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Borneo Bulletin, Tuesday 28 February 2017

DAILY STOCK INDICES AND SECURITIES MARKET NEWS WATCH

(27/02/17)

MAJOR STOCK INDICES

DJIA

: 20,821.76 ( +11.44 )

S&P 500 : 2,367.34 (+3.53)

HSI

: 23,925.05 (-40.65)

STI

: 3,109.02 (-8.01)

KLSE

: 1,696.13 (-2.22)

SHCOMP : 3,228.660 (-24.773)

REVIEW

Major US stock indexes spent most of Friday with declines,

before a buying spree

in the last half-hour of trading buoyed shares. The Dow Jones Industrial Average fell

as much as 76 points before closing up 11.44 points, extending its streak of records

to 11 consecutive days. It is the longest streak of records for the blue-chip index since

1987. A drop in government-bond yields sent money into stocks with relatively high

dividends. Bonds strengthened for a third consecutive session, with the yield on the

10-year Treasury note slipping to 2.317%—its lowest since late November.

Futures pointed to a slightly lower open for Asian markets on Monday,

as

companies continue to report their earnings. In company news, troubled Japanese

airbag maker Takata is setting up a compensation fund for victims of faulty air bags,

according to a report from the Wall Street Journal. The WSJ said Takata’s $125 million

program will steer money to consumers harmed when the air bags ruptured and

sprayed shrapnel. Elsewhere, Japanese internet and telecom giant SoftBank is close

to œinalising an investment in WeWork, with the deal expected to be worth over $3

billion, a source told CNBC.

Gold reached its highest in 3’1/2 months on Friday

as the dollar fell to a one-week

low after the new US Treasury chief poured cold water on the “Trumpœlation trade”

that had boosted the greenback this year. Treasury Secretary Steven Mnuchin said

on Thursday that any steps US President Donald Trump’s administration takes on

policy would probably have only limited impact this year, though he wants to see tax

reform passed by August. Spot gold XAU= was up 0.6 per cent at $1,256.75 an ounce

by 2.26pm EST (1926 GMT), having touched its highest since Nov 11 at $1,260.10

earlier, zeroing in on the 200-day moving average. It was on track to œinish the week

higher for the fourth straight week.

Disclaimer:

All information is not intended as professional advice to users. All

investment products and services are not obligations of or guaranteed by Baiduri

Capital and are subject to investment risks.

For more information, please call us on 226 8825.

Website:

www.baiduri.com/baiduricapital

Email:

baiduricapitalservices@baiduri.com

Baiduri Capital Sdn Bhd is an entity wholly owned by Baiduri Bank and is part of the

Baiduri Bank Group. Baiduri Capital offers a wide range of investment services as

below:

• Equities Trading • Exchange Traded Fund • Bonds • Unit Trust

• Investment-linked Life Insurance Products

Published from Tuesday to Saturday

Published from Tuesday to Saturday

CCY

BID

OFFER

TENOR SGD USD

EUR/USD

USD/JPY

GBP/USD

USD/CHF

AUD/USD

NZD/USD

USD/CAD

USD/HKD

USD/SGD

USD/MYR

USD/THB

USD/IDR

USD/PHP

USD/KRW

1.0575

112.24

1.2401

1.0074

0.7691

0.7206

1.3103

7.7605

1.4059

4.4390

34.85

13343

50.26

1,133.65

1.0577

112.29

1.2406

1.0077

0.7692

0.7209

1.3108

7.7610

1.4061

4.4430

34.87

13347

50.31

1,135.66

Overnight

1 week

1 mth

3 mth

6 mth

9 mth

12 mth

0.10

0.38

0.44

0.69

0.97

1.18

1.13

0.65

0.7

0.81

1.07

1.36

1.49

1.66

CRUDE AND GOLD PRICES

USD

Gold:

1,255.05 ( 2.14 )

Brent:

56.74 0.75

DAILY INTERBANK FOREX & MONEY MARKET COMMENTARY

(27/02/17)

FX OUTLOOK

The pound fell against all its major peers after The Times reported that UK Prime

Minister Theresa May’s team is preparing for Scotland to potentially call for an

independence referendum in March. Sterling fell as much as 0.6 per cent after

the newspaper cited unidentiœied government sources as saying May could

agree to a new Scottish vote, but on condition it is held after the UK leaves

the European Union. Leveraged and macro funds hit bids in response to the

report, an Asia-based foreign-exchange trader said. Scotland voted 55 per cent

to 45 per cent in September 2014 to stay inside the UK The House of Lords also

begins Monday a detailed examination of the bill authorizing May to trigger the

nation’s withdrawal from the bloc.

