☕️ Malaysia's benchmark stock market index FBM KLCI - worst performer in ASEAN, 2nd-worst in Asia

Happy New Year!

1. MARKET SUMMARY

2. NUMBERS AT A GLANCE

USD5.8 trillion — the global merger and acquisition (M&A) volumes in 2021, up 64% from a year earlier, according to Refinitiv. The frenzy activities were fueled largely by the easy availability of cheap financing and booming stock markets. Investment bankers foresee the pace to remain in 2022.

USD197 billion — the amount of China's property developers bills due in Jan 2022, with worker wages contributing the biggest portion (USD173 bil). Beijing has urged builders to meet payrolls by month-end (Chinese New Year is on Feb 1, 2022) to avoid the risk of social unrest.

Golden State Warriors Stephen Curry scored at least one three-pointer for 158 successive games — breaking his own record of 157.

3. COVID-19 SUMMARY

• Health Minister Khairy Jamaluddin has warned of a high possibility of an Omicron wave starting in Malaysia. He added that Omicron was more infectious than Delta and would still strain the health system and facilities if transmissions increased. Please stay safe! On another note, where is the simplified SOP?

• Ministry of Health has imposed new rules for those already performing or set to depart for umrah before the government’s travel prohibition begins on Jan 8, after observing a trend of Omicron Covid-19 patients amongst those returning from their umrah.

• A report published by the UK Health Security Agency found booster protection against Omicron drops at 10 weeks. The participants in the study had either two shots of AstraZeneca and booster from a vaccine using mRNA technology OR three shots of Pfizer.

• The 2021 Ballon d’Or winner Lionel Messi tested positive for Covid-19, along with three other teammates.

4. IN MALAYSIA 🇲🇾

Politics & Local

1. PM Sabri said government assistance for flood victims whose houses were totally destroyed in the floods could receive assistance as much as RM61,000. He also said the government is focusing on seeking comprehensive long-term solutions to flooding to reduce its risks and the number of affected locations in the future (this should have been done ages ago). The Meteorological Department (MetMalaysia) has issued continuous rain warnings at the danger, severe and alert levels for most states until Tuesday, 4 Jan. An unknown motorcyclist has been going from house to house in flooded zones, giving every home RM100, but nobody knows where he is from or who he represents. Hats off to this legend.

2. The government has u-turned on its decision to tax income from foreign sources after earlier announcing in the 2022 budget that foreign income will be taxed from Jan 1, 2022. The exemption will run for five years from Jan 1 until Dec 31, 2026, granted on dividends to companies or limited liability partnerships, while individuals will be eligible for exemption for all types of income.

3. UMNO’s Rembau MP Khairy Jamaluddin sees MUDA as a tough rival to capture young voters after being successfully registered as a political party, based on his experience as young voters did not support BN and UMNO in the last general election due to the current issues of the time. The way the two backdoor governments handled the pandemic and the flood pretty sure will make it harder for the younger generations to vote for the political dinosaurs.

4. Massimo Bread has revised the prices of most of its products - the new prices listed below are effective today! New year, new trend? We certainly hope not!

Business

1. Sarawak Consolidated Industries Bhd (SCIB), another group under embattled Serba Dinamik’s CEO Abdul Karim Abdullah belt, said its external auditor has expressed a qualified opinion on the group’s financial statement for the year ended 30 Jun 2021. The counter has been suspended from trading since 9 Nov. Keep an eye out on Kumpulan Powernet Bhd (KPOWER), another listed company of Karim’s - the ‘contagion’ might spread there.

2. Malaysia’s benchmark stock market index, FBM KLCI, ended 2021 down 3.67%. In comparison, the US S&P 500 index rose 26.89% in 2021. The KLCI index could have ended the year in a worse position had it not been a sudden surge in buying interest in 5 component stocks (KLCI comprises 30 component stocks), namely IHH Healthcare Bhd, Top Glove Corp Bhd, Axiata Bhd, Digi.Com Bhd and Petronas Gas Bhd, pushing the index up by 1.3%. The Malaysian stock market is the worst performer in ASEAN and the second worst-performing market in Asia, after Hong Kong. What would have contributed to such underperformance? Hmmm…

3. The Ministry of Finance has moved to reinstate the stamp duty cap on contract notes for the trading of listed shares on Bursa Malaysia. Effective 1 Jan 2022 to 31 Dec 2026, the cap will be at a higher limit of RM1,000 from RM200 previously, with a higher rate of 0.15% versus 0.1%.

