Philippiness Market Insights 2016.12.22


News Highlights:Globe Telecom (GLO) has installed 500 LTE cell sites using the 700MHz spectrum.  Meanwhile, the Department of Labor and Employment (DOLE) is expected to release on December 28 Department Order 30 (DO 30), a new set of guidelines on contractual labor.


T-Bill     14Nov'16 Rate % Bps Chg. Vol


  Commodities 21 Dec Abs. Chg. % Chg   Forex Value
91-day 1.484 +20.3 8.0 Gold Spot (USD) 1,131.61 (0.74) (0.07) Close 50.00
182-day 1.809 +30.4 6.0 Copper (USD/lb) 249.70 (0.55) (0.22) High 50.00
364-day - N.A. 6.0 WTI Crude (USD/bbl) 52.49 (0.81) (1.52) Low 49.95
  Ave 49.98
Total 20.0   Vol (US$mn) 421.00


21Dec Abs. Chg % Chg
PSEi 6,686.36 27.70 +0.42
All shares 4,086.44 13.59 +0.33
Financials 1,638.54 18.82 +1.16
Industrial 10,537.57 (19.75) (0.19)
Holding 6,815.55 22.58 +0.33
Services 1,277.20 19.41 +1.54
Mining and Oil 12,048.93 80.53 +0.67
Property 2,979.17 (7.11) (0.24)
Total volume-mn 916.63 (905.87) (49.70)
Total value-Pmn 5,281.83 (1,495.30) (22.06)
Net foreign Buy (Sell)-Pmn (756.41) 610.73 (44.67)
Jakarta (Composite) 5,111.39 (51.09) (0.99)
South Korea (KOSPI) 2,037.96 (11.90) (0.58)
Taiwan (Weighted) 9,204.26 (38.15) (0.41)
Singapore (Straits Times) 2,901.70 (9.61) (0.33)
Malaysia (KLCI Comp) 1,629.59 (4.93) (0.30)
Japan (Nikkei 225) 19,444.49 (50.04) (0.26)
Thailand (SET) 1,508.57 (3.08) (0.20)
Hong Kong (Hang Seng) 21,809.80 80.74 +0.37
Philippines (PSEi) 6,686.36 27.70 +0.42
Shenzhen (SE Comp.) 1,996.03 14.71 +0.74
Shanghai (CSI 300) 3,338.54 29.48 +0.89
Dow Jones 19,941.96 (32.66) (0.16)
Nasdaq Comp. 5,471.43 (12.51) (0.23)
S&P 500 2,265.18 (5.58) (0.25)
Sun Life (SLF:US) 39.09 (0.16) (0.41)
PLDT(PHI:US) 26.74 0.38 +1.44



Bargain hunt after slump, PSEi @6,686:Local equities rallied on Wednesday as the recent slump encouraged investors to bargain hunt.  PSEi closed 27 points higher to 6,686 (+0.42% day-on-day), with sectors ending mixed favoring gainers.  Among actively-traded shares were:  SM (-P6 at P618); MPI (+P0.25 at P6.31); and AC (-P2 at P713) on P5.3bn turnover.  Market favored gainers, 109-49, on net foreign outflows of P756mn.

Bargain hunt might continue:Market might continue its hunt for bargain stocks to accumulate gains and positions before the holidays. We are expecting the market to rally as players try to seize opportunities from stocks that are high likely to be profitable.  Otherwise, we see volume to be minimal today ahead of the holiday season.  Immediate support, 6,650, resistance 6,730.


Marts mixed:Bourses ended mixed after US Tuesday’s overnight record-high performance.  Meanwhile, Japan’s central bank (BoJ) issued a statement that they see no problem from yen’s recent declines against the dollar.


Dow Jones’ 20,000 breach still elusive:Shares closed lower, with Dow Jones (DJIA) has yet again eluded the 20,000 benchmark.  Trading was also seen to have thinned out amid the holiday season.


