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Subject: BPI Asset Management: THE MORNING VIEW


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THE MORNING VIEW

News Briefs
March 19, 2019

Local Key Events
  • International Container Terminal Services, Inc. (PSE ticker: ICT) is considering acquiring the assets of  Hanjin Heavy Industries Construction Philippines to convert these into a multipurpose facility,  possibly for power, steel, ship repair, automotive, crane, multipurpose.
     
  • Latest data from the Bureau of Treasury (BOTr) revealed that the national government posted a budget surplus in January this year to P10.2 billion, widening 337% YoY. This resulted as disburements on public goods and services declined due to a reenacted budget while revenues grew after the second tranche of tax increases mandated under the Tax Reform for Acceleration and Inclusion (TRAIN) Act. Revenues rose 7% YoY to Php256.7 billion while government expenditures fell 7% YoY to Php212.2 billion last month.
Local Indices
  • The local equities market rose ahead of Bangko Sentral ng Pilipinas and US Federal Reserve policy meetings scheduled for this week. The PSEi closed at 7,873.02 (+0.96% DoD).
     
  • Local fixed income yields continued to decline amidst a partial award of T-Bills on offer. The BTr raised just P13.4 billion out of the planned P20 billion as significantly lower demand was seen among investors. On average, the yields fell 1.29 bps, led by the long end which fell 5.29bps.
     
  • The Philippine Peso closed flat against the dollar amidst a perceived strong appetite for the US Dollar despite its expected weakening against other currencies in the region on dovish expectations ahead of the BSP's policy meeting. The USD/PHP pair closed at 52.65 (0.00% DoD).
US and Europe Indices
  • US equities mildly rose, led by the outperformance in Amazon and Apple, while Beoing shares dragged the indices. Reports mention that the Department of Transporation scrutinized the development of Boeing's 737 Max planes following the recent crashes. The DJIA closed at 25,914.10 (+0.25% DoD) while the S&P500 ended at 2,832.94 (+0.37% DoD).
     
  • European stocks closed higher with gains led by the banking sector as Germany's largest lenders confirmed that they had merger talks over the weekend. The MSCI Europe closed at 129.01 (+0.30% DoD).  
     
  • US Treasury yields rose ahead of the kick-off to the Federal Reserve's 2-day meeting. While rates are expected to be unchanged, attention will be on Fed statements regarding US economic growth. On average, yields rose by 0.80bps, with the 10-year increased by 1.62bps to 2.6033%.
     
  • The US Dollar  remained sluggish as market participants anticipate a dovish outlook from the Federal Reserve  in the FOMC meeting later this week. The DXY slightly fell to 96.524 (-0.07% DoD).
Asia Pacific Index
  • Asian stocks rose ahead of the US Federal Reserve policy meeting. Investors also weighed reports that China's congress endorsed a law that prohibits forced technology transfer which is one of the major issues of the US with China. The MSCI APxJ closed at 530.03 (+1.00% DoD).
     
Sources: BPI, Business World, PDI, Phil Star, Manila Bulletin, Reuters, Briefing, Bloomberg, CNN, Dow Jones, The Wall Street Journal, CNBC
 

This material, which is strictly for information purposes only, is for your sole use, does not constitute a recommendation or an offer to sell or a solicitation to buy any financial product. Any information is subject to change without notice and BPI is not under any obligation to update or keep current the information contained herein. You are advised to make your own independent judgment with respect to the matter contained in this document. No liability whatsoever is accepted for any loss that may arise (whether direct or consequential) from any use of the information contained herein.

All funds managed by BPI Asset Management and affiliates are Trust and/or Investment Management Funds, which do not carry any guarantee of income or principal, and are NOT covered by the Philippine Deposit Insurance Corporation. Past performance is not a guarantee of future results. BPI Investment Funds are valued daily using the marked-to-market method.

 
 
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