News Highlights: Apple’s climb (+3%) after its capitalisation reached the trillion dollar threshold led tech sector higher. On the local front, members of the House of Rep. Ways & Means approved in principle, package 2 of the tax reform (TRAIN) that provides for one percentage point cut in the current 30% corp. tax each year starting 2019, provided this won’t go below 20%.
Mart corrects, PSEi @7,759: Profit-takers seized the bourse’s recent advance, pulling gauges 78 points weaker at 7,759 (-1%). Selling dominated services (-1.23%) & holdings (-1%). Those that led actively-traded decliners were: JGS (-P1.50 at P55.80); ALI (-P0.70 at P41.25); BDO (-P1.30 at P135.50); & SMPH (-P0.10 at P37.90). Only a handful rose: MPI (+P0.15 at P5); TBGI (+P0.03 at P0.57); & MBT (+P0.30 at P73.30). Turnover receded to P4.48bn (-52% d-o-d), as market breadth favoured losers, 120-76. Net foreign selling was P242mn.
Selective play: Equities players will check if the market would resume its correction, given its recent ascent & announcement of July inflation early next week. Monitor will be made on turnout, as well as results of net foreign trades. Meanwhile, some might ride on news over package 2 of the tax reform covering reduced corporate income taxes. Immediate support is 7,670-7,700, resistance 7,800.
Marts ended lower: Asian stocks were beaten on Wednesday following the latest U.S.-China trade developments and weighed by weakness on China market.
US tech shares rallied: Apple’s climb (+3%) after its capitalisation reached the trillion dollar threshold led tech sector higher. DJIA -7 points, 25,326 (-0.03%), Nasdaq Comp. +95pts, 7,802 (+1.24%).
Oil prices rose: Oil futures ended higher Thursday, as data reportedly showing a drop in stockpiles at the domestic delivery hub at Cushing, Okla., and also on growing global crude output and a surprise climb in domestic supplies. West Texas Intermediate (WTI) rose $1.30 to $68.96/barrel.
Logistics unit of MPI expands in Cavite & Bulacan:
Metro Pacific Investments Corp. (MPI)’s Metropac Movers (MMI) acquired over 200k sqm. lot in Cavite that will be developed to 141k sqm. covered warehouse space. MMI also plans to buy another 300k sqm. lot in Bulacan to build its logistics services. Volume handled in 1H18 stood at 31.6mn cases (+12%). Meanwhile, MMI completed its purchase of 12% in Air21 which may be raised to 100% in the future.
Tollroad investment dependent on tariff approval:
Metro Pacific Investments Corp. (MPI)’s MPTC sees spending P122.7bn in the next 5 years to build tollroads. The amount would rise by P25bn more, if MPTC were to secure the Cavite-Tagaytay-Batangas Expressway for which it was recently awarded Original Proponent status. The investment however, assumes satisfactory resolution of various overdue tariff adjustments, ranging 20%-48% on various parts of the network, without which, further investment will be delayed.
Package 2 of TRAIN cleared in principle:
Members of the House of Rep. Ways & Means approved in principle, package 2 of the tax reform (TRAIN) covering corporate taxes. The bill provides for one percentage point cut in the current 30% corp. tax each year starting 2019, provided this won’t go below 20%. The committee will have a technical working group to create a substitute bill.
Mining firms hopeful on results of talks with DENR head:
PX chief Eulalio Austin said the meeting with DENR Sec. Cimatu was a good venue to educate the Sec. on right & principled mining. He added that there is hope for open pit & the MICC results would need to be discussed with concerned parties first.
Royalty on mining proposed under TRAIN 2+:
DoF proposed royalty on mining contractors for all metallic & nonmetallic mining under the proposed tax package 2 Plus (2+). At present, royalty is imposed only on mine sites declared as mineral reservations. For operations outside mineral reservations, 3% royalty was proposed for the first 3 years, 4% for the 4th & 5% on the 5th year. For those within mineral reservations, royalty will be 5% of the market value of gross output.
New ERC Commissioners to be named soon:
Unnamed sources claimed the Palace might name Davao-based Alexis Lumbatan & RE advocate Catherine P. Maceda will replace 2 ERC Commissioners who retired recently. Devanadera stressed the new people cannot start from a learning curve that takes off from an elementary phase & priority must be set on old pending cases. No official statement was released by the Palace on the matter.