THE MORNING VIEW

THE MORNING VIEW


News Briefs
June 16, 2021
 
Local Key Events
  • Data from the Bangko Sentral ng PIlipinas reported that cash remittances from OFWs rose around 15% to $2.3 billion in April 2021 from $2.0 billion in the same month a year ago. This was the fastest growth recorded since November 2016 when cash remittances grew by 18.5%. The growth in cash remittances came largely from the United States, Malaysia, Singapore, and South Korea.
  • San Miguel Corp. (PSE Ticker: SMC) has been given the green flag by the Securities and Exchange Commission to offer up to Php50 billion in fixed rate bonds within the next three years. The first tranche will be a Php20 billion offering of six-year fixed-rate bonds due 2027, with an oversubscription option of Php10 billion. The proceeds will be used to finance existing dollar-denominated debt of SMC.
Local Indices
  • Local equities gained as the government eased quarantine restrictions. The government announced that restrictions in Metro Manila and Bulacan will be eased. The PSEi finished at 6,976.73 (+0.86% DoD).
  • Local fixed income yields declined after the Bureau of the Treasury fully awarded Php35 billion in reissued 10-year Treasury bonds yesterday. On average, yields fell by 0.61 bps DoD, led by the short-end of the curve which went down by 1.06 bps.
  • The Philippine peso weakened following  the local government’s decision to ease quarantine restrictions. Increased demand for the dollar may indicate that local firms are gearing up to purchase imported components for their production. The USD/PHP pair closed at 48.03 (+0.29% DoD).
US and Europe Indices
  • US equities declined on retail sales data logging below expectation and as investors were on wait-and-see mode ahead of the conclusion of the Fed policy meeting. US retail sales slipped by 1.3% MoM in May (expectation: -0.8%) indicating a possible shift in spending from “just goods” to “goods and services related to going out” as businesses reopen. The DJIA closed at 34,299.33  (-0.27% DoD) while the S&P 500 closed at 4,246.59 (-0.20% DoD).
  • European equities continued their uptrend as travel sector stocks led the rally, gaining 0.75% DoD amid expectations of a potential strong recovery in the second half of the year after lockdowns are eased. The MSCI Europe closed at 152.10 (+0.18% DoD).
  • US Treasury yields were mixed but increased on average amid weaker retail sales data, and as investors still await the results of Fed’s meeting for better indications on its policy. The market is particularly keen on discussions about tapering. On average, US Treasury yields went up by 0.24 bps DoD, with the 2Y ending at 0.16%  (+0.6 bps) and the 10Y ending at 1.49% (-0.18 bps).
  • The US dollar slightly strengthened as investors weighed weak retail sales data and waited for the outcome of the Federal Reserve’s policy meeting. The DXY closed at 90.54 (+0.02% DoD).
Asia Pacific Indices
  • Asian equities were mixed on Sino-West tensions. G7 leaders called for high autonomy of Hong Kong, which prompted China to accuse the leaders of interference in domestic affairs. The MSCI APxJ closed at 704.17 (-0.12% DoD).
     
 
Sources: BPI, Business World, PDI, Phil Star, Manila Bulletin, Reuters, Briefing, Bloomberg, CNN, Dow Jones, The Wall Street Journal, CNBC , Market Watch
 

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