How PSEi member stocks performed — August 12, 2020
Here’s a quick glance at how PSEi stocks fared on Wednesday, August 12, 2020.
PSE index sustains climb on improved sentiment
PHILIPPINE SHARES continued growing on Wednesday on hopes that the lockdown will ease next week and news of a coronavirus vaccine from Russia.
The bellwether Philippine Stock Exchange index (PSEi) gained 41.06 points or 0.69% to close at 5,995 on Wednesday, marking its third straight day of growth.
The broader all shares index also increased 14.69 points or 0.42% to end at 3,551.98.
“(Wednesday’s) gains have wiped out all of the losses that we saw at the end of July when investors dumped shares because of the imposition of stricter quarantine,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail.
“Investors are slowly gaining confidence after reassurance that the lockdown will be eased… Vaccine hopes have also lifted the sentiment,” he added.
On Tuesday, the Russian government announced it has led the world in approving a coronavirus vaccine, which President Rodrigo R. Duterte said he will obtain for Filipinos.
The Philippine president also said he committed to clinical trials and local production of the Russian vaccine.
The development boosted investor sentiment on the Philippines’ capacity for recovery, as local coronavirus infections surged to 139,538 on Tuesday.
“Philippines shares closed short of the 6,000 mark, as investors weighed the outlook for the economy…,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile message.
Half of the sectoral indices at the PSE ended Wednesday’s session with gains. Financials rose 16.97 points or 1.53% to 1,127.10; industrials added 96.57 points or 1.23% to 7,916.09; and holding firms climbed 51.32 points or 0.84% to 6,166.17.
On the other hand, mining and oil lost 153.99 points or 2.63% to 5,703.97; property shed 7.15 points or 0.25% to 2,885.13; and services slid 1.56 points or 0.11% to 1,457.52.
Some 5.9 billion issues valued at P17.08 billion switched hands on Wednesday, up from the previous session’s 5.31 billion issues worth P5.07 billion.
Decliners outnumbered advancers, 102 against 85, while 47 names ended unchanged.
Net foreign selling stood at P360.1 million, slightly lower from the previous day’s P377.14 million.
US stocks closed lower on Tuesday, with the S&P 500 and Dow snapping a seven-day streak of gains and falling late in the session on growing uncertainty about breaking a stalemate in Washington over a fiscal stimulus deal.
Both indexes had been higher for much of the session, and the S&P 500 came within striking distance of its closing record high from February, before the onset of the coronavirus crisis in the United States that caused one of Wall Street’s most dramatic crashes in history.
The Dow Jones Industrial Average fell 104.53 points or 0.38% to 27,686.91; the S&P 500 lost 26.78 points or 0.80%,to 3,333.69; and the Nasdaq Composite dropped 185.53 points or 1.69% to 10,782.82. — Denise A. Valdez with Reuters
Peso weakens vs dollar on recovery in oil prices
THE PESO retreated against the greenback on Wednesday as oil prices corrected, with demand recovering on easing restriction measures amid the pandemic.
The local unit ended trading at P48.94 versus the dollar on Wednesday, weaker by two centavos from its P48.92 finish on Tuesday, data from the Bankers Association of the Philippines showed.
The peso opened the session marginally weaker at P48.925 against the dollar. Its weakest was at P49 while its strongest showing was at P48.92 versus the greenback.
Dollars traded inched up to $795.92 million yesterday from $743.4 million on Tuesday.
The slight depreciation of the peso came after an uptick in oil prices, said Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort.
“Peso was slightly weaker after global crude oil prices recently at five-month highs as many economies further reopen from lockdowns,” Mr. Ricafort said in a text message.
Reuters reported that oil prices inched up on Wednesday after data released showed crude inventories in the US dropped more than market expectations, which boosted sentiment that demand is recovering in the US.
Brent crude rose 15 cents or 0.3% to $44.65 a barrel by 0206 GMT. Meanwhile, the price of West Texas Intermediate oil increased 9 cents or 0.2% to $41.70 per barrel.
