How PSEi member stocks performed — June 9, 2023
Here’s a quick glance at how PSEi stocks fared on Friday, June 9, 2023.
How minimum wages compared across regions in May
Inflation-adjusted wages in May were 13.9% to 21% lower than the daily minimum wages across Philippine regions. In peso terms, real wages were P54.80 to P88.73 lower.
Stocks end week lower as market looks for leads
LOCAL EQUITIES declined on Friday as investors stayed on the sidelines as they awaited fresh leads.
The benchmark Philippine Stock Exchange index (PSEi) fell by 32.21 points or 0.49% to close at 6,507.15 on Friday, while the broader all shares index went down by 8.53 points or 0.24% to end at 3,476.18.
Week on week, the PSEi went down by 4.86 points or 0.07% from its 6,512.01 close on June 2.
“The local market struggled to track higher for the week given persistent selling pressure, which has also likely tempered buying appetite,” China Bank Securities Corp. Research Associate Lance U. Soledad said in a Viber message.
“[The market] continued to shrug off positive local news flows, posting its third straight weekly decline despite the removal of key market overhangs (e.g., MSCI rebalancing, US debt default), continued slowdown in inflation in May, with the BSP (Bangko Sentral ng Pilipinas) chief guiding that policy rates may hold steady as a result of the sustained easing, and a still-robust labor market, with an unemployment rate of 4.5% in April,” Mr. Soledad added.
Headline inflation eased to 6.1% in May from 6.6% in April, the slowest in a year or since the 5.4% in May 2022.
For the first five months, the consumer price index averaged 7.5%, still higher than the BSP’s 2-4% target and 5.5% forecast for the year.
The BSP last month kept borrowing costs steady, with the key rate now at 6.25%.
The Monetary Board’s next policy meeting will be on June 22. The BSP is expected to keep rates steady for its next two to three meetings as inflation continues to ease.
Meanwhile, the unemployment rate fell to 4.5% in April from 4.7% the previous month, equivalent 2.26 million jobless Filipinos, down from 2.42 million in March.
Year to date, the statistics authority reported the unemployment rate average at 4.7%, down from the 5.4% average in 2022, and 7.8% in 2021.
Meanwhile, the employment rate in April rose to 95.5% from 95.3% in March and 94.3% in the same month a year ago.
This translated to 48.06 million Filipinos who had jobs in April, a decrease of 523,000 from the 48.58 million in March.
Sectoral indices were split on Friday. Financials rose by 18.06 points or 0.98% to 1,846.41; mining and oil climbed by 42.67 points or 0.42% to 10,111.01; and services went up by 3.51 points or 0.22% to 1,541.76.
Meanwhile, property sank by 58.10 points or 2.16% to 2,626.98; holding firms dropped by 45.02 points or 0.69% to 6,475.24; and industrials went down by 20.01 points or 0.21% or 9,266.83.
Value turnover rose to P5.66 billion on Friday with 1.22 billion shares changing hands from the P3.86 billion with 626.14 million issues traded on Thursday.
Advancers outnumbered decliners, 92 to 80, while 52 names ended unchanged.
Net foreign selling dropped to P202.11 million on Friday from P416.92 million on Thursday.
The market is closed on June 12 for Independence Day. — A.H. Halili
Peso seen to trade sideways vs dollar before Fed, BSP reviews
THE PESO could trade sideways against the dollar this week on expectations that the US Federal Reserve will pause its tightening cycle at its policy meeting this week.
The local currency closed at P56.05 versus the dollar on Friday, strengthening by six centavos from Thursday’s P56.11 finish, data from the Bankers Association of the Philippines’ website showed.
Week on week, however, the peso declined by 16 centavos from its P55.89 finish on June 2.
The local unit opened Friday’s session at P55.999 per dollar. Its weakest showing was at P56.06, while its intraday best was at P55.90 against the greenback.
Dollars traded rose to $979.2 million on Friday from the $957 million recorded on Thursday.
The peso strengthened on Friday amid higher-than-expected US jobless claims, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
The dollar bounced off two-week lows on Friday as investors awaited inflation data and the Federal Reserve’s interest rate decision next week for any new clues on how high the US central bank is likely to hike rates, Reuters reported.
