PHILIPPINE manufacturing expanded for a 14th month in a row in October, but the pace of growth slowed month on month amid a softer rise in new orders and output, S&P Global said on Monday. Read the full story.
Here’s a quick glance at how PSEi stocks fared on Monday, November 4, 2024.
PHILIPPINE STOCKS dropped further on Monday as investors await the outcome of the US presidential election and the release of key Philippine economic data this week.
The benchmark Philippine Stock Exchange index (PSEi) declined by 0.09% or 6.86 points to close at 7,136.10, while the broader all shares index went down by 0.14% or 5.55 points to end at 3,951.66.
This was the PSEi’s lowest close in seven weeks or since Sept. 16’s finish of 7,104.20.
“The local market closed lower this Monday. Investors maintained a cautious stance while waiting for crucial economic data to be released this week, as well as the US’ upcoming presidential elections,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.
“Investors are taking into consideration expectations of higher inflation in October and a slowdown in gross domestic product (GDP) growth in the third quarter. Foreigners were still net sellers, adding to the market’s challenges,” he added.
The Philippine Statistics Authority will release October inflation data on Tuesday (Nov. 5) and third-quarter GDP data on Thursday (Nov. 7).
A BusinessWorld poll of 11 analysts yielded a median estimate of 2.4% for the October consumer price index. This would be faster than the 1.9% print in September but slower than 4.9% in the same month last year.
Meanwhile, a separate BusinessWorld poll of 12 analysts yielded a median GDP growth estimate of 5.7% for the July-to-September period, which would be slower than the 6.3% growth in the previous quarter and the 6% expansion in the third quarter of 2023.
“Philippine shares traded as the market focus intensifies on key US events, with investors keeping a close watch on the Nov. 5 elections and the Federal Reserve’s policy meeting. Any indications from the Fed regarding future rate adjustments could shape market sentiment,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
The Fed will hold its policy meeting on Nov. 6-7. Markets widely expect the US central bank to cut rates by 25 basis points.
Majority of sectoral indices declined on Monday. Mining and oil retreated by 1.93% or 167.12 points to 8,487.19; property dropped by 1.34% or 37.60 points to 2,755.97; financials went down by 0.89% or 20.78 points to 2,311.09; and industrials decreased by 0.23% or 22.63 points to 9,827.98.
Meanwhile, holding firms rose by 0.99% or 60.16 points to 6,097.06, and services climbed by 0.88% or 19.17 points to 2,190.76.
Value turnover dropped to P4.65 billion on Monday with 588.45 million shares changing hands from the P5.43 billion with 803.18 million issues traded on Thursday.
Decliners outnumbered advancers, 107 versus 76, while 58 names were unchanged.
Net foreign selling went down to P777.98 million on Monday from P1.31 billion on Thursday. — R.M.D. Ochave
THE PESO depreciated to a three-month low against the dollar on Monday ahead of the results of the US presidential elections and amid an expected uptick in domestic inflation last month.
The local unit closed at P58.34 per dollar on Monday, weakening by 24 centavos from its P58.10 finish on Thursday, Bankers Association of the Philippines data showed.
This was its worst finish in over three months or since it closed at P58.365 on July 31.
The peso opened Monday’s session sharply weaker at P58.27 against the dollar. Its intraday best was at P58.15, while its worst showing was at P58.36 versus the greenback.
Dollars traded declined to $1.18 billion on Monday from $1.3 billion on Thursday.
The market was closed on Friday (Nov. 1) for All Saints’ Day.
“The peso weakened anew, driven by safe-haven demand for the greenback ahead of the US elections this week,” a trader said in an e-mail.
The dollar slid on Monday as investors braced for a potential pivot this week for the global economy as the United States chooses a new leader, and as it likely cuts interest rates again with major implications for bond yields, Reuters reported.
The dollar fell 0.6% on the yen to 152.60. The dollar index eased 0.1% to 103.80.