Crude stocks dropped by 4 million barrels last week, the American Petroleum Institute said on Tuesday. This is more than the 2.9 million expected decline by analysts.
Meanwhile, a trader attributed the peso’s weakness to risk-off sentiment amid the progress of relief packages in the United States.
“The peso depreciated slightly amid dimming prospects of a swift passage of a household and business fiscal relief package in the US Congress,” the trader said in an e-mail.
This Thursday, Mr. Ricafort expects the peso to move around the P48.90 to P49.05 band versus the dollar while the trader gave a forecast range of P48.80 to P49. — L.W.T. Noble with Reuters
Gov’t to pursue clinical trials for Russian COVID-19 vaccine
GOVERNMENT officials were set to meet with the maker of the Russian coronavirus vaccine on Wednesday to discuss how clinical trials can be started in the Philippines, Health authorities said.
“Let’s see what will result from the talks between Gamaleya and the Department of Science and Technology (DoST),” Health Undersecretary Maria Rosario S. Vergeire told an online news briefing on Wednesday.
The Russian vaccine is in the third phase of clinical trials, she said.
Ms. Vergeire said all clinical trials must be approved by the Food and Drug Administration and the Health department’s ethics board.
The Russian vaccine must be approved by local regulators even if it passes in Russia, she said.
“Whether or not we could actually use it will depend on compliance with our existing laws,” Presidential Spokesman Harry L. Roque told CNN Philippines.
Local Universities will also conduct clinical studies to check if the vaccine is harmless, he added.
Russian President Vladimir Putin on Tuesday said his country had developed the first vaccine for the COVID-19 virus.
Critics have questioned the safety of the experimental vaccine since vaccines take years to develop.
President Rodrigo R. Duterte in a speech on Monday evening said Russia had offered to give the Philippines COVID-19 vaccines, adding that he would volunteer to get injected in public.
He thanked Russia for supposedly offering to send the vaccines to the Philippines free of charge.
He said the Russian vaccines could arrive by September or October.
The Department of Health (DoH) on Monday said it had allotted P2.4 billion for COVID-19 vaccines in its budget for 2021 and this could change depending on the price.
China is the other country Mr. Duterte mentioned in the past that had pledged to prioritize the Philippines for coronavirus vaccine supplies once they develop one.
Meanwhile, four Philippines hospitals will join the trial for the Japanese flu drug Avigan as treatment for coronavirus, Ms. Vergeire told a separate news briefing.
These are the Philippine General Hospital, Sta. Ana Hospital, Dr. Jose N. Rodriguez Memorial Hospital and Quirino Memorial and Medical Center.
The trials would run for nine months,” she said at an online briefing, adding that the government had taken delivery of the drugs.
She earlier said the trial for Avigan would start on Aug. 17. The drug will be given to a hundred patients aged 18 to 74.
Patients who will participate must agree with the use of contraceptive and have no kidney and heart problems, among other requirements, she said.
Japan in April said it would send the drug manufactured by Fujifilm Toyama Chemical Co., Ltd. to 38 countries, including the Philippines after clinical trials. — Vann Marlo M. Villegas and Gillian M. Cortez
COVID-19 infections nearing 144,000, with 2,404 deaths — DoH
THE DEPARTMENT of Health (DoH) reported 4,444 new coronavirus infections on Wednesday, bringing the total to 143,749.
The death toll rose to 2,404 after 93 more patients died, while recoveries increased by 636 to 68,997, it said in a bulletin.
Of the new cases, 2,618 were from Metro Manila, 233 from Laguna, 227 from Cavite, 174 from Rizal and 129 from Bulacan, DoH said.
There were 72,348 active cases, 91% of which were mild, 7.3% did not show symptoms, and less than 1% each were severe and critical, it added.
Sixty-seven of the new reported deaths were from Central Visayas, 16 from Metro Manila, three from Zamboanga Peninsula, two each from Bicol, Western Visayas and the Davao region, and one from the Calabarzon region, the agency said.
