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Stocks climb on positive data, Wall Street’s rise

BW FILE PHOTO

PHILIPPINE STOCKS rebounded on Tuesday as sentiment was boosted by data showing poverty incidence in the country declined last year and US markets’ positive performance overnight.

The Philippine Stock Exchange index rose by 0.61% or 41.07 points to end at 6,753.12 on Tuesday, while the broader all shares index gained by 1.06% or 38.50 points to close at 3,638.48.

“The local market rose as investors digested President Ferdinand R. Marcos, Jr.’s latest State of the Nation Address (SONA) this Monday. Also, the improvement in the country’s poverty incidence level was cheered by many,” Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said in a Viber message.

In his SONA, Mr. Marcos announced a total ban on all offshore gaming operations in the Philippines, saying these have been linked to illegal activities including money laundering and financial scams.

Meanwhile, about 17.54 million Filipinos were living in poverty in 2023, significantly lower than the nearly 20 million in 2021, the Philippine Statistics Authority (PSA) reported on Monday.

Based on preliminary results of the PSA’s Family Income and Expenditure Survey, the poverty incidence among the population fell to 15.5% from the 18.1% estimate in 2021.

The latest figure is lower than the government’s development target for poverty incidence in 2023 at 16-16.4% under the Philippine Development Plan 2023-2028.

“Philippine shares followed Wall Street’s positive sentiment, with technology stocks rebounding from last week’s sell-off,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan added in a Viber message.

Wall Street’s three benchmarks ended higher on Monday as investors returned to megacap growth stocks, helping both the S&P 500 and the Nasdaq Composite recover from their worst weekly performance since April, Reuters reported.

The S&P 500 gained 59.41 points or 1.08% at 5,564.41 points, while the Nasdaq Composite climbed 280.63 points or 1.58% to 18,007.57. The Dow Jones Industrial Average rose 127.91 points or 0.32% to 40,415.44.

Back home, majority of sectoral indices closed higher. Holding firms increased by 1.66% or 95.67 points to 5,842.49; services went up by 1.51% or 30.33 points to 2,026.51; industrials climbed by 0.64% or 58.79 points to 9,113.28; and mining and oil rose by 0.12% or 11.10 points to 8,728.94.

Meanwhile, property dropped by 1.62% or 44.24 points to 2,681.82, and financials went down by 0.17% or 3.61 points to 2,083.18.

Value turnover declined to P5.49 billion on Tuesday with 401.94 million shares changing hands from the P6.23 billion with 531.62 million issues traded on Monday.

Market breadth was negative as decliners outnumbered advancers, 93 to 67, while 74 names closed unchanged.

Net foreign buying went down to P442.93 million on Tuesday from P1.01 billion on Monday. — R.M.D. Ochave with Reuters

US, Philippines to hold 2+2 meeting next week to tackle maritime issues 

AN AERIAL VIEW of the BRP Sierra Madre at the contested Second Thomas Shoal on March 9, 2023. — REUTERS

TOP DEFENSE officials and diplomats from the United States and the Philippines will meet on July 30 to discuss tensions with China in the South China Sea, the Philippine Department of Foreign Affairs (DFA) and US State Department said in separate statements.

In a statement on Monday evening, the DFA said US Secretary of State Antony John Blinken and Defense Secretary Lloyd J. Austin III would meet with Philippine Foreign Affairs Secretary Enrique A. Manalo and Defense Secretary Gilberto Eduardo C. Teodoro, Jr. to come up with solutions to regional and global security issues.

Their visit to Manila is part of their trip to Asia, where they seek to reassure allies and partners of US support, Assistant Secretary of State Daniel Kritenbrink told reporters in Washington on Monday, as the November US presidential election casts uncertainty over US foreign policy.

“The four secretaries are expected to discuss how to further enhance our two countries’ ironclad commitment to this alliance while enabling a common program in support of the rules-based international order, enhanced economic ties, broad-based prosperity,” the DFA said.

In a separate statement, the US State department said Mr. Blinken and Mr. Austin would also meet with Philippine President Ferdinand R. Marcos, Jr. to explore “additional ways to capitalize on the unprecedented momentum in the US-Philippine alliance.”

The US stands by its “ironclad” commitments to defend the Philippines against an armed attack in the South China Sea, Mr. Blinken told his counterpart Mr. Manalo during his visit to Manila in March.

