☕️ Microsoft acquires game publisher Activision for USD68.7 bil in cash
A take on ESG Investing - more theatre than substance. DOSM: Flood damage estimated between RM5.3 - 6.5 billion. 'Catch Azam Baki' movement peaceful protest at 1100, this Sat, 22 Jan @ Sogo KL.
1. MARKET SUMMARY
2. NUMBERS AT A GLANCE
7.5 births per 1,000 people — China’s birth rate in 2021, the lowest figure since records began in 1949. It scrapped its one-child policy in 2016, increasing the limit to three last year.
207 million people are expected to be out of work in 2022, compared to the pre-pandemic of 186 million in 2019, according to a report by the International Labour Organization (ILO). The global unemployment rate is projected to reach 5.9% in 2022. Global employment is expected to recover by 2023 only.
8% — price hike of De Beers’ diamonds. De Beers raised prices by about 8% at its first sale of the year as the world’s biggest producer of the stones cashes in on a buying frenzy for uncut gems. Some smaller rough diamonds saw prices hikes of as much as 20%. If you had your marriage proposal last year, well done. For those who missed the boat, budget for the hike or get a smaller stone — show her the newsletter. Timing is key. She should have said yes last year.
3. COVID-19 SUMMARY
Beijing city officials are asking people to stop ordering parcels from overseas following the incident of a local woman who may have been infected by Omicron after opening a parcel. Officials said they have found traces of the virus on a package she received.
Four PPVs in the Klang Valley will be opened for the elderly to get their booster shots beginning today — WTC KL, Axiata Arena Bukit Jalil, IDCC Shah Alam and Sokka Gakkai Hall Klang.
41% of Malaysian adults have received their Covid-19 booster dose!
4. IN MALAYSIA 🇲🇾
MACC Chief Commissioner Azam Baki Share Ownership Controversy
The Securities Commission (SC) announced yesterday (on a public holiday, why?) that it has completed its inquiry into the share purchase claims made by MACC chief commissioner Azam Baki and said that “it is not able to conclusively establish” if his trading account was not opened in his name as the beneficial owner or an authorised nominee.Securities Commission Malaysia is "not able to conclusively establish" that MACC chief Azam Baki breached Section 25(4) of the SICDA in allowing his younger brother to use his trading account to buy shares.
In response to SC’s decision, Azam Baki released a statement to record his gratitude that the SC has found that he had not committed any offence and will “fight corruption in the country without fear and favour”.
Azam Baki has declined to testify before the Parliament Select Committee (PSC) for Agencies under the Prime Minister’s Department on technical grounds. 4 of the 9-member PSC have accused him of being in contempt of Parliament as the Parliament has the prerogative to summon witnesses to testify.
The ‘Catch Azam Baki’ movement announced that it would be organising a peaceful street protest, citing disappointment over the apparent inaction against Azam Baki. The movement, made up of civil societies and political parties, said the protest would take place at 1100 on 22 Jan in front of the Sogo shopping mall in KL.
The estimated loss caused by the floods last month according to the Department of Statistics of Malaysia (DOSM) - RM5.3 bil to RM6.5 bil. The breakdown of the losses is as follows:
Infrastructure such as roads and bridges: RM2 bil
Houses: RM1.2 - 1.4 bil
Vehicles: RM1 - RM1.3 bil
Manufacturing sector: RM800 mil - RM1 bil
Business premises: RM500 - 600 mil
Agriculture sector: RM40.9 - 49.9 mil
The government will contribute RM10 mil to the Football Association of Malaysia (FAM) this year for national football development. Meanwhile, Koh Lee Peng, a paralympic athlete that has won seven gold and three silver medals for Malaysia, has resorted to selling tissue in Bukit Bintang to make ends meet — earning RM800 a month. She receives only RM300 in monthly assistance from the National Athlete Welfare Foundation.
It is a systemic issue the nation is facing when marginalised communities are constantly being neglected and will be given due consideration only when their issue goes viral. This is not how problem-solving should be - subject to virality.
The Shah Alam High Court has substituted the 10-day jail sentence and RM4,000 against 19-year old Daniel Iskandar with community service. He was caught stealing from Al Islahiah Mosque in Kuang and was subjected to a “corpse bathing” ritual, which partly involved being waterboarded on 8 Jan. The imam allegedly involved in the incident has resigned.
Bursa Malaysia announced that trading on the exchange will be opened for the morning session only on Monday, 31 Jan 2022 and will be closed for the afternoon session on the eve of Chinese New Year. It will also be closed on Tuesday, 1 Feb 2022 and Wednesday, 2 Feb 2022, in conjunction with the CNY and Federal Territory Day. Stock traders, you may gamble elsewhere during this festive season.