Oil retreated amid stockpiles addition:Oil futures lost its momentum after the new data from US Energy Information Administration (EIA) showed increasing imports causing an addition of stockpiles.  Crude stockpiles grew by 2.3mn barrels last week, in which most have expected that big of a decline. Net imports grew by 1mn barrels to 7.9mn in total. West Texas Intermediate for February lost $0.81 at $52.49/barrel.


GLO installs 500 LTE sites using 700MHz:  Globe Telecom (GLO) has installed 500 LTE cell sites using the 700MHz spectrum. GLO also said that it is on track to deploy about 4,500 multi-band, multi-mode software-defined radio station equipment to 95% of cities and municipalities within 3 years.

MER sees 8% growth in sales:Manila Electric (MER) sees sales volume for distribution utility to grow 8.1% in 4Q at 39,600GWh. MER unit, Clark Electric Distribution is set to add 500GWh, exceeding 40,000GWh consolidated.

Four power companies bid for 650MW Malaya Thermal Power Plant: The Power Sector Assets and Liabilities Management Corp. (PSALM) has closed the deadline for submission of letters of interests and it received four bids for the project. The interested parties are: APT Global Inc., Phinma Energy Corp. (PHEN), Riverbend Consolidated Mining Corp. and AC Energy Holdings Inc. PSALM will conduct the bidding on 8 March 2017. The Malaya Thermal Power Plant consists of a 300MW unit and a 350MW unit with a traditional boiler.

Sy-Tieng group to pursue Sangley airport rehab: A consortium backed by Wilson Tieng and Henry Sy still wants to pursue the rehabilitation plan on Danilo Atienza Airport in Sangley, Cavite. The plan was formed to reduce congestion in NAIA and to reclaim 2,500ha in Sangley to build an international airport, seaport and industrial zone, named Philippines Global Gateway. The reclamation project will cost around P1bn, while the bigger Philippines Global Gateway has a P1.3tn estimated budget from Tieng's All-Asia Resources and Reclamation Corp. and Belle Corp. (BEL) of Henry Sy.

RFM sells more treasury shares:  RFM Corporation (RFM) has sold another 3mn treasury shares for P4.90/sh. or a total value of P14.7mn. The shares represent for less than 1% of the listed shares of RFM, thus, public float barely changed at 48.55%. RFM has 17,000 shares left in treasury.

BC received a show cause letter from DENR: Benguet Corp. (BC) has received a show cause letter from the Environment Department (DENR) regarding the tailings spill incident last 27 October in Antamok mine. BC is given 7 days from the receipt of the letter to explain why the company should not be suspended from mining operations.


BSP records P15.26bn income from Jan-Oct: The Bangko Sentral ng Pilipinas (BSP) recorded an all-time high profit of P15.26bn, reversing the P4.41bn loss from the same period last year. The record profit is mainly attributed to BSP's higher revenues and higher gains on forex operations. Revenues increased by 30% from P47.9bn to P62.3bn, while forex gains reached P11.4bn for the first ten months.

28-day TDFs remain undersubscribed: BSP capped the rates for the 28-day term deposits as concerns regarding the next Fed rate hike rise. The 28-day auctions remained undersubscribed at bids reached only P137.46bn for the P150bn offering. Rate for the 28-day term deposits (TDs) is at 3.4317%. Meanwhile, the 7-day TDs remain oversubscribed as the P30bn offering received P64.5bn bids. The 7-day TDs will fetch a yield of 3%. BSP will retain the P180bn volume for TDFs until 4 Jan 2017.

Order against contractualization will be released on Dec 28:The Department of Labor and Employment (DOLE) is expected to release on December 28 Department Order 30 (DO 30), a new set of guidelines on contractual labor. DO 30 will address the ‘end of contract’ or ‘ENDO’ issue. This new DO will also remove subcontracting.

Bureau of Customs exceeded November collection target:The Bureau of Customs has exceeded its collection target in November. It raised P40.24bn, +27% YoY and better than the 23% growth recorded in August, which was then the fastest year-to-date.