The Fed is expected to hold rates steady at its June 13-14 meeting, but is likely to remain hawkish and indicate a probable hike in July as inflation stays above its 2% target.
The dollar index, which measures the currency against six major peers, rose by 0.22% to 103.53.
The greenback is largely rangebound as investors wait for clearer signs of whether the economy will remain strong and inflation elevated, or if it is headed towards a contraction.
Data on Thursday showed the number of Americans filing new claims for unemployment benefits surged to the highest in more than 1-1/2 years last week.
Mr. Ricafort added that lower global crude oil prices also supported the peso.
On Friday, oil fell by more than $3 on reports that the US would give Iran sanctions relief to export oil in return for Tehran reducing uranium enrichment.
Brent crude settled down by 99 cents or 1.3% at $75.96 a barrel, while US West Texas Intermediate crude settled down by $1.24 or 1.7% at $71.29.
For this week, the peso could continue to trade sideways against the dollar as the Fed is expected to keep borrowing costs steady at its June 13-14 meeting, a move which could be matched locally, Mr. Ricafort said.
The US central bank raised borrowing costs by 25 basis points (bps) last month, bringing the fed funds rate to 5% to 5.25%.
It has hiked borrowing costs by 500 bps since March 2022.
Meanwhile, the Bangko Sentral ng Pilipinas (BSP) paused its aggressive monetary tightening last month and signaled it would put the key rate on hold for its next two to three meetings.
The BSP raised policy rates by 425 bps from May 2022 to March 2023.
The Monetary Board will next meet to review policy on June 22.
For this week, Mr. Ricafort sees the peso trading between P55.75 and P56.25 a dollar.
Philippine financial markets will be closed on Monday for the Independence Day holiday. — A.M.C. Sy with Reuters
Filipino children from 5.6M households heavily vulnerable to climate shocks
CHILDREN from 5.6 million low-income households in the Philippines face deadly threats from the climate crisis, which worsen the state of education in the country, according to a development organization.
“During climate emergencies, many affected families find it hard to send their children to school or even access healthcare,” Save the Children Philippines said in a statement on Sunday.
“Children suffer the most because they look for work to help augment their daily needs,” it said.
As climate shocks significantly affect the livelihood of low-income families, Filipino girls are at greater risk of being “abused, neglected, exploited, or subjected to child marriage,” the organization said.
“No child deserves to grow up in poverty and an unsafe environment. But the reality is grim,” Save the Children Philippines said. “Millions of Filipino children remain poor due to inequality and discrimination, and their situation is exacerbated by the climate.”
According to the 2023 Global Slavery Index of international human rights group Walk Free, climate change worsens modern slavery as it intensifies structural gender inequalities, which mostly affect women, and creates an economic condition that forces parents to give away their children for marriage in order for them to secure some financial stability.
Citing the United Nations, the report said that 80% of those displaced by the climate crisis are female.
“When climate change affects local economies, a larger section of the population loses domestic jobs and engenders internal migration to better-off economic centers,” Hansley A. Juliano, a political economy researcher, told BusinessWorld.
“This promotes congestion in metropolis that also reduces quality of life due to population density,” he added. “This density also feeds exploitative industries who are willing to hold these vulnerable people in low paying jobs, which includes illegal labor and flat-out trafficking.”
The Philippines, considered as an agricultural country, is highly vulnerable to climate change. Last year, Greenpeace told BusinessWorld that as much as 80% of Metro Manila could be submerged by 2030, potentially impacting 87% of its gross domestic product.
Filipino farmers are among the sectors that are heavily affected by the climate crisis, which increases the frequency of extreme El Niño events.
El Niño is expected to derail the growth of the Philippine agriculture sector which, in the first quarter, expanded by 2.1%, a turnaround from the 0.3% decline in the same quarter a year ago.
In 2019, the agriculture sector was severely hit by the weather pattern, with the damage to the sector hitting as much as P8 billion.
Save the Children Philippines urged the Philippine government to craft child-centered climate change mitigation and adaptation plans, noting that many Filipino children lack access to basic services on health, education, proper nutrition, or adequate housing.
