Friday 29 Mar 2024
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KUALA LUMPUR: Key Asian markets could continue to come under downward pressure again on Friday, July 2, as sentiment takes a dent after the weak overnight close on Wall Street amid fears of a double-dip recession.

On Wall Street, stocks fell on Thursday; the major indexes were lower for a fourth straight day after suffering their worst quarter since late 2008, but losses eased near the end of the session, according to Reuters. Investors were concerned about a major "potential depression" or deflation taking place.

The Dow Jones industrial average dropped 41.49 points, or 0.42 percent, to 9,732.53. The Standard & Poor's 500 Index shed 3.33 points, or 0.32 percent, to 1,027.38. The Nasdaq Composite Index lost 7.88 points, or 0.37 percent, to 2,101.36.

Stocks which are expected to see selling pressure on Friday, July 2 following recent corporate developments include Multi-Purpose Holdings Bhd (MPHB), Tanjong plc and Carotech Bhd.

However, the bright spot is the real estate investment trust (REITs). The impending high profile initial pubic offering (IPO) for Sunway  REIT on the Main Board of the Bursa Malaysia has certainly raised investor awareness on this particular class of investment securities, according to InsiderAsia.

Sunway REIT will make its debut on July 8. Hot on its heels, yet another REIT, the CapitaMalls Malaysia Trust is slated for listing on July 16. InsiderAsia expects the larger size and better liquidity will broaden the appeal of REITs to a wider spectrum of investors, including foreigners.

Meanwhile, MPHB says its subsidiary Magnum Corporation Sdn Bhd has received a letter from the Ministry of Finance that the pool betting duty imposed on Magnum has been increased to 8% from 6% previously.

Also affected by the higher tax rate is power to gaming company Tanjong. Its unit Pan Malaysian Pools Sdn. Bhd. was also notified by the MoF of a revision in betting duties to 8% from 6% previously.

Tanjong had said betting duties are based on gross sales proceeds after deducting gaming tax of 8%. Hence, the effective rate of betting duties will be 7.36% from 5.52% previously.

"This revision is not expected to have a material impact on the results of the Tanjong Group," it said.

The higher duties will take effect from June.

Meanwhile, Carotech Bhd said the Corporate Debt Restructuring Committee (CDRC) has accepted its application to mediate between the company and its financial creditors on its proposed debt revamp.

Carotech said the CDRC has allowed the company a period of six months to complete the scheme.

Meanwhile, Hovid, which owns 58% of Carotech, said the latter had defaulted on its principal and interest servicing in respect of certain banking facilities from financial institutions.

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