☕️ Stock trading accounts in Malaysia got targeted in widespread hacks

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

JPY4,000 (RM119) – Hikers planning to ascend any of Mount Fuji's four main trails will face this new entry fee starting this summer, following the passage of a bill by local authorities. This measure addresses concerns about overcrowding on the popular mountain due to a record surge in foreign tourists. While the Yoshida Trail previously implemented a JPY2,000 fee (~ RM59.50) and daily entry caps, this year its fee will double, and the neighbouring Shizuoka region will also introduce a JPY 4,000 charge for its three trails, which were previously free. Consequently, the number of climbers decreased to 204,316 last year.

11,500 – The number of complaints lodged against Hong Kong's taxi drivers reached this significant figure in 2023, marking a concerning 53% increase from the previous year. This surge in complaints, highlighting the famously rude and reportedly worsening behaviour of cabbies, is a critical issue that Hong Kong officials are attempting to address as part of their USD16bil blueprint to revive tourism, which has declined from 65 mil visitors in 2018 to 45 mil in 2024.

Why are the cabbies in HK (or maybe even around the world) becoming more disgruntled?

60% – Hong Kong's taxi industry faces significant challenges, with a high percentage of cabbies being 60 years or older, contributing to an ageing workforce. The average annual take-home pay for drivers is equivalent to USD 29,000, which is less than the median wage, deterring new recruits. Adding to their difficulties, the cost of a taxi license can reach as high as USD900,000, and daily rental fees are around USD 120, while ride-hailing services like Uber, used by 46% of residents despite unclear legal status, provide increasing competition.

3. IN MALAYSIA 🇲🇾

14,179 SPM candidates got straight A’s
Education director-general Azman Adnan announced that the country recorded 21% more Sijil Pelajaran Malaysia (SPM) students with straight A’s in the 2024 exams compared to the year before. Azman added that this year’s results were the best in 11 years, since the Government made it mandatory for students to pass Bahasa Malaysia and History back in 2013.

Notably, Johor performed well for SPM 2024 as the state recorded a national average grade (GPN) of 4.36, compared to the national GPN of 4.49, marking its best result in five years. Coincidentally, the Johor State Government also announced a special state holiday for April 28. One may think that the holiday was reserved to celebrate the excellent performance of its SPM 2024 students, but nope. The state public holiday is to celebrate the achievement of the Johor Darul Ta’zim (JDT) football club for advancing to the finals. Yes - a holiday for advancintg to the finals, not even winning the finals yet. They will play Sri Pahang in the finals of the Malaysia Cup at the Bukit Jalil National Stadium on April 26.

A simple SPM results announcement can still go wrong, as the SPM Analysis Report released by the Education Ministry contained an erroneous Jalur Gemilang. An image showed students in a classroom with a Jalur Gemilang that had two stars instead of one hanging on a wall. The flag also had eight alternating red and white stripes instead of 14, as shown below.

According to the credits on all of the images, they were generated using AI. This ‘false flag’ incident is the third such incident this month, with the incomplete illustration of the Jalur Gemilang on Sin Chew Daily’s front page and a depiction of another incomplete national flag in a video played at the TCE Baby Expo at the Mid Valley Exhibition Centre in Kuala Lumpur.

Klang Valley tak tahan lagi
Universiti Teknologi Malaysia's (UTM) senior lecturer in real estate economics and finance, Associate Professor Dr Muhammad Najib Razali, has sounded the alarm bells, saying that when the Klang Valley’s population increases to nearly 10 mil by 2030, it will put immense strain on existing infrastructure such as roads, water supply, sewerage, schools, hospitals, and other essential services. Additionally, the growing neglect of infrastructure and green spaces is feared to negatively impact residents' mental and physical well-being, all thanks to poorly-balanced urban planning.

We can already see the cracks in the infrastructure around us. A few hours of continuous rainfall is enough to trigger flash floods that paralysed several major highways across the Klang Valley earlier this week. PLUS Malaysia Berhad reported flooding at Kilometre 9.1 northbound, affecting the stretch from Shah Alam to Subang. Similar conditions were observed near the Shah Alam Toll Plaza on the ELITE Highway, where both the motorcycle and left-hand lanes were rendered impassable by floodwaters. 121 homes in Sungai Buloh and Batang Berjuntai were also temporarily flooded. Among the key factors of the floods is an overflowing retention pond.