“Without urgent and concrete actions to mitigate the negative impact of climate change and support for the most vulnerable families, we are at a setback in fulfilling children’s right to survive, learn, be protected, and thrive,” it said.
President Ferdinand R. Marcos, Jr., who vowed to work towards a shift to green energy, has yet to declare a climate emergency, which would authorize the government to mobilize funds to step up climate mitigation efforts.
The House of Representative made a declaration in 2019, but Greenpeace said last year that a “follow-through” from the National Government has yet to be seen. — Kyle Aristophere T. Atienza
Study supports bill that will legalize motorcycle taxi service
THE PHILIPPINE Congress has been urged to fast-track the passage of a bill that will legalize the operation of motorcycle taxis, citing its role in plugging gaps in public transportation and employment while addressing the need for regulation to ensure safety.
In a research paper released recently, transportation expert Rene S. Santiago and Libra Konsult, Inc. Senior Advisor Nigel Paul Villarete said there is adequate manpower available for motorcycle taxi drivers and significant demand for the service.
“Scarcity of employment opportunities enlarges the supply of MC-Tx (motorcycle taxi) drivers, [and] the inadequacy — if not total absence — of alternative modes of public transport in many areas which, in turn, fuels demand,” they said in their study titled “Out from the Cold: Unboxing Habal-Habal in the Philippines (and the Motorcycle-taxis in the Global South)”.
Habal-habal is the colloquial term for unregulated motorcycles that have long been providing service for a fee, especially in rural and remote parts of the country where there are no other forms of public transport.
Mr. Santiago, former president of the Transportation Science Society of the Philippines, called to focus on “technical regulation” of MC taxis to address concerns on road and passenger safety.
“The correct one is technical regulation via the 3 Es (engineering, enforcement, education) — particularly annual vehicle inspections — should be strengthened — for all motor vehicles, not just motorcycles or habal-habal. Our roads are unsafe, to begin [with],” he said in a Viber chat.
“It would be better if the bill will also be prioritized and passed as it will provide the public more opportunities for livelihood and [be] a good option for commuters,” Ronald Gustilo, national campaigner of Digital Pinoys, said via Viber.
Mr. Gustilo, however, said the proposed measure should add stiffer penalties that would discourage overpricing.
“The MC taxi for hire act should also include a mandatory period for settling cases like overpricing and safety violations,” he said.
He added that traffic regulations and improvement of roads should be implemented along with the legalization of motorcycle taxis.
Mr. Santiago noted that existing ride hailing companies and accredited motorcycles-for-hire already function under relatively adequate regulatory provisions.
These services are operating through a provisional authority as Republic Act (RA) No. 4136, or the Land Transportation and Traffic Code prohibits the use of two-wheeled vehicles for public transport.
The proposed Motorcycles-For-Hire Act, which will amend RA 4136, is still pending at the committee levels in both the Senate and the House of Representatives.
Senator Mary Grace S. Poe-Llamanzares, chair of the public services committee, said in a Viber chat, “The committee is currently waiting for submissions from the inter-agency MC taxi committee and other major stakeholders before it releases the committee report.” — Beatriz Marie D. Cruz
Coronavirus cases seen falling back to ‘low levels’
By Kyle Aristophere T. Atienza, Reporter
DAILY coronavirus cases in the Philippines would likely fall to fewer than 1,000 starting next week, according to pandemic monitoring group OCTA.
“We should be seeing fewer than 1,000 new cases daily. The situation for COVID-19 will be back to low levels,” OCTA fellow Fredegusto P. David said in a Facebook Messenger chat.
He said any possible COVID-19 infection wave in the future would likely become manageable and would not overwhelm hospitals.
“COVID-19 will be back with another wave but we don’t expect it to be different from the other waves we saw this year and last year,” he said.
On Saturday night, Mr. David said the Philippines posted 878 new cases with 1,328 new recoveries. No COVID-19-related deaths were reported during the day, when active cases in the country hit more than 11,600.
Metro Manila accounted for 206 of the new cases recorded on June 10, followed by Cavite with 57, Iloilo and Pampanga with 48 each, and Bulacan with 52 cases.
Cagayan province in the country’s north was also on the list with 37 new cases, Laguna with 34, Rizal with 26, Bataan with 23, and Negros Occidental in central Philippines with 22.