More than 1.7 million people have been tested for the COVID-19 virus, DoH said.
The coronavirus has sickened 20.5 million and killed about 746,000 people worldwide, according to the Worldometers website, citing various sources including data from the World Health Organization.
About 13.5 million people have recovered, it said. Active cases stood at 6.3 million, while 14.2 million cases had been closed.
The US topped the global list with 5.3 million cases and more than 746,000 deaths. The Philippines ranked 22nd and was No. 1 in Southeast Asia. — Vann Marlo M. Villegas
23 million students register for school year 2020 to 2021
ABOUT 23 million students have enrolled, less than two weeks before classes open amid a coronavirus pandemic, the Department of Education said on Wednesday.
About four million students did not enroll, the agency said, adding that the registration rate was 83% of students who enrolled last year, Education Undersecretary Nepomuceno A. Malaluan told senators on Wednesday.
Out of 23 million basic education students, 21.4 million were enrolled in public schools, while the rest were in private schools, he told the Senate education committee.
About 333,000 students were under alternative learning systems, he added.
Mr. Malaluan said 22.5 million students enrolled in public schools last year, while 4.3 million were enrolled in private schools. He said public school students who enrolled were about a million fewer this year, while private school students were about 2.8 million fewer.
“To sum it up, we have an extraordinary nonparticipation on account of COVID, as of today, that is about four million learners,” Mr. Malaluan said in Filipino.
President Rodrigo R. Duterte locked down the entire Luzon island in mid-March, suspending work, classes and public transportation to contain a coronavirus pandemic. People should stay home except to buy food and other basic goods, he said.
He extended the lockdown for the island twice and thrice for Metro Manila. But the President put back Manila and nearby provinces under a strict lockdown until Aug. 18 after a fresh surge in infections.
Senator Sherwin T. Gatchalian, who heads the committee, said DepEd should consider postponing the opening of classes in high-risk areas.
“The reason why we moved to a modified enhanced community quarantine is because the situation is worsening and we need to arrest that situation,” Mr. Gatchalian said at the hearing. “How can we mobilize our teachers, if the situation is worsening?”
He also said the house-to-house distribution of the self-learning modules was disrupted by the stricter lockdown. While this may be lifted Aug. 19, teachers will only have five days to resume delivery before the Aug. 24 opening, he added.
“We don’t have any way of predicting after Aug. 19 if the situation will improve, Mr. Gatchalian said. — Charmaine A. Tadalan
Nationwide round-up
Drilon calls on PhilHealth officials tagged in alleged corruption to take a leave
SENATE MINORITY Leader Franklin M. Drilon called on Philippine Health Insurance Corp. (PhilHealth) officials tagged in alleged corrupt practices in the agency to take a leave while investigations are ongoing. In an online briefing Wednesday, Mr. Drilon said a leave of absence will prevent them from tampering with documents. Separate probes on PhilHealth are being undertaken by the two chambers of Congress as well as a special task force created upon the order of the President. Mr. Drilon also said there is no evidence so far that directly links PhilHealth President Ricardo C. Morales to the irregularities. “There is no evidence that Morales is directly involved, but it is clear to me that the people around him are doing something else. In street language, napapaikutan si Mr. Morales (is being deceived),” he said. Some PhilHealth officials, however, may be liable for graft for entering into disadvantageous contracts over the implementation of the Interim Reimbursement Mechanism (IRM) and procurement of overpriced items, he said. The IRM, which was meant to provide advanced payment to health facilities amid the pandemic, was allegedly used to benefit facilities that had no coronavirus disease 2019 patients. “What I can assert is the corruption is endemic and systemic… I doubt whether a change of president or board members would be sufficient,” he said. Senate Majority Leader Juan Miguel F. Zubiri, for his part, said the IRM should be suspended while the government determines the proper computation of the funds that should be released to medical institutions across regions. “We should suspend the release of the IRM until we can come out with the proper formula and accountability measures,” Mr. Zubiri said at a separate online briefing.