US Treasury yields dropped 5 basis points (bps), retracing some of Friday’s surge.
Democratic candidate Kamala Harris and Republican Donald Trump remain virtually tied in opinion polls and the winner might not be known for days after voting ends.
Analysts believe Mr. Trump’s policies on immigration, tax cuts and tariffs would put upward pressure on inflation, bond yields and the dollar, while Ms. Harris was seen as the continuity candidate.
Dealers said the dip in the dollar might be linked to a poll that showed Ms. Harris taking a surprise 3-point lead in Iowa, thanks largely to her popularity with female voters.
Uncertainty over the outcome is one reason markets assume the Federal Reserve will choose to cut rates by a standard 25 bps on Thursday, rather than repeat its outsized half-point easing.
Traders have fully priced in a quarter-point cut to 4.5%-4.75%, and an 83% probability of a similar-sized move in December.
The peso weakened due to expectations of an uptick in October inflation, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort added in a Viber message.
The Philippine Statistics Authority will release October inflation data on Tuesday (Nov. 5).
A BusinessWorld poll of 11 analysts yielded a median estimate of 2.4% for the October consumer price index, within the central bank’s 2-2.8% forecast for the month.
If realized, this would be faster than the 1.9% print in September but slower than 4.9% in the same month a year ago.
For Tuesday, the trader said the peso could depreciate further with the release of the October inflation report.
The trader sees the peso moving between P58.25 and P58.50 per dollar, while Mr. Ricafort expects it to range from P58.25 to P58.45. — AMCS with Reuters
PHILIPPINE President Ferdinand R. Marcos, Jr. on Monday defended his government’s flood infrastructure after the country was battered by two storms that hit almost 9 million Filipinos and caused major flooding in many cities.
“We have flood control systems, but these were just really overwhelmed,” he told reporters in mixed English and Filipino on the sidelines of his visit to Laurel town in Batangas province south of the capital Manila, vowing to build a system that can withstand climate change’s worse effects.
“They didn’t withstand it (Severe Tropical Storm Trami) because it was the first in Philippine history. We only experienced it now,” he added.
Trami, locally named Kristine and which Greenpeace Philippines dubbed as the “third-[most] highly devastating weather event to batter the country this year,” killed at least 59 people in Batangas province, 20 of whom were buried in a landslide in the municipality of Talisay, which Mr. Marcos also visited.
The National Disaster Risk Reduction and Management Council said in a morning report on Sunday the death toll from Trami, which made landfall in the Philippines on Oct. 24, and Super Typhoon Kong-rey had reached 146.
It said 8.63 million people from 2.2 million families had been affected. More than 200,000 people from 56,396 families were staying in 467 evacuation centers, it added.
Mr. Marcos admitted that his government’s response to the storms was “never enough.” “I’ll tell you the truth, it’s never enough, it’s never enough. I wish we could do more.”
“We are doing everything that we can, but you know when you lose a life, you lose a life, what can you do about that? It’s a terrible tragedy,” he added.
The President noted that the country did not expect it would be hit by a storm as powerful as Trami, which he said dumped more rains than Ketsana (Ondoy), which submerged parts of Metro Manila and killed more than 200 people in 2009 as it dumped more than 400 millimeters of rain.
In contrast, Kristine dumped about 700 millimeters of rain — almost double that of Ketsana — he said, as he defended the country’s flood infrastructure from criticisms.
“Our flood-control projects were designed to withstand flood waters caused by storms like Ondoy,” he said in Filipino. “Those landslides were new, they didn’t happen in their entire lives, in the history of areas that faced landslides due to high levels of water.”
Mr. Marcos reiterated that the record-breaking flood levels experienced by the Philippines were highly attributable to climate change. “We are now seeing the climate change that we have been talking about.”