On June 5, health authorities reported that the country had recorded 9,107 COVID-19 infections from May 22 to June 4 with a daily average of 1,301 — 22% lower than the average cases per day from a week earlier.
There were 77 severe and critical cases during the May 22-June 4 period, when three new COVID-19 related deaths were recorded.
Last month, when daily COVID-19 infections in the country had hit almost 2,000, the Private Hospitals Association of the Philippines, Inc. (PHAPI) said patients admitted in private hospitals who tested positive for COVID-19 had increased.
It said most of the admissions were “coincidental COVID,” a label used for patients who were admitted for different health issues but tested positive for COVID-19 when screened.
President Ferdinand R. Marcos, Jr., in May, said the “worst is over” for COVID-19, noting that the Philippines can now focus on boosting the economy.
He made the statement after the World Health Organization (WHO) had declared that COVID-19 is no longer a global public health emergency.
Mr. Marcos, 65, has been citing supposed growing immunity from COVID-19 among Filipinos.
Based on the Department of Health’s (DoH) May 29 to June 4 bulletin, a total of 78.44 million had been fully vaccinated against COVID-19. Of these, only 23.81 million had received booster shots.
The Philippines’ new Health secretary, Teodoro Herbosa, has yet to discuss how the Philippines plans to deal with the pandemic.
Maria Rosario S. Vergeire, who temporarily headed the Health agency prior to Mr. Herbosa’s appointment, said in May that the inter-agency task force handling the country’s pandemic response had submitted its recommendations to Mr. Marcos Jr. in light of the WHO’s declaration.
As Health secretary, Mr. Herbosa will deal with a weak healthcare system, which has struggled with a critical shortage of healthcare workers.
NURSES
Last week, the new DoH chief said he will consider allowing nursing graduates without a license to work in government hospitals.
Under the proposal, nursing graduates will be given enough time — probably five years — to take and pass the licensure examination while employed, Mr. Herbosa said.
About 40% to 50% of nurses in private hospitals have quit their job in the last two years due to salary issues, the PHAPI earlier said.
As of December last year, the monthly salary for nurses in private hospitals averaged P12,000, while those working in the public sector were receiving an average pay of P35,097, according to the Filipino Nurses United.
In a statement at the weekend, Quezon City Rep. Marvin Rillo, vice chairperson of the House committee on higher and technical education, urged high school graduates to pursue a nursing program in college, citing a “very promising” job outlook.
“High school graduates should include nursing in their list of college options if they want a stable and lucrative occupation in the years ahead,” he said.
“Nurses are in great demand while the supply is short, so we would urge both male and female high school graduates to consider taking the nursing career path,” he added.
“We believe that nursing is a noble profession. We welcome his call for the youth to take up nursing but we do hope that it is for the purpose of serving our own people, and development of our nation,” the Filipino Nurses United told BusinessWorld.
The group said Filipino legislators should see to it that their proposals would always advance the nurses’ demands for higher pay and better working conditions “while ensuring that public health will be prioritized so that young nurses will not be disillusioned and frustrated with our own health care system pushing them more to seek better jobs abroad.”
The WHO, in a 2020 report, said that without action, there will be a shortfall of 4.6 million nurses worldwide by 2030.
In the Philippines, “the shortfall of nurses is expected to be 249,843 by 2030, unless greater investment is made now to retain them in the local health sector,” Mr. Rillo said, citing a report.
Mr. Rillo has been seeking a 75% increase in the minimum starting pay of nurses employed in government hospitals.
His bill seeks to increase the entry-level monthly pay of nursing staff in public hospitals to P63,997 from P36,619.
The Commission on Higher Education in July last year removed the decade-old moratorium on the opening of new BSN programs.
“The lifting of the freeze means that universities and colleges that currently do not offer the BSN program may now apply, and comply with the requirements, to offer the four-year degree course,” Mr. Rillo said.
CoA flags ERC for P18.8-M unremitted taxes
STATE AUDITORS flagged the Energy Regulatory Commission (ERC) for failing to remit taxes withheld from employees, contractors and suppliers in the past two years worth P18.79 million.
