☕️ MOT: Full refund for flights delayed by five hours effective Sep 2

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

In the first seven months of 2024, the FTSE4Good Bursa Malaysia Shariah Index and FTSE Bursa Malaysia EMAS Shariah Index slightly outperformed their non-Shariah counterparts. By June 2024, 833 out of 1,049 listed securities on Bursa Malaysia were Shariah-compliant, representing 79.4% of the total. The market capitalisation of these Shariah-compliant securities grew by 19.7% year-on-year, reaching RM1.3 trillion, which constitutes 65.2% of the total market capitalisation.

YouTube is now the top choice for listening to podcasts in the United States, with 31% of people choosing it. Spotify is next with 21%, and ‌Apple Podcasts‌ is in third place with just 12%. This is very different from Apple's situation a few years ago. In July 2019, 29% of people who listened to podcasts each week mainly used ‌Apple Podcasts‌. Now, several reasons seem to be causing ‌Apple Podcasts‌ to become less popular — Apple Podcasts‌ didn't generate direct revenue for the company until recently and Apple Podcasts‌ is not available on Android, limiting its reach. There is also another competitor in town pouring money into podcasts — read more in the Global Section.

5 seconds are all it takes to de-escalate an argument between a couple, according to a study in the Nature Journal Communications Psychology. Researchers discovered that when couples took a short break from a competitive game, their negative feelings and aggression decreased. The study also found that couples usually matched each other's aggression during the game, but the break stopped this pattern and made them less aggressive.

3. IN MALAYSIA 🇲🇾

Two 1MDB crooks convicted in Switzerland
The Swiss Federal Criminal Court convicted two executives, Patrick Mahony and Tarek Obaid, for embezzling over USD1.8 bil (RM7.81 bil) from Malaysia’s 1MDB. The pair allegedly created a deceptive joint venture between their company, PetroSaudi, and 1MDB by falsely claiming Saudi government backing. This led to a scheme in 2009 where they defrauded the Malaysian wealth fund, enriching themselves with significant sums — Obaid getting at least USD805 mil and Mahony at least USD37mil. Obaid was sentenced to seven years in prison, while Mahony received a six-year sentence. This marks another chapter in the extensive 1MDB corruption scandal.

Another sinkhole in Masjid India
Jalan Masjid India is now closed to all vehicles after another sinkhole, about 50m from the first sinkhole incident (view here). The sinkhole appeared following the heavy rain and storm on Tuesday night.

Deputy PM Fadillah Yusof announced that an integrity audit will be conducted on the entire utility system at Jalan Masjid India after the search and rescue operation for the victim of the recent sinkhole incident is completed. The audit, involving agencies DBKL, Indah Water, JKR, the Fire and Rescue Department, and JMG, plans to examine all utilities and the underground system in the area as the government acknowledges that they are over 30 years old. 

Additionally, Federal Territories Minister Zaliha Mustafa revealed that the government is withholding approval for all new development projects in Kuala Lumpur until a task force is formed. The decision was made after ground collapses occurred at several places in the city, including a spot just 50 metres away from the sinkhole that swallowed a tourist last Friday.

Dr Zaliha assured that Kuala Lumpur is still safe, apart from the area around Jalan Masjid India, which has been closed to the public. Hopefully, we don’t turn out like the Lost City of Atlantis, except into underground limestone deposits instead of water.

Starbucks Malaysia parent company, Berjaya Food Bhd, looking less berjaya this financial year
Berjaya Food Bhd (BFood) reported an abysmal fourth quarter for the period ending June 30, 2024, with a net loss of RM38.20 mil, a decline from the net profit of RM17.28 mil recorded in the same quarter of the previous year. Its revenue was subject to an equal trajectory as it fell to RM130.57 mil from RM271.75 mil, about 48% down year-on-year. The company attributed this downturn primarily to the adverse consumer sentiment stemming from the ongoing Middle East conflict. Those boycotts are really taking a toll, eh?