In response to the President’s remarks, Greenpeace Philippines campaigner Khevin A. Yu told BusinessWorld: “Extreme weather events are nothing new for the Philippines as we have been the most affected country by climate change for decades.”
“Damage is inevitable due to the worsening nature of the climate crisis. As the new chairman of the Loss and Damage Fund (LDF), President Marcos should start demanding payment for our loss and damage during Super Typhoon Kristine from the culprits of the climate crisis,” he added.
Before Trami, the Philippines in July was hit by Typhoon Gaemi, killing dozens and submerging parts of the capital region and nearby provinces in floodwaters.
‘FIRST TIME’
The country has been facing stronger typhoons through the years. On Nov. 8, it will commemorate the devastation of Super Typhoon Haiyan (Yolanda), which killed more than 6,000 Filipinos mostly in the central Philippine province of Leyte in November 2013.
Mr. Marcos said critics of the government’s flood-control infrastructure should also look at what is happening in other countries such as Spain, where more than 200 people died in a major flood in the Valencia region.
“Look, it’s not only here. Have you seen what happened to Spain? Have you seen what’s happening in various countries, in the States?” he asked, noting that these events are happening for the first time.
A Reuters report showed survivors of the deadly flooding in Valencia, Spain protesting during a visit by Spanish King Felipe, Queen Letizia and Prime Minister Pedro Sanchez, “with some throwing mud at them.”
Mr. Marcos cited the need to change the design of public infrastructure including flood-control projects, slope protection facilities and bridges. “Let’s look for a better design.”
The Philippines has been chosen to head the board of the LDF, a United Nations financing mechanism that will benefit countries vulnerable to climate change, including the host-country itself.
The election followed efforts by the Marcos government to promote the Philippines as a country that is committed to the global green transition, despite the slow phase-out of dirty sources of energy and policies that green groups say are anti-environment.
Mr. Marcos has branded himself as a climate leader, citing the need for sustainable practices, and even touting the presence of wind mills in his home province of Ilocos Norte in northern Philippines.
Asked whether the government would impose a moratorium on development projects amid the worsening effects of typhoons, Mr. Marcos said: “That’s always been the problem, but it has not been as severe as it is now. And again, it’s climate change.”
“It’s something that has never happened before and it is something that we have to deal with. There’s no other way,” he said. “We have to be smarter. We have to be more technologically aware of what is available so that we can reduce the effects.”
During Mr. Marcos’ visit to Batangas, the Department of Human Settlements and Urban Development distributed housing materials worth P6 million donated by the Metrobank Foundation Inc. to victims.
About 150 families from Talisay town and 200 families each from the municipalities of Laurel and Agoncillo received home materials and essentials from the agency and its partners, it said in a statement. Each package was composed of GI roofs, marine plywood, lumber and nails, which will be used to repair damaged houses.
The Office of the President also gave P10,000 each to 4,378 beneficiaries in the municipalities of Agoncillo, Laurel and Talisay.
The Philippines remained the most disaster-prone country for the 16th straight year in the World Risk Index, which assesses the disaster risk for 193 countries using 100 indicators.
The Philippines lies along the typhoon belt in the Pacific and experiences about 20 storms each year. It also lies in the so-called Pacific Ring of Fire, a belt of volcanoes around the Pacific Ocean where most of the world’s earthquakes strike. — Kyle Aristophere T. Atienza
A BILL that seeks to mandate a health- and human rights-based approach in solving the Philippines’ illegal drug problem was filed at the House of Representatives on Monday.
The proposal would make the government’s anti-drug campaign rehabilitative and humane compared with ex-President Rodrigo R. Duterte’s dead drug war that killed thousands of drug suspects, Party-list Rep. Percival V. Cendana said in a statement.
“The ‘Kian bill’ prevents the killing of more innocent people,” he said, referring to House Bill No. 11004. Mr. Cendana named the measure after Kian Loyd de los Santos, a teenager whom police murdered during an anti-drug sting in 2017.