In its 2022 audit report made available on June 8, 2023, the Commission on Audit (CoA) said the ERC failed to fully comply with Bureau of Internal Revenue (BIR) rules by failing to transmit P11.67 million in 2022 and P7.12 million in 2021.
“Taxes withheld from the salaries and wages of the employees and payment to contractors/suppliers of goods and services during the year totaling P64.24 million and the prior year’s balance of P15.53 million were not remitted in full,” CoA said.
The ERC released P52.57 million of the withheld taxes in 2022 and P8.68 million for 2021.
CoA urged the management to immediately transfer the outstanding balance to the National Treasury.
“The ERC recognized the recommendation of CoA to ensure compliance with BIR rulings on tax remittances,” CoA noted.
The agency’s “FAS-AD (Financial and Administrative Service-Accounting Division) shall comply with all the adjustments needed to prepare particularly on the previous taxes withheld,” it said.
ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta said via Viber on Sunday, “I believe we already submitted our explanation to CoA on these observations.”
CoA also noted that the Development of the Transmission Regulatory Asset Base (RAB) Handbook and the Transmission Planning Manual for the National Grid Corp. of the Philippines (NGCP) was not completed within its contract period and has been delayed for more than a year.
“The ERC has decided to proceed with the project, and the submitted outputs and deliverables will be used to bring the project to completion,” CoA said.
The ERC’s unsettled audit disallowances for 2022 amounted to P32.51 million, state auditors said. — Beatriz Marie D. Cruz
Typhoon-enhanced monsoon to brings rains in western parts of Luzon, Visayas islands
THE SOUTHWEST monsoon enhanced by typhoon Guchol, locally known as Chedeng, will bring “occasional to monsoon” rains over the western portions of Luzon and Visayas in the next few days, according to state weather bureau PAGASA.
“While the effect of Chedeng on the monsoon will decrease as it moves further away from the Philippine Area of Responsibility (PAR), the formation of a frontal system north of Extreme Northern Luzon will continue to mainly enhance the Southwest Monsoon from Tuesday onwards and affect most of Luzon, especially the western and extreme northern portions,” the agency said in a Sunday bulletin.
The center of Chedeng was last spotted at 1,100 kilometers (km) east-northeast of extreme northern Luzon.
PAGASA said no wind signals due to Chedeng will be hoisted “for the remainder of the forecast period.”
However, the agency said the enhancement of the southwest monsoon may bring gusty conditions on Monday over Batanes, Babuyan Islands, Ilocos Region, Cordillera Administrative Region, Nueva Vizcaya, Central Luzon, Metro Manila, Calabarzon, Occidental Mindoro, Oriental Mindoro, Romblon, Marinduque, northern mainland Palawan, Calamian Islands, Cuyo Islands, Kalayaan Islands, Bicol Region, and Western Visayas.
“Gusty conditions will still continue over most of Luzon from Tuesday onwards as the Southwest Monsoon will be enhanced by another weather system,” PAGASA said.
The typhoon had maximum sustained winds of 120 kilometers per hour (kph) near the center and gustiness of up to 150 kph, PAGASA said.
Chedeng was expected to leave the PAR on Sunday night, PAGASA said in a briefing later in the day.
“It is forecast to accelerate northeastward,” said the bureau, which expected Chedeng to weaken into a severe tropical storm within the day. — Kyle Aristophere T. Atienza
Cotabato sees rise in business activities from villages under Bangsamoro’s special area
TOWNS in Cotabato are seeing an increase in trade activities and business permit applications from barangays that are under the Bangsamoro as infrastructure and social support are rolled out by the provincial and autonomous region’s governments.
Cotabato Governor Emmylou Taliño-Mendoza said new barangay halls and roads constructed using funds of the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) have given villagers access to government services and local markets.
“The connectivity, in terms of commerce and trade, among residents of other barangays that are under Cotabato province and those in the SGA (Special Geographic Area) is taking off nicely,” Ms. Mendoza told reporters Saturday.
The SGA consists of 63 predominantly Moro barangays in the western side of Cotabato that voted in 2019 to become part of the neighboring BARMM.
These villages are spread across six Cotabato towns: Aleosan, Carmen, Kabacan, Midsayap, Pigcawayan, and Pikit.