He said defense ties with the Philippines were “extraordinary” and would only grow further, adding that Washington’s expanding alliances were not aimed at China.

In his third address to Congress on Monday, Mr. Marcos said the Philippines would continue to find ways to deescalate tensions in contested areas in the waterway “without compromising our position and our principles.”

“The Philippines cannot yield,” he said. “The Philippines cannot waver… The West Philippine Sea is ours,” he added, referring to areas of the South China within the country’s exclusive economic zone.

In April, Mr. Marcos met with US President Joseph R. Biden and Japanese Prime Minister Fumio Kishida in the nations’ first trilateral summit in Washington.

The leaders committed to boost ties in maritime security amid China’s growing assertiveness in the waterway.

Manila and Tokyo earlier this month signed a pact that eases the entry of equipment and troops for combat training, saying they want stability in the region.

In a separate statement, US Assistant Secretary for East Asian and Pacific Affairs Daniel J. Kritenbrink said Washington welcomes recent agreements between the Philippines and China to ease sea tensions.

“Our position has been to strongly support our Filipino allies as they have worked to maintain and resupply the (BRP) Sierra Madre, as they’ve done since 1999,” he said, referring to the World War II-era ship that Manila grounded at Second Thomas Shoal to bolster its sea claim.

The Philippines and China reached a “provisional arrangement” during a bilateral meeting on July 2 for resupply missions to Filipino troop stationed at the shoal, the DFA said at the weekend.

Chinese Coast Guard forces with bladed weapons on June 17 boarded Philippine rubber boats and looted several rifles stored in gun cases, actions that Manila’s military chief Romeo S. Brawner, Jr. said only “pirates” do.

A Filipino Navy sailor on a rubber boat lost his right thumb after the boat was rammed by a Chinese Coast Guard rubber boat, according to the Philippine military.

The Chinese Foreign Ministry on Monday said it would only allow Philippine resupply missions to the shoal if the Philippines informs it in advance. The DFA said Manila had never agreed to prior notification during talks with Chinese officials.

Both countries have also agreed to set up new lines of communication to improve their handling of sea disputes.

‘ALL-IN’
Beijing insists it has sovereignty over most of the South China Sea based on its old maps and has deployed hundreds of coast guard vessels deep into Southeast Asia to assert its claims, disrupting offshore energy and fishing activities of its neighbors including Malaysia and Vietnam.

China has ignored a 2016 international arbitral ruling that voided its claims for being illegal.

“I think the key now from our vantage (point) would be to ensure it (resupply deal) is implemented, and No. 2, that China ceases its provocative and destabilizing activities around Second Thomas Shoal that we’ve seen in recent weeks,” Mr. Kritenbrink said.

US tensions with China will provide the backdrop to the trip. Mr. Blinken is expected to meet his Chinese counterpart Wang Yi on the sidelines of regional meetings in Laos, he said.

Mr. Blinken will also visit Singapore and Mongolia, and stop in Vietnam for the funeral of Nguyen Phu Trong, head of the ruling Communist Party, who died last week.

The trip follows a tumultuous month in Washington. President Biden announced on Sunday he would not run for reelection, and endorsed his vice president, Kamala Harris, to replace him. The Republican nominee, former President Donald Trump, earlier survived an assassination attempt.

Asked what Mr. Blinken would say to allies about Mr. Biden’s decision to step aside and whether that could bring changes in policy, Mr. Kritenbrink said the message would be that America is “all-in on the Indo-Pacific.”

“We do try to reassure allies and partners that there are certain fundamentals, I think, about America’s engagement that are not going to change that have been consistent,” he said, citing American investments and bipartisan support in Washington for the administration’s approach to the region. — John Victor D. Ordoñez with Reuters

Marcos may keep shunning Duterte policies as rift widens

PRESIDENTIAL COMMUNICATIONS OFFICE

By Kyle Aristophere T. Atienza, Reporter

PHILIPPINE President Ferdinand R. Marcos, Jr. is expected to distinguish himself from the policies of his predecessor as the midterm elections near, political analysts said, amid a growing rift between the two and their supporters.

Cleve V. Arguelles, president of WR Numero Research, noted that the President in his third address to Congress on Monday had tried to distance himself from the policies of ex-President Rodrigo R. Duterte including his deadly war on drugs.