“Instead of violence and bullets, our solution is to provide appropriate treatment and direct care to drug users,” he added.
The Philippine government estimates that more than 6,000 died under the campaign, according to a Facebook infographics published in June 2022 by RealNumbersPH, which is operated by the inter-agency Committee on Anti-Illegal Drugs. Human rights groups say the death toll could be as high as 30,000.
The measure requires the Health department to coordinate with local governments in setting up community-based health and social support programs for drug users. “The program shall be based on strong evidence of effectiveness according to scientific, medical research and practice.”
Drug users should also be given access to assistance in a “comprehensive, nonjudgmental, nondiscriminatory manner,” according to the House bill. Authorities should develop and disseminate education materials to raise public awareness about drug abuse.
Law enforcers should not arrest or detain suspected drug users and should instead refer them to community-based facilities. They will be exempted from criminal, civil and administrative liabilities after seeking treatment for drug addiction.
“No drug policy, program, or practice should have the effect of undermining or violating the dignity of any persons,” according to the bill.
Mr. Duterte last month said he offers “no apologies, no excuses” for his war on drugs, as he appeared for the first time at a Senate hearing probing the crackdown.
“Do not question my policies, because I offer no apologies, no excuses. I did what I had to do, and whether you believe it or not, I did it for my country,” he told senators.
He also admitted having told cops when he was still Davao City mayor to goad drug suspects to draw their guns and fight back to give cops a reason to retaliate.
During the hearing, Mr. Duterte admitted having used a hit squad that killed criminals in Davao when he was its mayor, but denied giving out rewards for these killings. — Kenneth Christiane L. Basilio
A PHILIPPINE senator on Monday called on the government to effectively carry out a national learning intervention program geared toward literacy and basic math skills to boost the performance of Filipino students in global assessments.
In a statement, Senator and Basic Education Committee Chairman Sherwin T. Gatchalian said the Academic Recovery and Accessible Learning Program (ARAL) bill, which was signed into law last month, would build basic literacy and number skills starting at the kindergarten level.
“In addressing the education crisis facing our country, it is crucial to ensure that our students can read and comprehend what they are reading,” he said in Filipino. “Through the implementation of the ARAL program and other reading initiatives we are promoting, we can help our youth build a strong foundation for their education.”
The ARAL Act, a priority measure of President Ferdinand R. Marcos, Jr., tasks the Department of Education (DepEd) to come up with a national learning intervention program to help struggling students catch up with academic standards for their grade levels.
“This law demonstrates our collective resolve to uplift the state of education in the Philippines,” Education Secretary Juan Edgardo “Sonny” M. Angara said at the signing ceremony at the presidential palace on Oct. 18.
“With ARAL, we can help students regain their momentum and achieve the learning milestones they deserve,” he added.
Under the law, tutorial sessions would be provided by the agency through face-to-face, online or blended learning methods.
Mr. Gatchalian also pushed more mandatory learning camps to help Filipino students keep up with basic subjects.
Only 52% of students in Grades 1 to 3 have “grade-ready” reading abilities, he said, citing data from DepEd last year.
Filipino students were among the weakest in the Programme for International Student Assessment (PISA) 2022 global assessment for student performance in mathematics, reading and science, ranking 77th out of 81 countries and performing worse than the global average in all categories.
The assessment showed that only 76% of the country’s 15-year-old students reached minimum proficiency reading.
The Philippines placed 22nd out of 111 countries in the 2022 English Proficiency Index by Education First. — John Victor D. Ordoñez
By Chloe Mari A. Hufana, Reporter
A DONALD J. TRUMP comeback in the White House would “not really hurt” Manila and Washington’s diplomatic ties, an international relations expert said as the United States gears for its presidential polls on Tuesday.
Josue Raphael J. Cortez, a diplomacy instructor at the De La Salle-College of St. Benilde’s School of Diplomacy and Governance, said that while Mr. Trump’s trade policies vary from incumbent American President Joseph Robinette Biden’s, America is still poised to leverage its growing importance in the Indo-Pacific region.
