This article first appeared in The Edge Malaysia Weekly on September 25, 2023 - October 1, 2023

A holiday-shortened week awaits Malaysian investors this week, as markets will be closed on Thursday in conjunction with Prophet Muhammad’s birthday. All eyes will be on Prime Minister Datuk Seri Anwar Ibrahim, who is returning from his official visit to New York on Sept 24.

The release of the Producer Price Index (PPI) for August on Sept 26 will be the focus of the economic calendar for the week ahead. The PPI declined 2.3% in July (June: -4.8%), according to the Department of Statistics Malaysia. The PPI measures the prices of goods at the factory gate.

Elsewhere in Asia-Pacific, Vietnam is likely to be the first economy in the region to release third-quarter 2023 gross domestic product (GDP) data, slated for Friday. UOB Global Economics and Markets Research expects Vietnam’s GDP to grow 5.6% year on year in 3Q2023, from 4.14% y-o-y in 2Q2023.

There is one major Asia-Pacific central bank with a monetary policy decision this week. Bank of Thailand (BoT) is set to announce its decision on Wednesday. UOB expects the bank to raise its key interest rate by 25 basis points (bps) at the September meeting. “Given the subsiding inflationary pressures and prevalent downside risks on growth, there is a chance the BoT might now leave its benchmark rate at 2.25%, after delivering a cumulative 175bps of hikes since August last year,” it said in its weekly outlook report last Friday.

“It is also worth highlighting that the BoT benchmark policy rate is 100bps above the pre-pandemic level. According to a Bloomberg survey, it is fairly split expectations, with four analysts looking for a 25bps hike to 2.5% while another four analysts expect no change at 2.25%,” UOB added.

Both Hong Kong and Thailand will announce their August trade data on Friday.

Other key data from Asia-Pacific includes releases from China’s September official manufacturing and services Purchasing Managers’ Index (PMI) on Sept 30 and China’s industrial profits for August on Sept 27. Singapore is set to release its August Consumer Price Index (CPI) data on Monday, followed by the August industrial production numbers on Tuesday and month-end bank loans and money supply data for August on Friday.

South Korea will release its September consumer confidence on Tuesday, while Australia’s August CPI data is due on Wednesday, followed by its August retail sales numbers on Thursday and private sector credit on Friday.

On the local corporate front, companies that will be holding their annual general meetings this week include NTPM Holdings Bhd (Sept 25), Microlink Solutions Bhd (Sept 26), Lingkaran Trans Kota Holdings Bhd (Sept 26), SCGM Bhd, United Malacca Bhd and SAM Engineering & Equipment (M) Bhd on Sept 27 and Genetec Technology Bhd on Sept 29.

Pelikan International Corp Bhd will be conducting a virtual extraordinary general meeting on Sept 29 to vote on the proposed disposal of its German-based stationery producer and distributor Pelikan Group GmbH to Holdham SAS for €136 million (RM695.44 million) cash. It would need at least 75% votes from shareholders for the deal to go through.

When it announced the proposed deal in June, PICB said it would use 

RM182.71 million of the RM695.44 million for working capital, settlement of liabilities, to repay bank borrowings and for estimated expenses from the proposed exercise.

Pawnbroking service provider, retailer and trader of gold and luxury products Evergreen Max Cash Capital Bhd is slated to make its debut on the ACE Market of Bursa Malaysia on Tuesday. The company saw its initial public offering oversubscribed by 53.06 times. It is raising RM64.2 million at an IPO price of 24 sen per share, which is mainly to finance the expansion of its pawnbroking business.

On the global scene, it was reported by Bloomberg that Cainiao Network Technology Co, the logistics arm of Alibaba Group Holding Ltd, plans to file for its Hong Kong IPO as soon as this week, potentially making it one of the first of the Chinese tech firm’s units to go public.

There will be no G7 central bank monetary decisions but there are plenty of G7 central bankers speaking on various platforms. On Sept 29, the US Federal Open Market Committee chair Jerome Powell will host a town hall with educators; and European Central Bank president Christine Lagarde will speak on energy transition at a Paris event.

UOB says the US Congress is unlikely to pass all the 12 appropriations bills that fund government operations by Sept 30, before the start of the new fiscal year, given the tight timeline. It says: “If some bills do gain passage, then we will likely get a partial government shutdown. The broad expectation is that it may lower US GDP growth by, say, 0.1 to 0.2 percentage points per week during that period of shutdown; but when the government reopens, it is likely to add to growth by the same amount, somewhat offsetting the effects. So, there is no real permanent economic damage.

“Of course, if the US government shuts down indefinitely, then that will make the economic costs much bigger and potentially longer lasting, but it is not a credible base case.”

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