News Highlights: On Wall Street, DJIA plunged 831 points at 25,598 (-3.2%), on fears higher interest rates could stifle growth after 10-year US Treas. breached 3.2%. On the local front, Singapore’s High Court dismissed the Philippine’s Setting Aside application, after giving the latter until 04 Oct. 2018 to appeal the dismissal of the case while PSA said 8-month trade deficit was $26bn (+66% y-o-y) due to increased imports of capital equipment & oil.
Selling prevailed, PSEi @7,001: Profit-takers seized local equities’ intra-day ascent, after touching 7,093 in early trades. The PSEi closed 58 points weaker at 7,001 & fetched an intra-day low of 6,992. All sectors were down paced by financials (-0.99%) & holdings (-0.87%). Laggards among actively-traded shares were: BDO (-P3 at P110); AP (-P1.40 at P32.60); ALI (-P0.20 at P39.50); & NOW (-P2.34 at P5.15). Bears pounded bulls, 139-54, on P5.1bn turnover. Net foreign selling widened to P508mn (+221% d-o-d).
Reaction vs. responses: Regional equities might be taken aback by Wall Street’s sharp overnight slump (DJIA -831, Nasdaq Comp. -315pts), to see if the market has already reached its bottom. Players would need to shake out the market’s ‘emotional aberration’, before digesting the news with an objective perspective. This includes whether or not global economies remain in their growth path, or recession is underway. Contrarians are bound to seize on this rout as opportunity to buy, given the market’s ability to recover. Immediate support is 6,800-6,900, resistance 7,030.
Marts mixed: Asian stock markets were mixed Wednesday following a volatile session for US equities and US Treasury bonds’ yields retreat from a seven-year peak.
Worst sell-off hits US equities: DJIA plunged 831 points at 25,598 (-3.2%), on fears higher interest rates could stifle growth. 10-year US Treas. breached 3.2%. Tech shares were also lower, pulling Nasdaq Comp. -315pts, 7,422 (-4%).
Crude sharply fell: Crude sharply fell following American Petroleum Institute (API)’s report that a major build of 9.75 million barrels of United States crude oil inventories for the week ending October 5. West Texas Intermediate (WTI) shed $1.79 to $73.17/barrel.
Maynilad wins case vs. government:
Singapore’s High Court dismissed the Philippine’s Setting Aside application, after giving the latter until 04 Oct. 2018 to appeal the dismissal of the case. It also ordered the Phil. govt. to pay Maynilad S$40k by way of costs. Maynilad shall now work towards an efficient collection of its tariff adjustment. Maynilad is 52.8%-owned by Metro Pacific Investments Corp. (MPI), 25% DMCI Holdings, Inc. (DMC) & 21.5% Marubeni.
CLI’s 9M reservation sales +69%:
Cebu Landmasters, Inc. (CLI)’s 9M18 reservation sales grew 69% to P6.2bn, or 88% of the firm’s P7bn goal for the year. Key drivers were Casa Mira economic housing & other high-end projects in Cebu plus mid-market in Bacolod. Extra boost will come from upcoming projects in Bohol & Iloilo.
McDonald’s to set up NXTGEN stores:
Alliance Global Group, Inc. (AGI)’s McDonald’s Phils. has set P3bn in capex for 2019 to open new stores & upgrade facilities with self-paying kiosks. The new stores will be known NXTGEN stores where customers may place their orders & pay using their Visa, Matercard, debit or prepaid cards. McDo intends to convert 10% of their store base to NXTGEN & 70% by 2021.
APX gets first step clearance for distribution franchise for electricity in Iloilo:
Apex Mining Co., Inc. (APX) clarified to the Exchange, that while Congress has approved on 3rd & final reading that grants More Minerals Corp. the franchise to distribute electricity in Iloilo, the franchise bill will be tossed to the Senate before final clearance from Pres. Duterte. For now, SEC has approved the change in name of More Minerals, to MORE Electric & Power Corp.
8-month trade deficit at $26bn:
PSA said 8-month trade deficit was $26bn (+66% y-o-y) due to increased imports of capital equipment & oil. August’s trade imbalance was $3.5bn (+30%).