Philipines Market Insights 2018.4.11


News Highlights: Chinese President Xi Jiinping’s remarks on more open trade left Wall Street (DJIA +428pts, Nasdaq Comp. +143pts) and Asian markets inspired. China pledges more aid as Pres. Duterte & Pres. Xi’s bilateral meeting proceeds. At home, 91D Tbills up 15.5bps, while SECB obtains clearance for its LTNCD issuance, and the transport bureau rejects AEV’s infra unit’s airport proposal.





Mart slipped, PSEi @7,934. Shares swung between gains & losses, although supply pressure kept gauges on weaker ground towards close. The PSEi finished 10 notches lower at 7,934 (-0.14%), as gains in industries (+0.55%) failed to offset services (-1.9%) & financial shares (-0.33%). Movements were limited at 7,890-7,985. SMPH (-P0.05 at P33.85); BLOOM (-P0.40 at P13.10); & BPI (-P3.10 at P105) fell, while ALI (+P0.25 at P41.25); AC (+P19.50 at P938.50); & BDO (+P2.10 at P136.70) advanced. Gainers-losers scored 70-137, on P7.12bn turnover.

Direction is up. Local shares might glide with positive ripples from Chinese Pres. Xi Jinping’s remark on foreign trade, seconded by Wall Street’s sharp overnight advance (DJIA +428pts). Financials, property & services might lead, esp. large-caps that were unduly trodden during the recent rout. Meanwhile, alerts would still be high on intraday rallies, as sellers might seize on this ascent to pocket gains. Start scouting for second-tiers that follow index stocks’ lead. Immediate support is 7,900, resistance 8,130-8,150.


Rallied after Xi’s comments. Asian shares had a lethargic early Tuesday session no thanks to Wall Street’s dampened performance but surged after Chinese President Xi Jinping’s speech allayed trade tensions, citing a more open Chinese market.


US equities gained, as the world listened to China. Chinese Pres. Xi Jinping’s statement to cut import tariffs & its commitment to widen market access for foreign investors supported Wall Street’s advance. DJIA +428pts, 24,408 (+1.8%), Nasdaq Comp. +143pts,7,094 (+2%).


Oil inches higher. Oil tracked strong gains after backpedaling of trade spat between U.S. and China, although concerns over U.S. production remain in the wake of higher weekly rig count. West Texas Intermediate (WTI) inched up $2.18 to $65.60/barrel.


SECB prepares P20bn LTNCD float:

Security Bank Corp. (SECB) got BSP’s clearance for the issuance of up to P20bn Long-Tern Negotiable Cert. of Time Deposits (LTNCDs) in one or more tranches over the course of a year. The first tranche worth P8.6bn was issued Nov. 8, 2017. The bank will tap the unissued P20bn & is intended to be issued 02 May 2018. This 2nd tranche will be offered 10-20 Apr. 2018.

DoTr rejected AEV unit’s airport proposal:

The Transportation bureau (DoTr) gave an official response to Aboitiz Equity Ventures, Inc. (AEV) unit Aboitiz InfraCapital, Inc. (AIC), on its adoption of publicly soliciting bids for the operations, maintenance, improvement & expansion of all airports under its fold. As such, DoTr cannot accept AIC’s proposal for Iloilo, Bacolod-Silay, Laguindingan & New Bohol Int’l Airport.

IMI unit formed Japan JV for copper-based metal mesh touch sensors:

Integrated Micro-Electronics, Inc. (IMI) unit, VIA Optronics GmbH, formed a new JV in Japan, that would serve the market for copperbased metal mesh touch sensors. The accord was with Toppan Printing Co. Ltd. that will involve the transfer of 65% of Toppan Touch Panel Products Co. Ltd. to VIA. The JV will be named VTS-Touchsensor Co. Ltd. (VTS). VIA will own 65% of VTS, 35% Toppan Printing.

ATI comments on issue over smuggling case filed against personnel:

Asian Terminals, Inc. (ATI) has not seen a copy of the reported smuggling complaint against several individuals including 2 ATI personnel. Reports showed that there was connivance in the illegal release of 105 shipping containers. Contract awarded to TUGS: Harbor Star Shipping Services, Inc. (TUGS) has received notice to proceed from one of the largest oil refining firms for the installation of their Bataan Main Pier Fender Frame & Piles Replacement. No further details were given on the marine project.

BHI cites impact of Boracay closure:

Boulevard Holdings, Inc. (BHI) gave notice that the closure of Boracay is negative for the firm, with losses at P35mn for the 7 months of April-Oct. 2018. The move has already caused P22mn in advanced deposit cancellations from customers in China & Germany.

Unit buys into IRC @P1.40/share:

IRC Properties, Inc. (IRC) & Aggregate Business Group Holdings, Inc. (ABG) entered into an agreement last 10 April 2018, where ABG bought 172.8mn common shares of IRC at P1.40/share, or P241.92mn. The shares will be taken from IRC’s unissued capital stock.


China pledges more aid:

During Pres. Duterte & China Pres. Xi Jinping’s bilateral meeting, China agreed to provide RMB500mn (P3.8bn) of additional assistance, on top of RMB500mn to be given by China. Pres. Spokesman Roque was cited, ‘There was an agreement to focus on stability & strengthening of communications to avoid untoward incidents in the West Phil. Sea…and that offshore oil dev’t. must continue.'

91D TBills up:

Treasury Bureau (BTr) awarded P5bn for 91-day TBills in its auction yesterday, bringing rates 15.5 basis points (bps) higher at 3.346%. Tenders amounted to almost P9bn. Bids for 6 mos. & 1year were rejected as rates were too high.

Mining review coverage expanded to other sites:

MICC plans to review 70 more mine sites in the country once it completes its review on the initial 26. This would depend however, on the budget that will be given to MICC. The bureau needs around P75mn more on top of the P25mn spent, or P1mn per mine site.









Philipines Market Insights 2018.4.6


Philipines Market Insights 2018.4.13