“Our municipal government and the office of our provincial governor are together helping them still even if their barangays are no longer under Cotabato province,” Midsayap Mayor Rolly C. Sacdala said.
BARMM’s Ministry of the Interior and Local Government has so far constructed 13 barangays halls in the SGA and 49 more have been lined up.
Mansur Samsudin Kalim, a Maguindanaon rice trader in Kabacan, said he is planning to expand his business in other SGA barangays in Carmen once the barangay hall projects in the town are completed.
“I have relatives residing in those areas who can help me oversee the rice and corn grains trading business I am planning to put up there,” Mr. Kalim said.
The Philippine Army’s 602nd Infantry Brigade commander, Donald M. Gumiran, said the barangay halls stand as an important venue and symbol of government presence in the communities.
“Barangay officials are now using these barangay halls as venues for settling family feuds and in planning solutions to community concerns,” Mr. Gumiran said.
A bill has been filed in the Bangsamoro transition parliament for the creation of eight new towns that will cover the SGA.
The BARMM Interior ministry had completed more than 50 other barangay halls, police stations and municipal halls in other areas in the six provinces and three cities in the autonomous region. — John M. Unson
New Davao tourism group head wants stronger ties with academe
THE DAVAO Tourism Association (DATA) will forge stronger links with educational institutions to enhance the skills, knowledge and capacity of workers, seen as a key element for the industry’s growth, according to the group’s new head.
“Coming from a strong academe background and my experiences in the industry, I see it very important to collaborate with educational institutions and industry experts to provide members with relevant information, market insights, and industry trends,” DATA President Nicole Bian-Ledesma said during last week’s installation of the group’s new set of officers and board members.
Ms. Bian-Ledesma is the chief operating officer of the JIB International Schools, which specializes in tourism, culinary, and entrepreneurship courses, among others.
The group will also build up on the principles of sustainability and responsible tourism, and espouse technological innovations.
“There is no escaping anymore. More than a trend or a byword, it is now a requirement that tourism players worldwide need to be more conscious and responsible, so we ensure a better future for the generations to come,” she said.
“Moreover, we need to adapt to new technologies and practices that can make our industry more responsive and resilient.”
Davao City, the regional center and jump-off point for various tourist destinations in the Davao provinces, has set a target of 1.8 million arrivals this year, 2.5 million in 2024, and 2.7 million in 2025.
Ms. Bian-Ledesma said the meetings, incentive travel, conventions, and exhibitions (MICE) segment will be one of the main drivers of the local tourism industry.
“With the resounding success of MICECON (conference) last March and many MICE-related activities in the pipeline, I am confident that Davao can surpass its targets,” she said. — Maya M. Padillo
EcoWaste Coalition warns vs toxic spray paints sold online
THE ECOWASTE Coalition has reiterated its warning to consumers to avoid purchasing toxic spray paints after it found two additional brands that have high lead content being sold online.
The group said in a statement over the weekend that it tested and found two imported spray paints with high levels of lead manufactured by China-based Unioue (Lufeng) Tech. Co. Ltd.
“The yellow variant passed the 90 parts per million (ppm) maximum limit for lead in paints, but the dark green and the medium green variants were found to contain high concentrations of lead measured at 56,300 ppm and 41,480 ppm, respectively,” the EcoWaste Coalition said.
Citing the World Health Organization, the group said that lead exposure causes anemia, hypertension, renal impairment, immunotoxicity and toxicity to the reproductive organs.
The group added that lead exposure could cause damage to the brain and the nervous system, reduced intelligence quotient, slowed growth and development, learning, hearing and speech difficulties, and behavioral problems.
“These spray paints are in violation of Department of Environment and Natural Resources Administrative Order 2013-24, which bans the use of lead in the production of paints and sets a stringent limit on lead content in paints to not over 90 parts per million (ppm), the strictest legal limit in the world,” Former EcoWaste Coalition President Manny Calonzo said.
“The availability of non-compliant paint products such as spray paints sourced from abroad justifies sustained market monitoring to keep compliance with the regulation in check and to protect the public from a preventable source of lead exposure,” he added. — Revin Mikhael D. Ochave