Troubled cruise operator Genting Hong Ltd warned it may file for liquidation and seek court assistance to safeguard its assets after failing to secure funding to help it stay afloat. The company’s trouble may not have any major ramifications for other Genting group of companies as it only shares a common shareholder in Lim Kok Thay, the CEO of Genting and has no cross-shareholdings with his other Genting companies.
HSBC Group Asian economics research co-head Frederic Neumann expects BNM to raise its overnight policy rate (OPR) by 50 basis points (0.5%) this year as domestic demand and export grow. BNM has kept OPR at 1.75% since Jul 2020, when it cut it from 2% to support the economy hit hard by the pandemic.
5. AROUND THE WORLD 🌎
The Tongan government has finally provided an update since last weekend's volcanic eruption — the government confirmed four deaths. The Tongan government said the internet was down, but some local phone services were available and work was underway to restore full communications. Some of the smaller outlying islands were particularly badly affected, with all the houses destroyed on one and just two left on another. At the same time, some houses were covered in volcanic ash.
China’s economy grew 4% in Q4 of 2021, amid stronger-than-expected industrial production in December and the economy grew by 8.1% YoY in 2021. The Q4 figure is the weakest growth the country has seen in a year and a half. While demand for China-made goods remains high, supply chain issues, logistical bottlenecks, and problems tracking shipping traffic have slowed economic activity.
The counter the slowdown, the Chinese central bank said it would cut the interest rate on 700 billion yuan (USD110 billion) worth of one-year medium-term lending facility (MLF) loans to 2.85% — 10 basis points lower. It’s the first time People’s Bank of China has cut the MLF rate since April 2020. It will likely put downward pressure on the Chinese currency.
The general public will not be able to buy tickets to this year’s Winter Olympics as part of strict Covid-19 restrictions in Beijing. The Winter Olympics, scheduled to run from 4-20 February, will only be available to “groups of spectators” only. Spectators will be selected through official organisations. The opening and closing ceremonies will be hosted at Beijing’s National Stadium.
Three people were killed in Abu Dhabi by a fuel tank blast triggered by Yemen’s Houthi rebels’ drone attack. The attack marks a strategic shift by the Iranian-allied rebel group. The UAE has dialled down its own direct military involvement in Yemen, but in the past few weeks, UAE-backed forces have turned their guns on the Houthis, making the rebels retaliate. Why is Yemen at war in the first place?
U.K. autonomous driving start-up Wayve received funding from the likes of Microsoft, Virgin and Baillie Gifford in a USD200 mil funding round. While Wayve did not disclose its new valuation, the start-up has likely achieved the unicorn status with a valuation in excess of USD1 bil.
The technology championed by Wayve involves trying to teach a car how to drive itself with machine-learning software and a few cameras. The funds raised will be used to pay for more talent, data and computing power, which it needs to train its algorithms.
Microsoft has just made its largest-ever acquisition by buying Activision, the major video-game publisher behind the “Call of Duty” franchise, in an all-cash deal valued at about USD68.7 billion. The deal values Activision’s stock at USD95 per share. Game franchises like “Call of Duty,” “World of Warcraft,” and “Candy Crush,” in addition to major game studios like Blizzard Entertainment and Treyarch, are also part of the deal. Activision's games will appear on Microsoft’s Game Pass in the coming months.
Samsung Electronics Co. partnered with Advanced Micro Devices Inc. (AMD) to launch the new eight-core Exynos 2200 processor, built using Samsung’s most advanced 4nm fabrication process and powered with AMD’s graphics. The chip is the industry’s first mobile chip with hardware support for ray tracing, an advanced approach to high-fidelity graphics that has been gaining traction in PC graphics cards.
Walmart is entering the metaverse quietly, unlike other big brands. The big-box retailer filed several new trademarks late last month, indicating its intent to make and sell virtual goods. In a separate filing, the company said it would offer users virtual currency and non-fungible tokens (NFTs).
Analysts at investment bank UBS think crypto markets could be set for another “winter” of price crashes and could fail to recover for years. In addition, interest rate hikes from the Federal Reserve in 2022 are set to dent the appeal of cryptocurrencies as rising interest rates make the currency a good store of value compared to bitcoin. However, that’s where we think the analysts are wrong — they should be using the inflation rate instead.
Singapore’s Monetary Authority of Singapore (MAS) has asked service providers of cryptocurrency not to promote their services to the general public in the country. MAS issued a new set of guidelines to discourage cryptocurrency trading by reducing advertisement avenues. Service providers are not allowed to engage with third-parties nor place ads in public areas.
6. FOR YOUR VIEWING PLEASURE 👁👁
An interesting take on ESG investing - “mostly theater, little substance”
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