THE MORNING VIEW

THE MORNING VIEW


News Briefs
February 15,2019

Local Key Events
  • According to Palace officials, the rice tarrification bill will likely lapse into law today with no definitive Presidential action to either sign or veto the bill. Spokesman Salvador Panelo said that the bill will likely not be vetoed. The public remains divided on the issue, with farmers' groups pushing for a veto, and business and economic groups pushing for it to enter into law.
     
  • Bloomberry Resorts Corp. (PSE Ticker: BLOOM) secured Php 40 billion in funding from a syndicate of local banks. The funds will be used to complete a new gaming hub at Vertis North in Quezon City, which will be the company's second integrated hotel and gaming resort. The largest lenders were PNB (Php 11.5 billion) and BDO (Php 10.0 billion). BLOOM will be added once again to the Philippine Stock Exchange Index, replacing Petron Corporation, on February 18.
Local Indices
  • The local equities market slightly rose, with net foreign buying amounting to $4.82 million, driven by risk-on sentiment from US-China trade deal and better-than-expected US core CPI for January. The PSEi closed at 7,991.25 (+0.90% DoD).
     
  • Local fixed income yields rose alongside Term Deposit Facility rates, which rose at yesterday's auction. All three TDF terms saw bids exceeding the offered volumes, but rates nevertheless rose, reflecting investor expectations for supply-demand dynamics. On average, the curve rose by 0.53 bps.
     
  • The Philippine Peso weakened as US inflation came out stronger than expected at 1.6% in January. The USD/PHP pair closed at 52.38 (-0.48% DoD).
US and Europe Indices
  • US equities retreated even after the passing of a new spending bill that aims to avert another government shutdown. Weak December 2018 retail sales and reports that President Trump will declare a national emergency to fund his promised border wall weighed down the market. The DJIA closed at 25,439.39 (-0.41% DoD), while the S&P 500 ended at 2,745.73(-0.27% DoD).
     
  • European stocks tracked losses of global peers despite Germany avoiding a technical recession after it showed positive GDP growth in 4Q18. Meanwhile, UK PM Theresa May lost another round Brexit vote in Parliament casting doubts on what to do next. The MSCI Europe ended at 122.94 (-0.41% DoD).
     
  • US Treasury yields reversed and declined as reports came out that President Trump will declare a national emergency to fund his proposed border wall. On average, yields fell 3.05 bps, with the 10-year falling 4.85 bps to 2.6536%.
     
  • The US Dollar similarly fell as weaker US retail sales data came out. The DXY ended at 96.9780 (-0.16% DoD).
Asia Pacific Index
  • Asian stocks declined after a news broke out that the US and China are still far apart on structural issues regarding trade. The MSCI APxJ closed at 515.39 (-0.17% 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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