Shorts:

1. Malaysia still 9th-largest exporter of high-tech goods

   Ministry of Science, Technology and Innovation (MOSTI) secretary general Hasnol Zam Zam Ahmad stated that Malaysia has maintained its position as the ninth-largest exporter of high-technology goods, having successfully exported USD127 bil of high-tech goods in 2023, where high-tech exports comprised 58.69% of total manufacturing exports that year. The telecommunications electronics product group remained the largest contributor with USD36 bil, accounting for 80.58% of total high-tech goods exports.

2. ZUS to open 200 more SEA stores this year

   Zuspresso Sdn Bhd, the company behind the ZUS Coffee brand, is planning to open nearly 200 stores in the region this year, increasing its presence in Malaysia, Brunei, the Philippines and Singapore, and opening stores in Thailand and Indonesia. ZUS has also overtaken Starbucks as Malaysia’s largest coffee chain in early 2024, with 743 stores in the country, while Starbucks operates 320 stores. Interestingly, ZUS conducts 70% of its sales online via deliveries and pickups. Its technology-focused business model has helped it sell coffee at over 20% cheaper than Starbucks.

3. Terengganu to enforce e-cig, vape ban starting August 1

   Terengganu state executive councillor for local government, housing and health, Wan Sukairi Wan Abdullah, said that the state is set to enforce the ban on the sale of e-cigarettes and vapes at business premises starting August 1. The state government will also decline any form of sponsorship from vape product producers or distributors for government-organised programmes and events, including advertising vape products.

4. AROUND THE WORLD 🌎

More tariff impacts
Why does the USD8.8 tril slice of the global economy escape Trump's tariffs?
While tariffs hit the global goods market quite badly, the global services market, worth USD8.8 tril last year, remains spared. Interestingly, analysts are saying that Trump’s administration might have excluded services from his landmark policies for several reasons. The US trade surplus in services was USD293 bil in 2024, in stark contrast to the USD1.2 tril trade deficit in goods. This could mean that the US trade surplus in services is a "bright spot" in its balance of payments with the rest of the world, while services are also a good area for growth for the US and might remain so for a while. Also, Trump may have pursued sweeping goods tariffs because they're more tangible to consumers and easier to explain than duties on obscure services. The international financial services industry is also heavily reliant on the US, with many names like Visa, Mastercard, and American Express based there, along with Big Tech names like Meta and Amazon. A tariff on these is “just not workable”. The difficulty of taxing services is also probably a big reason for the White House to give them a pass on tariffs. Lucky for Bermuda then, since the place has a USD30.6 bil services trade deficit with the US, which would mean saying goodbye to its 10% reciprocal tariff. The preceding article is worth the read - we don’t think we did a fair job to capture the essence of it.

Trade war with China to hit US healthcare
One sector that could be deeply impacted by the US tariffs and have a disproportionate impact on the health of Americans is pharmaceuticals. While it has been exempt from Trump’s tariffs so far, nobody knows how long that will last now that his administration has begun its investigation into the imports of medications and its ingredients. The US imports 75% of its essential medicines. However, the complex supply chain across the pharmaceutical industry means that there is a lag between tariffs and the impact they might have on patients, if they are ever imposed. At least in the short term, pharmaceutical companies and healthcare providers can eat the spike in costs like they did during the COVID-19 pandemic. That gives pharmaceutical companies and trade groups time to plead with the administration to ensure exceptions from the tariffs continue. Note that Americans are already struggling to meet the costs of healthcare as it is. One in three say they cannot take medications they are prescribed because of the cost, and 11% say they cannot meet their healthcare costs, with a higher burden on Hispanic adults at 18% overall.

