(Bloomberg) Malaysian stocks dropped and the ringgit weakened after the government imposed a two-week nationwide lockdown to curb a relentless surge in Covid-19 infections.The FTSE Bursa Malaysia KLCI Index fell as much as 1.6% on Monday, before paring losses to 0.7% at the close in Kuala Lumpur. The ringgit slid as much as 0.4% to 4.1480 per dollar, while 10-year bond yields rose three basis points to 3.25%. The government said on Friday that most businesses will be shut from June 1 except for essential economic and service sectors.“The government is finally biting the bullet,” said Alexander Chia, an analyst at RHB Investment Bank Bhd. “Clearly, there are downside risks to FY21 earnings growth, even if it is essentially a postponement of growth to FY22.”Malaysia’s return to a hard lockdown comes in the wake of record daily infections that saw cases top 9,000 on Saturday. A resurgence in virus outbreaks in Asia has spurred some countries including
(Bloomberg) Malaysian stocks tumbled and the ringgit weakened after the government imposed a two-week nationwide lockdown to curb a relentless surge in Covid-19 infections.The FTSE Bursa Malaysia KLCI Index slumped as much as 1.6% on Monday, the most since March 31. The ringgit slid as much as 0.4% to 4.1480 per dollar, the biggest decline in Asia. Ten-year bond yields rose two basis points to 3.24%. The government said on Friday that most businesses will be shut from June 1 except for essential economic and service sectors.“The government is finally biting the bullet,” said Alexander Chia, an analyst at RHB Investment Bank Bhd. “Clearly, there are downside risks to FY21 earnings growth, even if it is essentially a postponement of growth to FY22.”Malaysia’s return to a hard lockdown comes in the wake of record daily infections that saw cases top 9,000 on Saturday. A resurgence in virus outbreaks in Asia has spurred some countries including Vietnam a
Sectors that the pandemic clobbered hardest such as tourism-related businesses like hotels, airlines and retailers were likely to have continued spilling red ink in 4Q20.
KUALA LUMPUR (Feb 10): Corporate earnings are expected to improve in the October-to-December quarter (4Q20). Besides the glove makers, export-oriented companies, such as electrical and electronics manufacturers, and furniture makers as well as the plantation sector are likely to be the bright spots.
MIDF Amanah Investment Bank Bhd research head Imran Yassin Yusof is expecting the growth to be circa 20% year-on-year (y-o-y), driven by the stellar performance of glove makers, citing that the sector saw earnings skyrocket following the increase in demand due to the Covid-19 pandemic.
PETALING JAYA: Despite the banking sector showing healthy signs such as a brighter outlook with higher loan growth and profitability, gross impaired loans (GIL), however, could still weigh on the sector.
How the asset quality of banks would evolve this year will depend on the duration of the current movement control order (MCO 2.0) that is implemented to curb the pandemic.
Analysts and economists are pencilling in a GIL ratio of 1.76% to 3.5% for this year.
For November last year, GIL ratio stood at 1.53% compared with 1.41% in October the same year.
For December 2019, the ratio stood at 1.53% against 1.48% in December 2018. Although these figures are still relatively manageable compared with 4.8% in December 2008, it still poses a stress on the asset quality of banks.