He also ordered a total ban on Philippine Offshore Gaming Operators (POGO), which thrived during his predecessor’s term, while vowing to boost ties with allies amid growing tensions with China.

Mr. Duterte led a pivot to China away from the United States and western allies, pursuing closer trade and investment ties with its neighbor.

In his speech, Mr. Marcos said his government’s anti-drug campaign is “bloodless.” While “extermination” was not among its tenets, the campaign resulted in 71,500 operations with more than P44 billion worth of illegal drugs seized and more than 97,000 drug suspects arrested, he said.

More than 6,000 of those arrested were high-value targets, he said, adding that 440 of them were government employees, 42 of whom were uniformed personnel.

But Mr. Arguelles said there were 700 drug war-related killings during Mr. Marcos’ first two years in office.

“And there is no justice yet for the more than 30,000 killed in the Duterte drug war that falls under his responsibility now,” he added.

On the Philippines’ sea dispute with China in the South China Sea, Mr. Marcos said Manila “cannot yield.” “The Philippines cannot waver.”

“We are now more conscious as a people, and strategic in heightening our aerial and maritime domain awareness,” he said, adding that the government would continue to partner with like-minded states.

Mr. Marcos received a standing ovation for these remarks, along with his announcement to ban POGO, which are mostly Chinese online gambling firms in the Philippines that target Chinese clients.

“Clearly, these are repudiation of the former policies of Duterte and exposing the effects of what the previous government did to our country,” said Gary Ador Dionisio, dean of the De La Salle–College of Saint Benilde’s School of Diplomacy and Governance.

Mr. Duterte, widely known for his war on drugs that had killed thousands, is being investigated by the International Criminal Court.

The probe covers crimes committed in Davao City from November 2011 to June 2016 when he was still its mayor, as well as cases during his presidency up until March 16, 2019, the day before the Philippines withdrew from the ICC.

Mr. Marcos had said his government was studying the possibility of rejoining the ICC, though he insists its probe of the drug war violates Philippine sovereignty.

Anthony Lawrence A. Borja, a political science professor at the De La Salle University, said the President’s State of the Nation Address (SONA) was designed to serve as both “a wish list” of his priorities and a “rallying point” for prospective members of the administration slate in 2025.

“As an attempt to shore up support for the current administration, it was marked first by an outright, or even a preemptive, recognition of persistent problems, while highlighting continued efforts to resolve them,” he said in a Facebook Messenger chat.

The Philippine leader clearly signaled that maritime security is a key political issue, he added.

“In line with his approach to China and his clear redirection of the government’s campaign against illegal drugs, Marcos Jr. clearly established a distinction between himself and Duterte’s administration,” Mr. Borja said.

Vice-President Sara Duterte-Carpio, Mr. Marcos’ running-mate in the 2022 elections, did not attend the SONA. Her office said in a statement before the event she would not watch the SONA.

“VP Sara Duterte’s absence further amplifies the longstanding split between the Marcos and Duterte camps,” Mr. Borja said. “Overall, the recent SONA’s policy orientation is a stark contrast to Rodrigo Duterte’s inflammatory rants that have characterized his administration.”

On Tuesday, Ms. Duterte-Carpio said the national police chief had relieved the 75 police and security group personnel who were assigned to protect her.

“I want to assure the public that this order will not affect my work in the Office of the Vice President,” she said in a statement.

Mr. Arguelles said Mr. Marcos should have declared an end of the war on drugs. “Until then, the celebrations are premature.”

“His government must have a clear and actionable plan on how drug war victims can get justice and how state agents who abused their powers can be made accountable such as cooperating with the ICC investigation,” he added.

Gov’t work cut short in NCR due to heavy rains

PAGASA.DOST.GOV.PH

THE PRESIDENTIAL PALACE suspended work in government offices and classes at all levels in the National Capital Region (NCR) effective 2 p.m. on Tuesday amid heavy rains brought by the southwest monsoon and Typhoon Carina.

The Senate and House of Representatives also enforced shortened work hours for the day.

Carina continued to intensify as it moved northward, prompting the state weather bureau to raise Tropical Wind Signal No. 2 over Batanes province.

The center of the eye was spotted 325 kilometers east-northeast of Basco, Batanes, the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) said in a 5 p.m. bulletin.