For the full financial year ended June 30, 2024, BFood posted a net loss of RM91.52 mil, a catastrophic contrast with the net profit of RM103.40 mil reported in the prior fiscal year. Revenue for the year declined to RM730.30 mil, down from RM1.12 mil, reflecting broader market stresses and shifting patron behaviours. Despite these setbacks, BFood maintains a cautiously optimistic outlook, anticipating a gradual recovery in operational performance in the upcoming financial year.
View: BFood Q4 FY2024 results.

Shorts

1. Full refund for flights delayed by five hours- now everyone can fly (worry-free)

   Transport Minister Anthony Loke has announced key amendments to the Aviation Consumer Protection Code, requiring airlines to fully refund passengers for flights delayed by five hours or more, starting September 2. Airlines carry the responsibility of notifying passengers of any schedule changes at least two weeks in advance, besides providing refunds through the original method of payment or credit shells and vouchers, at the passenger’s discretion. Additionally, the time limit for filing complaints has been extended from one year to two years.

2. GXBank launches cyber insurance for protection against frauds and scams

   GXBank and Zurich General Insurance Malaysia have launched Cyber Fraud Protect, a digital insurance plan to safeguard Malaysians against financial losses due to unauthorized electronic transfers resulting from cybercrime or scams. The plan offers coverage of up to RM20,000 and has the widest support for local bank accounts, debit or credit cards, and e-wallets, with monthly fees from as low as RM1 to RM4. From the sound of it, this protection sounds like it covers other banks as well. The collaboration aims to provide robust protection in the digital landscape, with a focus on delivering a smooth customer experience through the Zurich Edge platform.
   On a side note, Malaysians lost a staggering RM1.6 bil to online scams in just over 19 months according to the Commercial Crime Investigation Department. Good opportunity for this insurance. Better be safe than sorry. NFA.

4. AROUND THE WORLD 🌎

A break in the clouds for the Middle East?
One of the biggest clashes in the conflict between Israel and Lebanon’s Hezbollah, where the latter claimed to have fired 320 drones and missiles while the former destroyed thousands of Hezbollah’s rocket launchers,  may have helped ease tensions. According to the US Joint Chiefs of Staff chairman, General C.Q. Brown, the clash ended with limited damage in Israel and without immediate threats of more retaliation from either side, with the immediate risk of a regional war “somewhat declined”.

Hezbollah’s strike also counted as one of the two major threatened attacks promised against Israel in recent weeks, with the other being Iran’s threat due to the killing of Hamas leader Ismail Haniyeh in Tehran. Brown stated it is now up to how Iran responds, which leads to how Israel responds, and that will “dictate whether there will be a broader conflict or not”.

Israeli officials had responded with satisfaction to the clash. Still, a government spokesperson said the situation where tens of thousands were evacuated from their homes in northern Israel was “not sustainable”. And what about the displaced Palestinians from evacuation orders issued by the Israeli military?

Meanwhile, negotiations in Cairo for a ceasefire in Gaza and a hostage deal are still moving forward, with a White House spokesperson stating that talks were “constructive” rather than breaking down, with the “next logical step” being the refinement of finer details among lower-level working groups. Still, most Gulf markets fell due to the regional tensions, with investors awaiting a key US inflation report for news on the likelihood of a September rate cut.

Macron in the hot seat after Telegram CEO arrest
The arrest of Russian-born French-Kittitian–Emirati entrepreneur (thanks, Wikipedia) and Telegram CEO and co-founder Pavel Durov on French soil has President Emmanuel Macron under fire from Russia and the UAE. Russian Foreign Minister Sergei Lavrov said relations between the two countries were at an all-time low after the extension of Durov’s detention, following existing tensions between the two countries.

Durov’s Emirati citizenship led to the UAE calling on France to provide him with “all consular services urgently”, with the promise that they are “closely following” Durov’s case. The arrest also led to the UAE suspending a deal to purchase 80 fighter jets from France, a deal worth USD19 bil that was inked in 2021.

