News Highlights: On the corporate front, Metro Pacific (MPI) through Metro Pacific Tollways Development Corp., raises its stake in Tollways Management Corp., the operator of North Luzon Expressway, Subic-Clark-Tarlac Expressway and Manila-Cavite Expressway. Meanwhile, government deficit in November surged to P19.1bn as expenditures jumped 33%, which outpaced the 18% growth in revenue collection.
|91-day||1.484||+20.3||8.0||Gold Spot (USD)||1,141.67||2.89||+0.25||Close||49.82|
|364-day||-||N.A.||6.0||WTI Crude (USD/bbl)||54.06||0.16||+0.30||Low||49.77|
Mart sustained rally, PSEi @6,846: Local mart continued its rally, tracking US gainsdespite the thinly-traded session as New Year holiday approaches. PSEi rose by 188points to close at 6,846.44 (+2.83% day-on-day), with all sectors posting gains, led by holding (+3.09%). Among actively-traded shares were: ALI (+P1.55 at P31.70); AC (+22.00 at P732.00); and MPI (+P0.12 at P6.50), on P3.45bn turnover. Gainers outnumbered losers at 119-58, with net foreign buying at P269mn.
Mart might trade higher: Local bourse will try to continue rally in an attempt to pare losses for 2016. Despite the slim chance, PSEi will try to break even and must add 106 points to avoid closing for the second straight year on a loss. Immediate support at 6,720, resistance 6,950.
Most marts higher after tracking US gains: Bourses across the region ended mixed, with most marts inching higher amid US overnight gains.
Equities lower on the lack of leads: Equities declined on the absence of market catalysts. Dow Jones shed 111 points, its second triple digit loss since the election.
Crude up on output cut optimism: Oil futures extended gains for the fourth consecutive session as market awaits the 01 January 2017 output cut agreement to take effect. West Texas Intermediate for February added $0.16 to close at $54.06/barrel.
MPI unit hikes stake in tollway operator firm: Metro Pacific (MPI) through Metro Pacific Tollways Development Corp., raises its stake in Tollways Management Corp., the operator of North Luzon Expressway, Subic-Clark-Tarlac Expressway and Manila-Cavite Expressway. MPTDC acquired 53,200 common shares from Egis Road Operation S.A., translating to 14% of the total issued purchase price and outstanding capital stock of TMC. Prior to the transaction, MPTDC already owns 46% of TMC shares. The price for the acquired shares was paid in cash.
SM received 18 awards for energy efficiency: SM Investments (SM) received 18 awards for its energy efficiency initiatives from the Energy Department's Don Emilio Abello Energy Efficiency Awards for 2016. SM awardees included Cyber Makati 1 (hall of fame) and SM City Iloilo, SM City North EDSA (Annex), The Podium, Mall of Asia and Cyber Makati 1 (outstanding awards).
MER in talks with Japanese firm for billing system: Manila Electric Co. (MER) is in talks with a Japanese firm for its potential reinforcing of its billing systems. Japanese firm initially eyes minority equity in MER’s corporate vehicle handling its Bayad Center or its bills payment system. Reports hinted that it is Densan Co. Ltd., a leading integrat ed payment solution provider in Japan. However, the prospective Japanese partner would still have to go back to its board to secure approval before advancing into firmer partnership deal with MER.
JFC unit won against BIR's tax assessment: Jollibee Foods (JFC) unit Fresh N' Famous was granted by the CTA Third Division on its petition to reverse the BIR's decision dated 17 August 2010 regarding the company's tax deficiency amounting to P125mn for the taxable year 2000. The breakdown of BIR's assessments are as follows: income tax deficiency of P97.10mn, VAT deficiency of P2.46mn, EWT deficiency of P20.55mn, documentary stamp tax deficiency of P4.28mn and P460k, and compromise penalty of P41k. The CTA concluded that BIR has no valid notice of assessment sent to JFC, including the assessment against the petitioner for its alleged tax liabilities for taxable year 2000.
Deficit reached P19.1bn in November: Government deficit in November surged to P19.1bn as expenditures jumped 33%, which outpaced the 18% growth in revenue collection. Spending surged 33% to P228.357bn, marking the biggest monthly expenditure, so far, this year versus the revenue collection amounting to P209.212bn. This brought the total budget shortfall in the first 11 months to P235.2bn. Recall that under the Duterte administration’s economic blueprint, GDP growth is targeted to speed up to 7%-8% annually from 2018-2022 from 6.5%-7.5% in 2017 and from 6%-7% this year, helping to trim poverty rate to 13%-17% in 2022 from 2015’s actual 21.6%.
Term deposit facility undersubscribed: The P180bn term deposit facility was undersubscribed amid seasonality and cautiousness from market players according to the central bank (BSP). Total tenders for the weekly volume of P180bn reached just P148.839bn. The month-term auction attracted only P111.0333bn against the P150bn allotment, while the 7 -day term, however, was oversubscribed, with total tenders of P37.806bn.
3% unemployment rate target by 2022: The government targets cutting unemployment rate to 3% within the Duterte administration. Labor Force Survey conducted by PSA showed that annual unemployment rate dropped to 5.5% from 2015’s 6.3%, translating to about 2.39mn Filipinos unemployed for the year 2016. Therefore, the government needs to generate at least 12mn jobs before 2022 to achieve the employment target.
BoI approves housing project: The Board of Investments (BoI) approved the application of Schmidt Konstruktion Systems Corp. as a new domestic producer of modular housing components amid its compliance to the requirements under the current Investment Priorities Plan (IPP). The P13.7mn project covers the development of economic and low-cost housing and the manufacture of modular housing components.