Thesun 2009-04-09 Page16 Japan Set To Boost Stimulus To Us$150b

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theSun

KLCI STI Hang Seng SCI

business

907.87 1,783.96 14,474.86 2,347.39

T -11.97 T -18.43 T  -454.11 T -91.80

Nikkei TSEC KOSPI S&P/ASX200

8,595.01 5,443.56 1,262.07 3,619.50

| THURSDAY APRIL 9 2009

T  -237.84 T  -133.29 T -38.03 T -86.80

KL market summary

APRIL 8, 2009

INDICES FBMEMAS COMPOSITE INDUSTRIAL CONSUMER PROD INDUSTRIAL PROD CONSTRUCTION TRADING SERVICES FINANCE PROPERTIES PLANTATIONS MINING FBMSHA FBM2BRD TECHNOLOGY

CHANGE 5,960.68 907.87 2,151.11 288.86 67.63 179.48 121.62 6,752.03 532.21 4,731.39 243.17 6,298.09 3,961.84 11.37

-77.27 -11.97 -25.41 -1.14 -0.61 -3.73 -1.59 -98.90 -11.44 -30.66 UNCH -77.00 +7.15 -0.15

TURNOVER

VALUE

613.012mil

RM945.836mil

Prices lower on profit taking SHARE prices on Bursa Malaysia ended the day lower on weak buying momentum as investors locked in profit while awaiting announcement of the new cabinet line-up, dealers said. The KLCI fell 11.97 points to 907.87 after opening five points lower at 914.84 in the morning. TA Securities in its research note said the local bourse extended into profit-taking consolidation yesterday with overnight falls on Wall Street which further dampened market tone. The KLCI is expected to test the 910-point support for resilience tomorrow, one of the dealers said. At closing, the Finance Index declined 98.9 points to 6,752.03, the Industrial Index dropped 25.41 points to 2,151.11 and the Plantation Index decreased 30.66 points to 4,731.39. Of the FTSE-BM Index series, the FBMEmas fell 77.27 points to 5,960.68, the FBM30 shed 74.89 points to 5,826.76, the FBM2BRD rose 7.15 points to 3,961.84 and the FBM-MDQ went down 70.31 points to 2,986.05. Decliners led advancers by 352 to 144 while 178 counters were unchanged, 571 untraded and 36 others suspended. Among the actives, Maybank-OR declined four sen to RM1.02, Axiata rose five sen to RM1.84, KNM fell half sen to 43 sen and Mulpha International dropped two sen to 29.5 sen. Of the heavyweights, Sime Darby and Maybank went down 10 sen each to RM6.05 and RM3.82 respectively, Tenaga Nasional was 25 sen lower at RM6.05 and TM decreased six sen to RM3.58. – Bernama

Japan set to boost stimulus to US$150b TOKYO: Japan may boost its latest economic stimulus package to US$150 billion (RM540 billion), reports said yesterday, as Asia’s biggest economy confronted a fresh slump in trade and a surge in bankruptcies. Japan’s current account surplus more than halved in February from a year earlier as plunging exports kept the world’s second-largest economy deep in recession, government data showed. Tokyo has ordered extra public spending of at least ¥10 trillion (US$100 billion) to revive the economy, and the Kyodo News and Jiji Press news agencies reported the package could be worth as much as ¥15 trillion (US$150 billion). Plummeting worldwide demand for Japanese cars, machinery and hi-tech goods has put Japan on course for its worst economic slump since World War II. The surplus in the current account, the broadest measure of trade in goods and services, more than halved in February,

though that was an improvement on a record deficit logged the previous month. There were also fresh signs of pain in the corporate sector. Japanese bankruptcies rose 14.1% in March to a six-year high, a survey showed. More than 1,500 companies collapsed with debts of ¥10 million or more each, Tokyo Shoko Research said. Even Japan’s mighty car and electronics makers have been badly hurt by recession in major markets including the United States, Europe and Japan. Sharp Corp said that it had fallen deeper in the red than expected in the past year, suffering its first-ever loss due to the economic downturn. The group estimated its net loss for the financial year to March 2009 at ¥130 billion, worse than its earlier prediction of a ¥100-billion shortfall. Other industry heavyweights such as Sony and Panasonic are also in the red and shedding thousands of jobs. – AFP