“Given the push that the United States Congress right now is undertaking to ensure that the US will play a more vital role in instilling order in the Indo-Pacific due to the present circumstances, then there’s a possibility that Trump will then be forced to adhere to current American initiatives towards the region,” he told BusinessWorld in a Facebook Messenger chat.
If Mr. Trump took a different stance; it could cause wariness among Indo-Pacific countries on what the US want in the region, he said.
“Given that he is also wary of the fact that the United States’ power is being challenged by China, then foreign policy-wise he will continue to undertake a more stringent approach towards China,” he said.
The Republican bet previously employed in his presidency the “America first policy,” which Mr. Cortez said may be reinstated in his push for “populist-gearing policies” in the US if he wins this week.
The convicted felon nominee is also known for his animosity towards migration-related matters.
“Filipinos seeking to move abroad may also have a hard time should his regime opt to enforce policies which would act as deterrent for migration,” Mr. Cortez said.
A HARRIS PRESIDENCY
Meanwhile, a Kamala Devi Harris administration would likely promote a rules-based order and potentially counterbalance China’s influence, he added.
Mr. Cortez said the Democrat’s track record as a vice president showed her commitment to maintaining a rules-based order across the region.
“[Such initiatives] may also be a deterrent for China’s aspirations across the region which it plans to realize by hook or by crook,” he said.
During her tenure as vice president, Ms. Harris visited the Philippines in November 2022, and other Southeast Asian countries.
These visits showed Washington’s “unfazed support” for regional peace and stability, as well as Association of Southeast Asian Nations (ASEAN) centrality, according to Mr. Cortez.
The Philippine-US relations during the Biden administration also saw the expansion of military bases that will host US forces to 9 locations from the initial 5, under the Enhanced Defense Cooperation Agreement.
The allied countries have also conducted a series of joint military exercises in the South China Sea to strengthen relations and build capacity.
In what it called a “historic first,” the US flew its mid-range missile system, Typhon, to the Philippines in April. The missile system remains in the country despite China’s demands to withdraw it from the Southeast Asian nation.
THE PHILIPPINES on Monday denounced North Korea firing a ballistic missile that flew over South Korea and Japan waters at the weekend, according to the Philippine Department of Foreign Affairs (DFA).
“We call on the Democratic People’s Republic of Korea (DPRK) to immediately cease these activities and abide by all international obligations, including relevant United Security Council Resolutions, and to commit to peaceful and constructive dialogue,” the agency said in a statement.
North Korea’s Central News Agency has called the country’s Hwasong-19 as the “world’s strongest strategic missile” and “the perfected weapons system.”
The agency said North Korea Supreme Leader Jong observed the launch and said it was a response to “external threats” to North Korea’s security.
In July, the DFA condemned an earlier ballistic missile launch by the DPRK, urging it to keep the peace in the Indo-Pacific region and to pursue dialogue in the Korean Peninsula.
In 2021, the Senate ratified UN Treaty on the Prohibition of Nuclear Weapons, making the Philippines the 53rd nation to adopt the treaty. The treaty, signed by 86 countries, took effect after it was ratified by at least 50 states.
The treaty bars nations from developing, testing, producing, manufacturing, transferring, possessing, stockpiling, using or threatening to use nuclear weapons.
“The Philippines wants to see lasting peace in the Korean Peninsula and echoes the calls of the international community for a complete, verifiable and irreversible denuclearization of the DPRK,” the DFA said. — John Victor D. Ordoñez
THE Center for Energy, Ecology, and Development (CEED) on Monday reported two coal spills in the provinces of Sorsogon and Zambales due to the onslaught of Sever Tropical Storm Trami (Kristine), urging the Philippine government to “hasten the country’s transition away from fossil fuels and to strengthen measures to protect marine and coastal environments from pollution.”
