Bursa Chat- Daily Summary

Glomac Bhd (GLMC MK, Hold, TP: RM0.62) is planning to sell several commercial property assets in Selangor, sources said. It is learnt that the company is talking to foreign funds and potential buyers from the Middle East, Pakistan, Europe, Australia and Malaysia. Sources said Glomac is looking to sell a 12-storey office tower in Glomac Business Centre for RM25m to RM30m, and a commercial block in Kelana Business Centre for RM30m. Both buildings are currently tenanted. Company source said Glomac will plough back the sales proceeds for new developments to expand its business. "Despite the gloom and doom, there are people keen to buy properties to build their investment portfolio. At a time like this, en bloc deals are more suitable. So as a developer, we will continue to look for buyers and build," the source told Business Times. (BT)

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Affin Holdings Bhd (Affin) has obtained approval in principle from Bank Negara Malaysia to commence preliminary negotiations with Felda Holdings Bhd (Felda) for the proposed acquisition of Felda’s 20% stake in BH Insurance (M) Bhd. In an announcement to Bursa Malaysia yesterday, Affin said the central bank had stated that “it has no objection in principle” for Affin and AXA Asia Pacific General Insurance to begin the negotiations with Felda. (Financial Daily)

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Pengurusan Aset Air Berhad (PAAB) only needs to secure an approval in principle from the 4 water concessionaires in Selangor to prevent the tariff from being increased at the end of this month. Thus, the takeover of the assets of the water players need not be completed by month-end, Energy, Water and Communications Minister Datuk Shaziman Abu Mansor disclosed yesterday. “Only an agreement in principle is required,” he told a media briefing here. The minister also said that PAAB has yet to make a formal offer for the water concessionaires in Selangor. (Financial Daily)

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Lembaga Tabung Haji will focus on the property and bond markets to cushion the impact of the global economic downturn. Group managing director and chief executive officer Datuk Ismee Ismail hopes to take advantage of the current weak property market as part of long-term plans to preserve the RM19.7bn savings of its 4.7m depositors. The move will help Tabung Haji maintain its position as one of the world's reputable Islamic organisations, strong in pilgrim management and investments. The state-owned manager of Muslim funds said last Wednesday that its 2008 income was hit by a weak stock market, which had fallen 40 per cent, and warned that it could be worse this year. (BT)

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Intel Malaysia, which is closing 2 of its microchip production facilities in Penang – a move which will affect over 1,000 workers – has started laying off employees at its Kulim facility which has more than 3,500 workers. Sources told that at least 16 people out of 26 employed in the department in charge of maintaining the 3 plants in Kulim were asked to leave yesterday. According to a source, the workers were not offered a voluntary separation scheme or even asked if they wanted to leave. It is learnt that more employees from other departments would also be asked to leave in the coming days and months but their number could not be ascertained. On January 21, Intel announced it was closing 2 of its 3 plants on Penang Island. (Financial Daily)

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KLCC condominium prices may fall as much as 30% as waning demand erodes sellers bargaining power to dictate prices, according to real estate consultant Rahim & Co Chartered Surveyors. This comes against the backdrop of a real estate sector down cycle in the country amid global economic slowdown which has curbed demand for local real estate among local and foreign buyers. (Financial Daily)

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Malaysia’s January exports are expected to suffer their steepest contraction in nearly 30 years, as dying demand hits an economy facing its first recession in 8 years. The country’s exports have dropped 24.8% in January from a year earlier, according to a Reuters poll of 10 economists. In December, exports fell 14.9%. (StarBiz)

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The ringgit, which fell to a 3-year low against the USD on Monday, is facing a global trend of deleveraging and repatriation of funds back to the US, said Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz. She said that the fall was not unique to Malaysia and that what was more important was that the market remained orderly. The ringgit fell to 3.725 to the dollar on Monday. (StarBiz)

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RAM Holdings Bhd has forecast Malaysia' economy to grow a marginal 0.9% this year as macro-economics fundamentals remain intact even as industrialized economies slip into recession. "Dwindling export demand, which is expected to contract 5% this year, is seen as posing the most significant downside risk to both the resilience of domestic demand and the overall buoyancy of the economy," RAM said in its "Economic Outlook" report released yesterday. Domestic demand is projected to grow 3.7% this year, down from 6.1% in 2008. This is due to waning consumer and investor confidence in the face of uncertainty as to how long the global downturn will last, the rating agency said. (BT)

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The government’s much anticipated second stimulus package could stretch its fiscal deficit to over 6% of GDP this year, said MIER. This is based on an estimated RM30bn mini-budget which will be unveiled next Tuesday. In the long run, the economic package would translate to higher debts for the government, hence, possibly, higher taxes for the man on the street as the government would need to boost income to repay its loans. The government can actually borrow domestically to finance the stimulus package as there is a lot of liquidity in the system at the moment, said RAM. The fiscal stimulus may only cushion the impact of the economic slowdown, not neutralize it. Transparency of the package is absolutely critical RAM went on to say. (Financial Daily)

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