Philippines Market Insights 2017.2.7


News Highlights: BDO Unibank, Inc. disclosed that the bank has complied with the requirements of the city government of Cebu. Meanwhile, the Bureau of Internal Revenue (BIR) aims to collect P1tn, 10% higher from the previous year's goal, from the Large Taxpayers Service (LTS).





Tracking Wall Street gains, PSEi @7,294: Local equities are on upbeat mode after US President Trump issued an executive order on deregulation of banks over the weekend, allowing Dow Jones to breach the 20,000 level mark. PSEi increased by 67 points at 7,294 (+0.94% day-on-day), with all sectors in positive territory, saved for mining/oil (-0.28%). Mining sectors loomed over the recent mining audit, leading to a series of closure and suspension orders. Actively-traded shares were: GTCAP (-P24 at P1,221); ALI (+P0.55 at P35.70); and ALCO (+P0.25 at P1.40), with P8.2bn turnover. Gainers outpaced losers, 97-91, while net foreign outflows reached P373mn.

Expectations might drive sentiment: Market might be swayed on today’s inflation report for January as the central bank (BSP) pegs inflation between 2.3%-3.2%. This is on the back of higher oil prices seemingly offsetting downward price pressures on rice and power-rates. Indications of higher inflation might construe less consumer spending, which in turn, might affect sectors such as consumer and retail stocks. Meanwhile, HOUSE would be reporting its full year performance later. Any indications from HOUSE would set the tone for other firms as they disclose their full year 2016 results and expectations for 2017. We might see some profit-taking, as most investors bank on results from local headlines before taking into large positions for today. Immediate support is 7,200, resistance at 7,340.


Better expectations lifted marts up: Most bourses ended higher as expectations of US growth weakened, making room for some money to drive back to emerging markets. Moreover, Japan's Nikkei seem to recover on its decline as bank stocks track on Wall Street gains.


Profit-taking for equities: Wall Street took a breather and opted to take profits as no economic data report was released on Monday. Dow Jones lost 19 points (-0.09%), while Nasdaq Comp. slid 3 points (-0.06%).


Oil down amid output concerns: Oil futures posted losses as concerns over rising US crude production and strength in US dollar seemed to erase gains. Moreover, news on US Pres. Trump’s notion to ease restriction on energy firms failed to provide much support on


BDO compliant with Cebu City's requirements: BDO Unibank, Inc. disclosed that the bank has complied with the requirements of the city government of Cebu. BDO has paid its local taxes and fees, but the city government has refused to accept the payments. The bank has apologized for the inconvenience among its affected clients.

Audiowav discloses Asian expansion plans: Audiowav Media, Inc., a firm that would be listing in the Exchange next month, disclosed its expansion plans to other Asian markets. The firm said that the proceeds from its planned P2.66bn initial public offering (IPO) would be used to enter Thailand, Vietnam and China in the 2Q and to infuse additional equity to existing subsidiaries in Singapore and Indonesia.

Eastern Petroleum files case over PPC unit: Eastern Petroleum filed a case against Pryce Gases Inc. for alleged unauthorized liquefied petroleum gas refilling. The resolution from the Provincial Prosecutor’s Office of Imus, Cavite confirmed their allegations of illegal LPG refilling and gives a legal cover to pursue a case against Pryce Gases. Pryce Gases, Inc. is a subsidiary of listed firm, Pryce Corporation (PPC).

PBB in talks on becoming PERA administrator: Philippine Business Bank (PBB) is looking to offer personal equity and retirement account (PERA) to its clients. The bank is mapping out its trust company and offer PERA among existing clients and SMEs. However, PBB needs stronger manpower operations to support the volume needed once it applies for PERA accreditation.


BIR targets P1tn from large taxpayers: The Bureau of Internal Revenue (BIR) aims to collect P1tn, 10% higher from the previous year's goal, from the Large Taxpayers Service (LTS). BIR collected P963bn from its LTS unit, contributing at least 62.4% of the revenue collection. For 2017, the LTS collection goal is 60% of the P1.83tn target of the BIR. The bureau will continue its Run After Tax Evaders (RATE) program, perform tax mapping, audit and field operations.

TransCo owes RE developers roughly P4bn: National Transmission Corp. (TransCo) said its total unpaid obligations to renewable energy (RE) developers under the feed-in-tariff scheme reached over P4bn. The delay was caused by the insufficiency of the P0.1240/kWh FiT allowance (FiT-All) to pay for the dues 5 months ago, translating to more or less P4bn. TransCo is currently collecting P0.1240/kWh from consumers under the FiT-All line item in the power bills. The rate will be increased to P0.2291/kWh, if approved by the Energy Regulatory Commission (ERC).









Philippines Market Insights 2017.2.6


Philippines Market Insights 2017.2.8