FX REVIEW

“If the market does seriously think there can be another independence

referendum much sooner than that, then remembering how hard the pound

fell in early September 2014 just in front of the prior referendum, the memory

of that makes sterling a fairly easy sell here,” said Ray Attrill, global co-head of

foreign exchange at National Australia Bank Ltd in Sydney. “I suspect there’s

been a bit of an overreaction here.”

All information provided is not intended as professional advice to users. This

daily commentary and opinion is subject to change without notice. For the latest

information, please call our Treasury Department on 226 8307.

Website:

www.baiduri.com

Email:

bank@baiduri.com

TOKYO (AFP) - Negotiators from 16 Asia-Pacific

countries on Monday held their first round of

free-trade talks since hopes faded of reaching a

separate regional deal after the US pulled out.

The

five-day

Regional

Comprehensive

Economic Partnership (RCEP) talks in the western

Japanese city of Kobe are being attended by senior

officials from the 16 countries involved, a Ministry

of Economy, Trade and Industry (METI) official

said.

The United States is not part of RCEP, which

has been pushed by China. Apart from Beijing,

the planned pact would group the 10 members

of the Association of Southeast Asian Nations

plus India, Japan, South Korea, Australia and

New Zealand.

Within days of taking office, President Donald

Trump pulled out of the separate Trans-Pacific

Partnership (TPP), an ambitious free-trade

agreement championedbyhis predecessor Barack

Obama but which Trump claimed was harmful to

the US.

The move fulfilled a key campaign promise

but left allies in Asia on the back foot. The TPP

had been seen as an economic guarantee of

US commitment to the region in the face of the

growing influence of China, which was not a

member.

RCEP is seen as a more modest deal that calls

for lower and more limited regulatory standards.

During themeeting - the 17

th

round - participants

are aiming to “push negotiations forward broadly

in the fields of goods, services, investment,

intellectual property, rules of origin, competition

and electronic commerce,” the METI official said.

“It is important to strike a quality deal in RCEP

at a time when protectionism is emerging around

the world.”

Asia trade talks resume after US

exit dashes hopes for TPP deal

HONG KONG (AFP) - Asian markets kicked the

week off with losses Monday, with Tokyo hit by

a stronger yen, as the global Trump rally shows

signs of fragility before a key speech by the new

president to Congress.

A record 11

th

successive all-time high close

for New York’s Dow was not enough to inspire

investors who are growing worried that the recent

buying - fuelled by expectations Donald Trump

will introduce economy-boosting measures - may

have gone too far.

Treasury Secretary Steven Mnuchin’s warning

that growth might not hit the four percent Trump

promised, as well as uncertainty around the new

president’s plans to slash taxes and spend big on

infrastructure, sent the dollar tumbling Friday.

And it struggled again on Monday, sitting at

around 112 yen - levels not seen since the end

of November and more than five per cent down

from highs touched at the start of the year.

The greenback was also lower against the euro

but climbed against the pound after Britain’s

Sunday Times reported Prime Minister Theresa

May was preparing for Scotland’s leaders to call

for another independence referendum following

last year’s Brexit vote. The majority of Scots voted

to remain in the European Union.

The sharp advance in the yen hit Japan’s

exporters, sending the Nikkei 0.9 per cent down,

while Hong Kong lost 0.2 per cent, Sydney sank

0.3 per cent and Seoul was 0.4 per cent lower.

Singapore gave up 0.4 per cent.

Shanghai shed 0.8 per cent. China’s top

securities regulator on Sunday pledged to speed

up approvals of initial public offerings as the

government seeks to attract capital and encourage

domestic growth.

But in early European trade London and

Frankfurt each rose 0.5 per cent, while Paris

added 0.4 per cent.

“This week it’s really about President Trump,

his address to a joint sitting of Congress and his

tax plan,” Greg McKenna, chief market strategist

at CFD and FX provider AxiTrader, said in a note.

“I get a sense traders want to believe in him

- hence the stocks rally - but gold up and rates

down suggest there is some fraying at the edges of

market ebullience.”

Markets are hoping the speech on Tuesday

will provide more details about Trump’s tax

pledge, which he said this month would be

“phenomenal”.

“Investors

are

now

worried

Trump’s

‘phenomenal’ tax plan won’t be something that

beats market expectations,” Shinichi Yamamoto,

a senior strategist at Okasan Securities, told

Bloomberg News.

Also in traders’ sights this week are the release

of revised fourth-quarter US growth data, the

Federal Reserve’s Beige Book report on the

economy, a string of Japanese data and factory

activity figures from China.

Asian markets start

week with fresh losses

AFP

An electric quotation board ’lashing the Nikkei key index of the Tokyo Stock Exchange is displayed

at a securities company in Tokyo