Troubled Ssangyong announces massive layoffs SEOUL: Ssangyong Motor yesterday announced plans to lay off more than one third of its workforce as part of a drive to keep South Korea’s smallest automaker afloat. The debt-stricken firm was put under protection from creditors in February, a move that means its Chinese owner, Shanghai Automotive Industry Corp (SAIC), no longer has management control. Court-appointed managers including Lee Yoo-Il have since struggled to turn the company around through job cuts and cost savings. “I hope our new self-rescue programme will lay the ground for Ssangyong’s resuscitation and growth,” Lee told reporters. The programme calls for the layoffs of

briefs Malaysia off OECD’s worst tax haven list

Bank launches ‘happy deals’ pg 18

2,650 workers, or 37% of the workforce, and the sale of idle assets, he said. It would be the first mass layoff by a South Korean company since the onset of the global economic crisis in September. Union leaders representing 7,100 members immediately rejected the job cut plan and demanded managers minimise retrenchment through job sharing. It also called for an injection of state money and the sale of shares held by SAIC, which still owns a 51% stake in Ssangyong. Ssangyong has fallen into crisis amid slow auto sales. It posted a net loss of 709.7 billion won (RM1.9 billion) last year on sales of 2.5 trillion won, down 20% from a year earlier. – AFP

Asean to wrap up free trade deal at summit BEIJING: China and the Association of Southeast Asian Nations (Asean) are likely to sign an investment treaty this week, capping longrunning talks for a comprehensive trade agreement, a senior Chinese diplomat said yesterday. China signed an initial free trade agreement with the 10 members of Asean November 2002, and both sides had set 2010 as a deadline for a broader pact. . “It appears that this measure will be smoothly completed on time,” Chinese Assistant Foreign Minister Hu Zhengyue told a briefing ahead of meetings in the Thai resort town of Pattaya. The meetings start tomorrow between Asean and various dialogue partners, including China. “A bright spot of the Ten Plus One meeting will be the signing of an investment agreement, and this will signify that negotiations for a free trade zone including China and Asean have been completed,” Hu said of the meeting bringing together the 10 Asean member states

and Beijing. He would not describe any details of the investment agreement. He said the focus of this weekend’s meetings would be on strengthening cooperation to surmount the global financial crisis. And with Premier Wen Jiabao leading a team of senior economic officials to the meeting, China appears ready to cast itself as a reassuring pillar of regional growth. “Considering the current financial crisis, we believe it’s extremely important that both sides continue to strengthen investment between them,” Hu said of China and the Asean states. Beijing has recently signed currency swap agreements with Indonesia and Malaysia to help shore up trade. Hu said his government was open to similar deals with other Southeast Asian nations, some of which have raised the possibility. He would not name those countries. – Reuters

Asian markets plunge on earnings gloom HONGKONG: Stock markets across Asia tumbled for a second straight day yesterday as investors followed a dive on Wall Street and fears for corporate earnings further eroded confidence. Worries about the global banking sector, bleak export data from Japan

and figures showing a contraction in the Eurozone economy also helped fuel pessimism. Hongkong slid more than 4%, Tokyo 2.69%, Sydney ended 2.34% off and Seoul dived almost 3%. Markets throughout the region were in negative territory. – AFP

PARIS: The OECD on Tuesday removed Costa Rica, Malaysia, the Philippines and Uruguay from its list of hard-line uncooperative tax havens after they bowed to pressure and vowed to open up their books. “These four jurisdictions have now made a full commitment to exchange information according to the OECD standard,” OECD General-Secretary Angel Gurria told a press conference in Paris. They were the only remaining countries on the first of three lists published after world leaders agreed last week at a G20 summit in London to crack down on tax havens. One list named the four states the Organisation for Economic Cooperation and Development said had not pledged to accept international tax reporting standards. A second “grey list” named 38 territories that had committed to such standards but had not yet fully implemented them, and a third list identified 40 countries that had substantially implemented them. Costa Rica, the Philippines, Malaysia and Uruguay are now on the “grey list.” “They have officially informed the OECD that they commit to cooperate in the fight against tax abuse, that this year they will propose legislation to remove the impediments to the implementation of the standard,” the OECD said. – AFP

‘GM in intense bankruptcy preparations’ NEW YORK: General Motors Corp is in “intense” and “earnest” preparations for a possible bankruptcy filing, a source familiar with the company’s plans told Reuters on Tuesday. A plan to split the corporation into a “new” company made up of the most successful units, and an “old” one of its less-profitable units, is gaining momentum and is seen as the most sensible configuration, said another source familiar with the talks. If the plan goes through, the new GM would be expected to assume some previous creditor debt from bankruptcy proceedings, such as secured debt, said the second source, adding that GM bondholders were likely to lose substantial value in bankruptcy. – AFP

Swiss freeze money for OECD in tax haven spat ZURICH: Switzerland has frozen a financial contribution to the OECD in protest at being included on the organisation’s tax havens list without being consulted, the economy ministry said yesterday. “Switzerland used its veto rights” to withhold €136,000 (RM652,000) earmarked for cooperation between the Organisation for Economic Cooperation and Development and the Group of 20 countries, ministry spokeswoman Rita Baldegger said. “The amount is relatively modest but its a symbolic and strong gesture, a protest,” she told AFP. G20 leaders are using the OECD’s listing of compliance with its international tax exchange standard as a basis for a crackdown on secretive offshore havens. Switzerland was classified on a ‘grey’ list of about 40 countries which have pledged to comply but have not yet substantially implemented the standard. – AFP