Weekly Equities Summary and Outlook: July 4-8, 2016
Outlook: We expect the market to test the 7,900 levels this week after the US posted a better-than-expected jobs report.
The PSEi fell 0.75% last week to 7,771.52 as investors locked in their gains after the PSEi rose 7,846. Friday’s US job report showed an added 287,000 jobs in June, exceeding economists’ expectations by more than 100,000 jobs. This will fuel the optimism in the market for the week which may wane by end of the week as investors take profit.
Year-to-date, the index gained 11.79%. Foreigners were net buyers during the week amounting to Php2.92bn ($62mn); yearto-date foreign inflow was at Php35.34bn($751mn). MEG, MBT, SMPH, TEL and BDO were the most bought stocks for an aggregate amount of Php1.19bn.
Read the full article here: HERE
Weekly Fixed Income Summary: July 4-8, 2016
Bonds Outlook. We expect bond yields to trade sideways as EM’s remain a strong option for foreign investors to put their money in amid global concerns over Brexit. The Philippines remains attractive because of its minimal exposure
to the United Kingdom and/or the European Union coupled with the new administration’s bullish stance on government expenditures. Furthermore, the June core inflation rate rose to 1.9% from 1.6%, closer to the BSP’s 2016 inflation target rate of 2%-4%. This is in line with the central bank’s assessment that inflation will move towards the target over the policy horizon.
We expect the BSP to hold the policy rates steady for the rest of the year. BSP Governor Armando Tetangco, Jr., on the heels of July 7’s auction, said that the TDF auctions have now reached sustainable levels compared to the first few auctions under the new IRC system that were way oversubscribed. The bid-to-cover ratio of the 7-day tenor decreased to 6.025% from 6.138% in June 29’s auction, while the 28-day’s ratio declined to 4.056% from 4.598%. Short-term deposit auctions’ volumes for the third quarter increased to Php50bn from June’s Php30bn, also consistent with the BSP’s intent to move interest rates closer to the policy rate.
Read the full article here: HERE
Weekly Equities Summary – July 1, 2016
Duterte Euphoria, Calm Post-Brexit send PSEi to all-time high
| Current | Weekly | YTD | |
| PSE | 7,830.35 | 2.63% | 12.63% |
| FMETF | 128.80 | 2.71% | 13.48% |
| All Shares | 4,738.03 | 4.30% | 18.73% |
| Financials | 1,763.81 | 2.02% | 13.74% |
| Industrial | 11,926.64 | 1.49% | 8.12% |
| Holdings | 1,655.75 | 3.42% | 8.20% |
| Property | 3,443.80 | 3.78% | 18.12% |
| Services | 7,647.91 | 1.68% | 15.86% |
| Mining & Oil | 11,289.54 | 4.08% | 8.27% |
Outlook: We expect the market to correct after reaching an all-time high for the year. The market may lose steam this week as the “Duterte euphoria” ebbs after his inauguration.
The PSEi rose 2.63% last week to 7,830.35 (on close) as investors picked up bargains post-Brexit sell-off during the other week. The inauguration of President Duterte also became a catalyst for the market to reach 7,830.35 on Friday.
Year-to-date, the index gained 12.63%. Foreigners were net buyers during the week amounting to Php5.89bn ($125mn); year-to-date foreign inflow was at Php32.11bn ($683mn). SMPH, MBT, URC, SM and BDO were the most bought stocks for an aggregate amount of Php2.41bn.
Macro News: The Indonesian government halted permit issuance to all “flagged”vessels sailing to the Philippines due to maritime piracy and kidnapping in the Sulu Sea. The Philippines heavily relies on Indonesia for its coal requirements (68% of the 22mn metric tons coal demand by the Philippines came from Indonesia). This was positive for Semirara Mining and Power Corp. which is the country’s biggest coal miner, supplying 80% of the country’s 22m coal consumption.
Meanwhile, the Bureau of Customs collected Php37.5bn in June, up 19% year-on-year based on preliminary figures. In the first three months, collections fell 2% to Php90.5bn on weaker commodity prices. BOC is tasked to collect Php498.7bn, a 35.9% increase year-on-year.
Imports rose 29% in April to $6.53bn on the back of growth in industrial machinery (+74%), electronics (70%), and telecom equipment (+73%). For the first four months, imports surged 13.5% to $25.1bn. Trade balace was at a deficit of $2.28bn in April. For the first four months, trade balance was at $7.8bn deficit.
Loan growth (net of RRPs) of commercial banks rose 17.7% in May from 15.6% in April. Loans for production increased 17.9% while consumer loans jumped 16.8%. M3 expanded by 13.5% year-on-year to Php8.66tn.
Corporate News: GTCAP increased its stake in Profriends to 51% from 22.7%. The transaction was valued at Php8.76bn, similar to the initial stake that was bought last year.
JG Summit (JGS) acquired a 22% stake in Global Business Power from Orix at Php8.6bn. The new ownership structure is now as follows: Beacon/Metro Pacific (56%), Meralco (22%) and JGS (22%).
President Duterte’s order during his first cabinet meeting was the cancellation of online gambling licenses, citing its negative effects to the poor. This led to the slump in Philweb (WEB) and Leisure and Resorts World Corp (LR) shares.
8990 Holdings will launch a high-rise residential tower along EDSA corner Banahaw Street. It will have 5,207 units and has a sales value of Php7.2bn. Megawide will construct the tower with a contract value of Php3.6bn.
Read the full PDF here: HERE
Fund Fact Sheets – February 5, 2016
Fund Fact Sheets for February 5, 2016
Fund Fact Sheets – January 29, 2016
Fund Fact Sheets for January 29, 2016
Fund Fact Sheets – January 22, 2016
Fund Fact Sheets for January 22, 2016
FMIC: Peso set to lose more value in 2016
Originally aired: FMIC: Peso set to lose more value in 2016. Headline News. CNN Philippines. January 7, 2016, 8:21 AM (PHT).
BSP rate hike predictions
Originally aired: BSP rate hike predictions. F1RST UP. BloombergTV Philippines. January 11, 2016, 7:50 AM (PHT).
Market Views: Analysts expect at least 6 percent GDP growth this year
Originally aired: Analysts expect at least 6% GDP growth this year. Business Nightly hosted by Cathy Yang. ANC. January 6, 2016, 10:11 PM (PHT).
Fund Fact Sheets – January 15, 2016
Fund Fact Sheets for January 15, 2016