It had maximum sustained winds of 150 kilometers per hour (kph) near the center and gustiness of up to 185 kph, it said.

Carina was forecast to move north-northwestward over the Philippine Sea on Tuesday night, while gradually accelerating before turning northwestward on July 24.

Carina would remain far from the Philippine landmass. It was forecast to make landfall over the northern portion of Taiwan between Wednesday and Thursday morning, then exit the Philippine area of responsibility hours later.

Carina was then expected to cross the Taiwan Strait and make landfall over southeastern China on Thursday afternoon or evening, PAGASA said.

“Carina is forecast to steadily intensify and may reach its peak intensity prior to its landfall over Taiwan,” it said. “Rapid intensification remains likely. Its landfall over northern Taiwan will trigger a weakening trend for the rest of the forecast period.”

Cagayan including Babuyan Islands, the eastern portion of Isabela, the northern portion of Apayao and the northern part of Ilocos Norte were placed under Signal no.1.

Agricultural damage from the combined effects of Carina and southwest monsoon was estimated at P79.52 million, the Department of Agriculture said in a bulletin.

Total volume loss had reached 392 metric tons, affecting 3,254 farmers.

PAGASA also issued a gale warning over the coastal areas of Batanes, Babuyan Islands, and the northeastern portion of Cagayan.

“Sea travel is risky for small seacraft, including all types of motor bancas,” it said. Moderate to rough seas were expected along the coastal waters of northern Luzon. — AHH

Marcos silence on wage hike scored

PHILIPPINE STAR /KJ ROSALES

LABOR groups have criticized President Ferdinand R. Marcos, Jr. for failing to mention their plea for a legislated wage increase in his third state of the nation address (SONA) before Congress on Monday.

“It seems the Marcos economic team has shot down [the proposal],” Federation of Free Workers (FFW) President Jose Sonny G. Matula told BusinessWorld in a Viber message on Tuesday. “We need to explore other strategies, especially since the House of Representatives is taking cues from the Marcos economic team.”

He said they would continue to lobby before Speaker Ferdinand Martin G. Romualdez and Labor Secretary Bienvenido E. Laguesma for the legislated wage hike.

“President Marcos expressed optimism about the nation’s growth trajectory, but without wage recovery, this growth is directionless,” Mr. Matula said. — Chloe Mari A. Hufana

Workers to get medical allowance

PHILIPPINE STAR/BOY SANTOS

A TOTAL of P9.5 billion would be allocated for state workers’ medical allowances next year, the Department of Budget and Management (DBM) said on Tuesday.

In a statement, the agency said the amount was earmarked under the miscellaneous personnel benefits under the P6.352-trillion national budget for 2025.

“Healthcare is a top priority of this administration,” Budget Secretary Amenah F. Pangandaman said in mixed English and Filipino. “By giving medical allowances to the public, we can help them ease their medical expenses.” — Beatriz Marie D. Cruz

Gov’t told to boost digital infra

REUTERS

THE PHILIPPINE government should seek more partnerships with the private sector to boost the country’s digital infrastructure especially in far-flung areas, according to the Philippine Chamber of Commerce and Industry (PCCI).

“To ensure a smooth digitalization process, authorities should prioritize investment in infrastructure development, enhance digital skills of the workforce and strengthen the regulatory framework,” PCCI President Enunina V. Mangio told BusinessWorld in a Viber message in reaction to President Ferdinand R. Marcos, Jr.’s State of the Nation Address on Tuesday.

“Most rural areas still lack reliable and high-speed internet connections, hindering digital inclusion,” she said. “Reforms are needed to allow the private sector put this information-communication infrastructure in place.” — John Victor D. Ordoñez

Chiz seeks halt to jeepney phaseout

PHILIPPINE STAR/MIGUEL DE GUZMAN

SENATE President Francis “Chiz” G. Escudero on Tuesday said he supports a proposal to suspend the government’s jeepney modernization program, citing the need for a review to avoid jeopardizing the livelihood of jeepney drivers and operators.

“Can our operators pay for these expensive modern jeeps?” he told a hearing in mixed English and Filipino. He said the plan was not well-thought of and the transport sector was not consulted.

“Majority of the Senate supports the suspension of this modernization program so that… we can quickly pass a resolution expressing the sense of the Senate and calling on the President to suspend this.”