4. 2021 stats on listed companies on Bursa Malaysia:

   1. The number of new listings increased 53% 29 in 2021 from 19 a year earlier

   2. 6 new listings on the Main Market, 11 on the ACE Market and 12 on the LEAP Market

   3. The total number of listed companies across Bursa Malaysia at 949 - 763 on the Main Market, 142 on the ACE Market and 44 on the LEAP Market

5. The Malaysian Industry Timber Board (MTIB) expects wood-based product exports to hit RM23 bil in 2021, compared to RM22.01 bil achieved in 2020. Amongst the main export destinations are the US, followed by Japan, China, Singapore and India. The wood-based industry incurred losses estimated at almost RM10 mil following the floods that affected Klang Valley and Selangor.

5. AROUND THE WORLD 🌎

1. A South Korean has apparently defected to North Korea after the person was detected in the Demilitarised Zone (DMZ). Unsure if the person is alive, military chiefs in Seoul have asked the North for the person to be protected since North Korea has implemented a shoot-on-sight policy during the pandemic.

2. China called Walmart Inc “stupid” after the company’s warehouse stores (called Sam’s Club) in the country stopped selling items from Xinjiang. The Central Commission for Discipline Inspection rejected suggestions that inventory management was behind the shift.

3. Tesla raises prices of locally assembled Model 3 and Model Y again in China, the second time in just over a month. While Telsa did not provide any reasons for the price increases, analysts believe the move was made to address a widening gap between capacity and demand. Fun fact — Tesla’s Shanghai factory has an annual production capacity of at least 450,000 units!

4. A major blaze ripped through the Houses of Parliament in the South African city of Cape Town yesterday. The building, consisting of three sections, is severely damaged. President Cyril Ramaphosa said the building’s sprinkler system did not function properly. Fortunately, no injuries have been reported. A man has been arrested over the fires. He will face charges of arson, housebreaking and theft.

5. 2022 is not off to a great start for Ikea lovers — the furniture company said prices at its stores will increase by an average of 9% around the world to help offset significant transportation and raw material costs incurred. The ongoing global supply chain problem isn’t going away anytime soon, so budget your big-ticket items properly!

6. Mexico wants to have its own digital currency by 2024, according to an announcement on Twitter. However, this is not confirmed by its central bank, Banco de Mexico. No further details have been confirmed by the government and the central bank on the matter. Several central banks worldwide are exploring the launch of their own digital currencies as decentralised cryptocurrencies could weaken government control of monetary policy — but what makes their digital currencies different from existing currencies?

7. Billionaire investor Chamath Palihapitiya expects emerging blockchain and DeFi projects to overthrow two of the biggest payment processors, Visa and Mastercard, in 2022. Why? Because Amazon banned the usage of Visa credit cards in the UK due to high transaction fees. He believes Amazon did it because it’s a test of what they can do all around the world.

8. A few of us could be enjoying a long weekend as some of Microsoft’s Exchange servers stopped processing emails just as the clock struck midnight on New Year's Eve. The technical issue seems to lie with how Microsoft was naming updates for its malware-scanning engine — putting the year, month, and day (220101) at the front of another four-digit number (0001). Any updates in 2022 would start with 22 (followed by eight digits), but the problem is the field this number was stored in had a limit of 31 bits, meaning the highest number that could be represented is 2,147,483,648 or 2 to the power of 31. Uh-oh…The update affects Microsoft's anti-malware scanning software — one dangerous workaround is disabling the malware filtering feature, which Microsoft warned against. Instead, it should only be used if you have an existing malware scanner for email other than the engine in Exchange Server.Microsoft has since released a resolution for the problem — both an automated scan engine reset script solution and a manual input solution. You can show your system administrator the post.

6. FOR YOUR VIEWING PLEASURE 👁👁

1. Vox summarised 2021 in 6 minutes.

2. New year, new perception. It’s never too late.

3. Learn how life-saving airbags work.

4. For the first time ever, 10 individual fortunes exceeded USD100 bil each.