Still, Macron has denied allegations that he had a part to play in Durov’s arrest by inviting Durov to “dine with him” to draw him to Paris, stating that the arrest was “part of an ongoing judicial investigation” and was “not a political decision”, taking to X to address the false information and citing France’s deep commitment to freedom of expression and communication.

However, his claim to being for freedom of speech had netizens bringing up how he had floated banning social media during riots in July 2023, a bid that faced significant backlash. More recently, Macron also rejected the French left-wing government’s choice for PM, leading to continued political turmoil in France almost two months after the elections. This led to the hard-left faction calling him “anti-democratic”. For reference, the left-wing government won the most seats, just not the overall majority.

Here’s an interesting take by Sequoia partner Shaun Maguire about the significance of Durov’s arrest.

Tech dollars and Business circuits

1. IKEA takes on eBay with its own secondhand online marketplace

   Swedish furniture giant Ikea will be launching a pilot secondhand marketplace, called Ikea Preowned, in a move to enter the resale market to compete with names such as eBay, Gumtree, and Finn. Currently, the site is only open to the test markets of Madrid and Oslo. One of its features helps sellers automatically provide details like furniture dimensions when they make their marketplace listings. While listing on the marketplace is free at this time, there may be a “symbolic” fee in the future, according to Ikea.

2. Nigerian Black Axe Mafia vs Interpol

   Interpol succeeded in a series of coordinated covert raids across 21 countries, dealing what it calls a “major blow” to the Nigerian mafia group called Black Axe with the arrest of 300 people linked to Black Axe and other affiliated groups. However, the agency warned that Black Axe has a global reach and technical sophistication, in a group that is “very organised and very structured”. It is reported that Black Axe, along with similar groups, are responsible for the majority of the world’s cyber-enabled financial fraud.

   As a side note, a poll found that cybercrime and other acts of sabotage cost German companies about USD298 bil in 2023, up 29% from the year before. About 70% of the companies polled attributed the attacks to organised crime. However, the top two targets blamed are China and Russia.

3. Warren Buffett offloads nearly USD1 bil worth of Bank of America shares

   Berkshire Hathaway, the investment firm of billionaire and “Oracle of Omaha” Warren Buffett, raked in USD982 mil as it offloaded more shares in Bank of America, leading to a combined sale of USD5.4 bil worth of shares in several sales since July. However, Berkshire Hathaway remains the largest shareholder in the bank with a stake of 903.8 mil shares, worth about USD36 bil. Buffett had started investing in Bank of America in 2011, when his investment firm purchased USD5 bil of preferred stock. Now, Bank of America stands as the second-largest lender in the US.

Shorts

1. Taylor Swift's boyfriend signs USD100 mil Amazon podcast deal

   The award-winning singer’s boyfriend, National Football League star Travis Kelce, just signed a USD100 mil deal with Amazon, giving the network exclusive multimedia rights to the “New Heights” podcast, which he launched with his brother and fellow NFL star Jason Kelce. They launched the podcast in 2022 and discussed their own lives, sports, and interviewed guest celebrities.

2. Charlatan child predator slapped with 17 years in prison

   Muhammad Zain Ul Abideen Rasheed pled guilty to 119 charges, relating to 286 people from 20 countries. He posed as a famous 15-year-old Youtuber and blackmailed hundreds of girls around the world into performing sex acts on camera, with two-thirds of the victims being girls under 16. Judge Amanda Burrows said there was “no comparable case” in terms of magnitude in Australia when she handed down her sentence.

3. Taliban bans MMA for being "un-Islamic"

   The Taliban government in Afghanistan has banned mixed martial arts for being “un-Islamic”, with the order passed down by the country’s morality police after an investigation into the sport’s compliance with Sharia law. They found the sport “problematic with respect to Sharia” with many aspects “contradictory to the teachings of Islam”.

5. FOR YOUR EYES 📺

1. According to Global Forest Watch, there are five common drivers of tree loss — forestry, shifting agriculture, wildfires, deforestation and urbanisation.

2. Don’t let your emotions master you. Take control.