjid Tanah-Klebang-Jambatan Syed Abdul Aziz coastal
highway in Melaka
* RM42 million
allocation for the construction of Mukah Airport, Sarawak, and upgrading
airports in Kuantan and Kota Bharu.
* Feasibility
study for the extension of the runway in Batu Berendam Airport, Melaka
* Ampang LRT
line exntension project ready for use in March 2016, Kelana Jaya-Putra Heights
LRT extension line ready from middle of 2016
* MRT Sungai
Buloh-Semantan ready in December 2016, Semantan-Kajang to complete by mid 2017
* MRT II Sungai
Buloh-Serdang-Putrajaya will commence in second quarter of 2016, to complete by
2022
* LRT3 Bandar
Utama, Damansara-Johan Setia, Klang will commence in 2016 and expected to
complete by 2020
* The
government continues negotiations on high-speed rail with Singapore
* MCMC to
provide RM1.2 billion for rural broadband projects, National Fibre Backbone
Infrastructure, High-speed Broadband, undersea cable system
* RM250 million
to be channelled for national broadcasting digitalisation project to enhance
audio visual quality and provide value-add to TV content
* RM1.4 billion
to build and upgrade 700km rural roads nationwide
* RM878 million
for Rural Electrification Project covering 10,000 houses
* RM568 million
for Rural Water Supply Project to benefit 3,000 houses
*Initial
investment forecast of RM5 billion in 2016 for Malaysian Vision Valley
*Implementation
of Cyber City Centre in Cyberjaya with development cost of almost RM11 billion
over a five-year period
*Development of
KLIA Aeropolis expected to attract investment of RM7 billion
* The income
tax rates for resident individuals whose chargeable income from RM600,001 to
RM1 million are proposed to be increased by one per cent to 26 per cent from 25 per cent now. For those with income
exceeding RM1 million, the tax will be higher by three per cent at 28 per cent
from 25 per cent, from year of assessment 2016.
6) Market : Flattish key momentum indicators suggest lack
of buying momentum in the market. Trading range expected to remain 1680-1720
points.