Land Transportation Franchising and Regulatory Board (LTFRB) Chairman Teofilo E. Guadiz III told senators the cheapest modern jeepney costs about P2.6 million, which the Senate president said is too expensive.

The deadline for jeepneys to consolidate into cooperatives lapsed on Dec. 31, but public utility vehicles had been allowed to keep operating until Jan 31 this year. The President later extended the deadline to April 30.

The modernization program started in 2017, aiming to replace traditional jeepneys with units that have at least a Euro-4-compliant engine to cut pollution.

Transport groups have asked the Supreme Court to halt the modernization program for being illegal. — John Victor D. Ordoñez

House to fast-track POGO ban bill

REUTERS

THE HOUSE of Representatives will fast-track debates on a bill that seeks to ban Philippine Offshore Gaming Operators (POGO) to put teeth in the order of President Ferdinand R. Marcos, Jr. to shutter them all by yearend, Speaker and Leyte Rep. Ferdinand Martin G. Romualdez said on Tuesday.

In a statement, he said he had ordered House leaders to consolidate all bills seeking to ban POGOs so the chamber could immediately pass it.

“I am requesting all the committee chairs concerned to give this a priority,” he said. “The House committee on public order and security [should] submit their comprehensive report and recommendations to the committee on games and amusement as soon as possible.”

The House committee on games and amusement should come up with a committee report so plenary debates could start, he added. — Kenneth Christiane L. Basilio

Bill seeks end to mother tongue use

PHILSTAR FILE PHOTO

THE SENATE on Tuesday approved on final reading a bill that seeks to discontinue the use of the mother tongue as the medium of instruction from kindergarten to Grade 3.

Senate Bill No. 2457 seeks to revert the medium of instruction to Filipino and English pursuant to the 1987 Constitution. Regional languages will only serve as a supplementary medium of instruction.

“Mother tongue as the medium of instruction is not a one-size-fits-all solution for every classroom,” Senator Sherwin T. Gatchalian, who authored the bill, said in a statement. “It is effective only in monolingual environments where learners are uniformly native speakers of the same mother tongue.”

He said key experiments cited by the Department of Education (DepEd) as bases for implementing the mother tongue education proved that the policy is only effective in school settings where everybody is using the same language, especially in rural areas.

Twenty-two senators unanimously approved the measure.

DepEd only implements mother tongue-based teaching programs for 19 of 245 languages in the Philippines, according to the bill’s explanatory note, citing 2020 government data. — John Victor D. Ordoñez

Gov’t told to ease tourism curbs

The Philippines welcomed 3.17 million inbound tourists as of July 10. — PHILSTAR FILE PHOTO

THE PHILIPPINES should ease restrictions in the entry of foreign tourists if it wants to hit its goal of 7.7 million international arrivals this year, the Department of Tourism said on Tuesday.

It would be difficult to hit the target otherwise, Tourism Secretary Maria Esperanza Christina G. Frasco told reporters on the sidelines of an event discussing President Ferdinand R. Marcos, Jr.’s third State of the Nation Address.

“We are working as hard as we can to be able to reach that target, but to be realistic, unless and until we can fully open up the Philippines in terms of seamless entry, then it is a huge challenge to meet that number,” she added. — Justine Irish D. Tabile

Public say in rate hearings pushed

PHILIPPINE STAR/ MICHAEL VARCAS

CONGRESS should look at empowering electricity consumers by mandating the publication of information related to the rate-setting process and giving them a say in the franchise renewal of power companies, energy advocates said last week.

“In ensuring just and sustainable access to affordable energy in the Philippines, [Congress should] strengthen consumer protection by ensuring that critical information on the energy sector is reflected in public records,” Francine DG. Pradez, youth convenor of energy advocacy group Ilaw, said in a Facebook Messenger chat.

Consumer assessment of distribution utilities as a basis for franchise renewal should also be institutionalized, she added.

Congress is seeking to amend the 2001 Electricity Power Industry Reform Act (EPIRA), citing its alleged failure to lower electricity prices.

Lawmakers should review the structure of the power market as part of efforts to make electricity cheaper, Ms. Pradez said. “Reevaluate the market structures introduced by EPIRA and explore mechanisms to enhance market efficiency and address price volatility.” — Kenneth Christiane L. Basilio

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