THE MORNING VIEW

THE MORNING VIEW


News Briefs
August 17, 2018
 

Local Key Events
  • Bangko Sentral ng Pilipinas (BSP) reported the foreign portfolio investment at USD959 Mn in July from USD911 Mn in the previous month, which they attributed to investors' anticipation of good corporate earnings. The bulk of the investment went to shares listed on the PSE, particularly banking, property, holding, food and beverage, and tobacco firms.
  • DMCI Mining Corporation, a subsidiary of DMCI Holdings, Inc. (PSE: DMC), recorded an 88% improvement in nickel shipments for 1H18. Majority of the shipments came from the old stockpiles of Berong Nickel Corporation (BNC) and Zambales Diversified Metals Corporation (ZDMC). DMCI Mining was able to ship more high-grade nickel ore at a higher selling price, as DENR allowed suspended mining companies to ship out their stockpiles to limit the possible accumulation of silt in nearby bodies of water.
Local Indices
  • The local equity index remained flat with a slight downward bias as investors remained cautious of the possible Turkey contagion, along with the net foreign outflows. The Philippine Stock Exchange index fell by 0.31% DoD to close at 7,517.36.
     
  • Local fixed income yields rose, particularly in the short-end of the yield curve, which may still be an impact of the recent aggressive monetary action of the Bangko Sentral ng Pilipinas. On average, yields increased by 15.47 bps.
     
  • The Philippine peso was flat with mild appreciation, amid the concerns over Turkey and US relations. The PHP/USD strengthened by 0.06%, ending at 53.44.
US and Europe Indices
  • US stocks recovered amid positive news about trade and positive revisions to corporate earnings expectations, especially relative to developed market peers. The S&P500 saw gains for all sectors, ending at 2,840.69 (+0.79 DoD), while the DJIA closed at 25,558.73 (+1.58% DoD).
  • European equities also showed some recovery, as rising metals prices, resulting from trade talks between the US and China, boosted the basic resources sector. The MSCI Europe closed at 128.49 (+0.45% DoD).
  • Yields of US Treasuries ended slightly lower as investors balanced reports of a possible resolution to the trade war in the form of US-China talks later this month with continuing risk of contagion from Turkey's currency crisis. On average, yields fell 0.06% DoD.
     
  • The US dollar ended slightly lower due to a strengthening in the Chinese yuan, which rose after reports that China had accepted a US invitation to trade talks later in the month. The DXY lost 0.05% DoD, closing at 96.645.
Asia Pacific Index
  • Asian equities continued their decline as fears over contagion on the Turkey issue continue to drive risk-off sentiment. The decline was despite renewed trade talks between China and the US. The MSCI APxJ Index closed at 519.36 (-0.29% DoD).
     
Sources: BPI, Business World, PDI, Phil Star, Manila Bulletin, Reuters, Briefing, Bloomberg, CNN, Dow Jones, The Wall Street Journal, CNBC
 

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