US: Retail Sales stay unchanged at $684 billion in September

Retail Sales in the US stayed unchanged in September.

US Dollar Index clings to strong daily gains above 113.00.

The data published by the US Census Bureau showed on Friday that Retail Sales in the US, adjusted for seasonal variation, holiday and trading-day differences but not for price changes, stayed virtually unchanged at $684 billion in September. This reading followed August's increase of 0.4% and came in below the market expectation of +0.2%.

"Total sales for the July 2022 through September 2022 period were up 9.2% from the same period a year ago," the publication further read. "The July 2022 to August 2022 percent change was revised from up 0.3% to up 0.4%."

Market reaction

The US Dollar Index showed no immediate reaction to this data and was last seen rising 0.55% on the day at 113.08.

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U.S. Futures Rise as Amazon, Apple Shares Surge Before Market Open

U.S. stock markets are set to open higher Friday, set to end the week on a positive note on the back of strong earnings from tech giants Amazon and Apple.

By 6:46 AM ET (1046 GMT), Dow Jones futures were up 109 points or 0.34%, S&P 500 futures rose 0.77%, and Nasdaq 100 futures increased by 1.17%.

The main indices are on course for a second positive week in a row, with generally strong corporate earnings holding sway even after the Federal Reserve hiked interest rates by a further 75 basis points and GDP contracted for the second quarter in a row.

The blue-chip Dow Jones Industrial Average is 2% higher so far this week, while the broad-based S&P 500, and the Nasdaq Composite have both gained 2.8%.

Highlighting the session today will be earnings from the Big Tech sector, with both Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) surpassing expectations with their quarterly results released after the close on Thursday.

Shares in Amazon zoomed higher by more than 12% in premarket trade, thanks to a revised outlook from the company that offset slower net sales growth compared to the same period last year. Amazon now expects a jump in third quarter revenue, citing bigger fees from Prime loyalty subscriptions and resilient consumer demand.

Apple also forecasted strong demand for its flagship iPhone product despite consumers tightening other spending as economic growth slows. The firm also declined to give specific revenue guidance due to economic uncertainty but said annual sales should rise faster in the current quarter than the 2% growth it posted in the just-ended last three months.

Shares in Apple edged into the green by 2.28% in premarket trading.

A fresh batch of European data also helped ease some risk sentiment. The 19-nation Eurozone grew surprisingly strongly in the second quarter, defying expectations of a slowdown and the previous day’s weak U.S. release. Healthy performances in Spain, France, and Italy helped offset stalling growth in Europe's biggest economy, Germany.

However, inflation - which has weighed heavily on business and consumer activity in the region - came in at a new record high of 8.9% compared to the prior year, up from 8.6% in June. Analysts had been anticipating the number to stay at that prior level.

Concerns still remain that the Eurozone will tip into a recession either late this year or early next year despite the strong second quarter.

Meanwhile, crude oil prices moved up on Friday, helped by supply concerns ahead of next week’s meeting of a group of top producers even amid fears of a global recession.

By 7:08 AM EST (1108 GMT), U.S. crude futures were up 2.33% at $98.67 a barrel, while Brent crude was up 2.21% at $104.08 a barrel.

Additionally, gold futures popped slightly to $1,759.40/oz, while the EUR/USD was trading at $1.0225.

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 Malaysia: Investment Approvals normalized in Q122 – UOB

UOB Group’s Senior Economist Julia Goh and Economist Loke Siew Ting assess the latest approved investment figures in Malaysia.

Key Takeaways

“Total approved investments normalised to MYR42.8bn in 1Q22 (or -56.6% y/y from record MYR98.7bn in 1Q21) following a high base of comparison whereby a megaproject was approved in the same period last year. Bulk of 1Q22 approvals was channelled to the manufacturing sector (MYR30.0bn or 70.0% of total approved investment), with the electrical & electronics (E&E) subindustry remaining the top beneficiary. The real estate and agriculture sub-sectors were the biggest recipients of approved investments in the services and primary sectors respectively.”

“Foreign direct investment (FDI) remained a key source of overall committed investments, totalling MYR27.8bn or 65.0% of total approved investment. Top FDI sources in 1Q22 were Germany (MYR8.9bn or 32.0% of total approved FDI), Brunei (MYR5.1bn or 18.3%), the USA (MYR3.9bn or 14.0%), Hong Kong (MYR3.3bn or 11.9%), and Japan (MYR3.2bn or 11.5%), which collectively accounted for 87.7% of total FDI approved in the manufacturing, services and primary sectors.”

“Going forward, the government’s approach to managing endemic COVID, targeted trade and investment missions, and medium-term prospects are expected to support Malaysia’s investment momentum amid multiple external headwinds on the horizon. MIDA has identified a pipeline of potential investments worth MYR150.4bn and proposed investments of MYR14.4bn. As such, we maintain our total approved investment projection at MYR200bn for 2022 (2021: MYR309.4bn, prepandemic five-year average: MYR204.5bn).”

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