“After hundreds of thousands of liters of oil spilled in the Verde Island Passage last year and in Manila Bay earlier this year, we’re now seeing these disastrous coal barge accidents,” CEED Executive Director Gerry C. Arances said in a statement.
“All of them came about from severe weather events. They are a terrible yet stark reminder that fossil fuel projects are dirty, deadly and costly in more ways than one, triggering worse climate disasters and directly polluting the environments and communities that host them,” he added.
The coal barge in Sorsogon has killed fish and destroyed marine ecosystems and livelihoods, CEED said, noting that a coastal community in Bucalbucalan village had raised alarm over the darkening of the coast due to the soaking of the barge’s coal.
Meanwhile, the grounded barge case in Zambales carrying 11,000 metric tons of coal threatens the Masinloc-Oyon Bay Protected Seascape and Landscape, Central Luzon’s first marine protected area and regarded as one of the country’s most important locations for marine biodiversity, CEED said.
“As the climate crisis worsens, a repeat of these tragic incidents will always be possible for the climate-vulnerable Philippines. It’s high time for the government to rethink its expansion plans for coal and all other fossil fuels and prioritize a swift and just transition to renewable energy instead.” — Kyle Aristophere T. Atienza
A House of Representatives committee is looking at limiting agencies that could request secret funds, a congressman said on Monday.
Manila Rep. Joel R. Chua told reporters that the House good government and public accountability panel is considering restricting which government departments and agencies could request for Confidential and Intelligence Funds (CIF) amid controversies hounding Vice-President Sara Z. Duterte-Carpio.
“We see here a loophole in the law, which is why agencies that have nothing to do with intelligence gathering are being given confidential funds,” Mr. Chua, who heads the House good government and public accountability panel, said in Filipino.
“One of the things we are discussing here is to limit the agencies and departments of the government that will be given a confidential fund,” he added.
Ms. Carpio is being questioned by congressmen for her use of CIF, under the Office of the Vice-President (OVP) budget in 2022 and the Department of Education in 2023, when she sat as its secretary.
The OVP did not immediately respond to an email seeking comment.
State auditors told congressmen in August that they cannot account for the OVP’s P73-million CIF spending in 2022. Lawmakers are also looking at cash advances worth P112.5 million made by the Education department through three separate checks worth P37.5 million during the first three quarters of 2023.
“The monitoring [of confidential fund spending] has become somewhat lax, so that needs to be tightened, especially for departments that have nothing to do with [secret funds],” said Mr. Chua, noting that he finds the joint circular governing CIF use as “lacking.”
CIFs are meant to finance surveillance and intelligence information gathering activities, according to a 2015 joint circular between the Commission on Audit, Defense, Budget and Interior and Local Government departments.
The circular mandates CIF recipients to prepare a financial plan supporting their activities, but its audit reports are not made public. — Kenneth Christiane L. Basilio
A CONGRESSMAN on Monday urged the House of Representatives to tackle a measure that will cut the Philippine Health Insurance Corp.’s (PhilHealth) premiums to 4% from 5% under the Universal Healthcare Act.
Filed by Party-list Rep. Wilbert T. Lee in October, House Bill No. 10995 seeks to reduce the premium payments made by PhilHealth contributors to 4% this year, with incremental increases of 0.25% until 2026.
The measure also allows the president to suspend further premium contribution hikes in times of national and public health emergencies, and state of calamities.
“PhilHealth has a substantial amount of money, it should be allocated not only for expanding benefits for Filipinos, but also for reducing contributions, which is also a heavy burden for many of our countrymen,” he said in a statement.
In August, the Senate passed a bill reducing monthly premium contributions to 3.25% for those with a monthly income of P10,000 to P50,000.
The agency started hiking its monthly contribution rate in 2019 to sustain the benefits given to its members. — Kenneth Christiane L. Basilio
