Stocks
Asian stocks extend gains, dollar dips as US data builds on rate hope
Asian equities rose and the dollar slipped further on Thursday as investors welcomed more data pointing to a softening labour market that gives the Federal Reserve room to cut interest rates, with another key jobs report due later in the day.
The advances tracked another record on Wall Street on a holiday-shortened day, while national elections in Britain and France are also on the radar over the next few days.
After a recent poor run for stocks, the mood on trading floors has lightened this week thanks to figures indicating the US labour market was tightening and inflation retreating.
On Wednesday, figures showed the private sector created fewer jobs than expected last month, while first-time and continuing claims for jobless benefits also topped forecasts.
Also, a survey showed services sector activity contracted in June at the fastest pace in four years.
That all came after news Friday that the personal consumption expenditures (PCE) index — the Fed’s preferred gauge of prices — had dipped further in May.
Adding to the feel-good factor were comments this week from Fed chief Jerome Powell, who said the battle against inflation had made “progress” and “substantial” work had been done on softening the labour market.
Markets are pricing in nearly two rate reductions this year, starting in November.
Still, minutes from the central bank’s June policy meeting showed officials remained cautious about cutting too soon and wanted to see more evidence prices were under control.
While inflation remains sticky and is tempering expectations, softening data in May “adds to our growing confidence that price rises won’t reaccelerate from here”, said Henk-Jan Rikkerink, of Fidelity International.
“The range of outcomes when it comes to the magnitude of potential rate cuts by the Fed have narrowed significantly since the start of the year.
“We think that the bar for the cutting cycle to start remains high but recent progress on the inflation front has been encouraging.”
On Wall Street, the Dow ended slightly lower, but the S&P 500 and Nasdaq chalked up more record highs.
And the gains filtered through to most of Asia, with Tokyo, Hong Kong, Sydney, Seoul, Taipei, Manila and Jakarta ascending.
Shanghai, however, bucked the trend again, with traders still on edge about the state of the world’s number two economy.
Zhiwei Zhang at Pinpoint Asset Management warned “people don’t have strong confidence in economic outlook. Stronger policy support would help, from both monetary and fiscal fronts. China has a high real interest rate and a conservative fiscal policy stance for now”.
And Capital Economics’ Thomas Mathews said there were concerns among Chinese investors domestically and globally, and while they could ease over time “Chinese equities seem set to go their own way for a while yet”.
The dollar dipped further against its major peers after the jobs readings, with the euro getting a little help from news that more than 200 centrist and left-wing candidates had pulled out of Sunday’s legislative election runoff in France in a bid to beat the far right.
President Emmanuel Macron hopes the move will unify the vote and thus block the far-right National Rally (RN) of Marine Le Pen from gaining power after it saw massive gains in the first round Sunday.
However, analysts warned that the country — the second biggest economy in the European Union — could be headed for a period of political deadlock if there is no overall winner in the polls.
The pound was enjoying support ahead of Thursday’s general election, which is expected to see the opposition Labour Party win a landslide against the ruling Conservatives after 14 years in government.
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 0.2 percent at 40,666.78 (break)
Hong Kong – Hang Seng Index: UP 0.2 percent at 18,015.49
Shanghai – Composite: DOWN 0.2 percent at 2,975.23
Euro/dollar: UP at $1.0792 from $1.0786 on Wednesday
Pound/dollar: UP at $1.2752 from $1.2737
Dollar/yen: DOWN at 161.37 yen from 161.52 yen
Euro/pound: DOWN at 84.63 pence from 84.65 pence
West Texas Intermediate: DOWN 0.5 percent at $83.47 per barrel
Brent North Sea Crude: DOWN 0.5 percent at $86.94 per barrel
New York – Dow: DOWN 0.1 percent at 39,308.00 (close)
London – FTSE 100: UP 0.6 percent at 8,171.12 (close)
One of the Listed companies, National Polymer Limited has recommended 10.50% Cash Dividend for the year ended June 30, 2024.
It has reported Consolidated EPS of Tk 2.27 paisa, and Consolidated NAV per share of Tk 30.63 for the year ended March 31, 2024.
The Annual General Meeting (AGM) of the company will be held on December 18, through the digital platform. The record date for this has been fixed at October 22.
The Company also discloses its financial reports for the second quarter, (April – June 24).
As per the company’s consolidated life revenue account for April to June 2024, the excess of total income over total expenses, including claims (surplus), stood at Tk 1,394.24 million. This marks a significant increase from the surplus of Tk 823.68 million during the same period in 2023.
For the first half of 2024, from January to June, the company reported a surplus of Tk 2,177.57 million, compared to Tk 1,290.39 million in the corresponding period of the previous year.
Additionally, the Life Insurance Fund balance as of June 30, 2024, reached Tk 55,188.62 million, showing a net increase of Tk 5,892.25 million from Tk 49,296.37 million on June 30, 2023.
One of the Listed companies, Beacon Pharmaceuticals PLC has recommended 20% Cash dividend and 10% Cash Dividend to Sponsor Shareholder and Directors for the year ended June 30, 2024.
It has reported EPS of Tk 2.26 paisa, and NAV per share of Tk. 26.37 for the year ended June 30, 2024.
The Annual General Meeting (AGM) of the company will be held on December 23, through the digital platform. The record date for this has been fixed at October 27.
The Bangladesh Securities and Exchange Commission (BSEC) has removed three audit firms from its panel for their failure to secure enlistment with the Financial Reporting Council (FRC), according to a notice issued today.
The firms—A Hoque & Company, FAMES & R, and SK Barua & Company Chartered Accountants—were delisted following the FRC’s request. In December last year, the FRC published a list of enlisted audit firms and subsequently, in February, requested the BSEC to remove any firms that were not included on that list.
BSEC regulations mandate that financial statements signed by auditors outside its approved panel will not be accepted. With the removal of these three firms, the total number of audit firms on the BSEC panel has been reduced from 48 to 45.
Sources from the FRC revealed that 15-20 audit firms failed to secure enlistment last year, and approximately 45 chartered accountants are currently under restrictions imposed by the Institute of Chartered Accountants.
Although the delisted firms can no longer audit issuer companies or listed securities, they are allowed to complete audit and assurance services that were initiated before their removal, the BSEC clarified.