China denies talks with US and demands the US to revoke all unilateral tariffs
China has reiterated its tough stance very firmly, and dismissed any speculation that progress has been made in bilateral communications with the US, contrary to what Trump has implied on Wednesday that “everything’s active” when it came to talks. Trump really seems to be negotiating against himself. The country has demanded that the US revoke all unilateral tariffs on China if they really want to solve the problem, and urged that the US “show sincerity” if it wants to make a deal. China also wants to see a number of steps from Trump’s administration before it will agree to trade talks, including showing more respect and naming a point person for the dialogue, as well as a more consistent US position and a willingness to address China’s concerns around American sanctions and Taiwan.

Boeing has a USD1 bil China problem
Meanwhile, no thanks to the tariffs, Boeing said it has about 50 planes that must be sold to other airlines because its Chinese customers said they won't take deliveries anymore. It said that China made up 10% of the company's commercial backlog, and the 50 planes are worth over USD1 bil in revenue. Chinese airlines have returned two completed planes to the US, and there are plans to return a third one. However, with its years of delivery delays, there is a fix to the problem as other customers are still waiting - the CEO of Malaysia Aviation Group, parent company of our national carrier Malaysia Airlines, shared that the group is talking with Boeing about taking over the delivery slots.

Food supply dilemmas

Indonesia food project risks ‘world’s largest’ deforestation
President Prabowo aspires to change Indonesia’s dependence on rice imports with a plan to plant a minimum of several mil hectares of rice, along with sugarcane for biofuel, in South Papua province’s Merauke. For context, one mil hectares is around the size of Lebanon. While it may sound like a great effort for food security, environmentalists are warning that it could become the world’s largest deforestation project, threatening endangered species in the region along with Jakarta’s climate commitments. Indonesia currently already has some of the world’s highest deforestation rates, but Papua retains some of the largest remaining untouched tracts. Besides environmental concerns, activists are also worried that the project will fuel rights violations in Papua, which is long plagued by alleged military abuses as a separatist insurgency rumbles on.

Japan imports grain from South Korea for first time in more than 25 years
The Japanese are now forced to import more rice into the nation amid soaring domestic price and supply shortages. Last month, the country had to import rice from South Korea for the first time since 1999. In the week to April 6, Japanese supermarket rice prices reached an average of JPY4,214 (USD30) for 5kg – more than double from the same period a year earlier. The nation’s stockpiles have been depleted after record-breaking temperatures affected the 2023 crop, a rise in consumption caused by increased tourists, and panic buying due to natural disaster warnings.

Shorts:

1. Hackers manipulate stocks in JPY100 bil illicit trading spree

   Japan is battling hackers who are hijacking online brokerage accounts for fraudulent trading amounting to JPY100 bil (USD700.4 mil) since February, with no signs of slowing down. These scams typically use the hacked accounts to buy thinly-traded stocks both domestically and overseas, allowing anyone who has built up a position earlier to cash out at inflated values. The hackers are likely using techniques like “adversary-in-the-middle” and “info stealers” to gain access to the accounts, by luring users to a fake site via phishing e-mails or malicious ads.
   Yesterday, Bursa Malaysia and SC confirmed similar incidents in Malaysia. The hack is believed to have originated from abroad.

2. Delivery Hero to exit Thailand

   Foodpanda is saying goodbye to Thailand effective May 23 — a decision made by its parent company Delivery Hero, which has been scaling down its operations in the Asia-Pacific region since 2023. The company entered Thailand in 2012, and reported losses despite revenue growth during the pandemic, when everyone was forced to stay home and order in. It has only 5% market share of the Thai food delivery market. Analysts are also saying that the food delivery business is expected to decline in the future, with Thailand’s estimated to decline by 1% year-on-year to THB86 bil (USD2.6 bil) in 2024. This would force players to streamline their operations or shut down in the coming years, leaving only a few strong companies to survive in the red ocean market.

5. FOR YOUR EYES 📺

1. Wise words by the late Charlie Munger.

2. While we worry about returns on our investments (in equities, funds, Bitcoin, gold, real estate, etc.), we might be missing the most important metric of all — the fertility rate. Our fertility rate has been down-trending, much like the rest of the world, really.

3. And how will this “simple” fertility rate impact our lives? Let’s look at the projections of a country which currently has a fertility rate hovering slightly above 0.70. The creeping and invisible snowball effect.