SPMC
Meanwhile, the Palace on Wednesday defended that there is “nothing irregular” in the Southern Philippines Medical Center (SPMC) having received the biggest IRM at P326 million considering that it is the biggest government-run hospital in the country. “Historically, SPMC has had the biggest amount of claims due to its regular provision of healthcare services to patients all over Mindanao,” he said. SPMC, located in President Rodrigo R. Duterte’s hometown Davao City, has a 1,500-bed capacity, almost 3,600 personnel, and several specialized institutes such as on heart, orthopedic and rehabilitation, cancer, and an isolation building for emerging and re-emerging infectious diseases. It was one of the first five medical facilities to be accredited for COVID-19 testing. It is also designated as the only COVID-19 referral hospital for Davao City, with all other hospitals just serving as back-up should patients exceed SPMC’s capacity. Mr. Roque said the hospital also has the highest PhilHealth income, reaching P1.2 billion in 2018-2019. — Charmaine A. Tadalan and Gillian M. Cortez
Roque says coronavirus situation ‘not as bad’, citing US, Brazil
PALACE SPOKESPERSON Harry L. Roque said the coronavirus outbreak in the country, with the number of cases the highest among southeast Asian nations, is “not as bad” when compared with the United States and Brazil — the two countries with the worst outbreaks globally. “We are not as bad as countries that we consider as role models, including the United States which has now the highest number of cases and the highest number of deaths,” he said in an interview with CNN on Wednesday. Mr. Roque added that in comparison with Brazil, which has a similar population density per area as the Philippines, the government here took steps that prevented millions in potential cases. The Philippines as of Aug. 12 ranked 22nd among 188 countries/regions in terms of positive coronavirus cases, based on the John Hopkins University’s Coronavirus Resource Center. — Gillian M. Cortez
46 immigration employees positive for COVID-19
THE BUREAU of Immigration reported on Wednesday that 46 of its employees, stationed at offices and airports around the country, have tested positive for coronavirus. In a statement, Commissioner Jaime H. Morente said none have died of the disease, nine have recovered, and the rest are still in quarantine facilities or hospital. “We are doing our best in seeing to it that health protocols aimed at preventing the spread of the virus are strictly observed in our offices and workplaces,” Mr. Morente said. Half of those who were infected are assigned at the main office in Manila and the rest are posted in international airports in Pasay City and Cebu, and satellite and extension offices. — Vann Marlo M. Villegas
PSA may seek partners soon for national ID
THE government is currently studying private-sector participation in the registration process for the national ID in 2021, and could begin a search for potential partners “soon,” the Philippine Statistics Authority (PSA) said.
In a text message Monday, National Statistician Claire Dennis S. Mapa said the agency will still conduct initial registrations this year but may conduct a parallel process next year with outsourcing partners.
“The PSA is open to this starting 2021. For this year, the PSA will do the registration process,” Mr. Mapa said.
The PSA is studying the feasibility of the two-track system and will start looking for potential partners “soon,” he said.
National Economic and Development Authority Acting Secretary Karl Kendrick T. Chua said last month that the PSA will consider outsourcing part of the registration work for the national ID system, formally known as the Philippine Identification System (PhilSys).
The PSA hopes to start registrations in November, focusing initially on heads of low-income households, particularly the unbanked.
The lack of a universally accepted ID has been blamed for the Philippines’ low levels of financial inclusion, with the unbanked unable to access financial services because of, among other reasons, bank requirements to produce multiple IDs to open an account.
During the pandemic, the distribution of cash aid to vulnerable communities was hindered by the government’s inability to compile lists of beneficiaries, which the national ID will address for future calamities.
A pilot test of the PhilSys pre-registration and the actual registration process was conducted in Marikina City late last month.
The government aims to register five million heads of household this year, 40 million next year and another 40 million in 2022.
The administration hopes to register “most” Filipinos before its six-year term ends in 2022.
The PSA is the main implementing agency of the PhilSys, while the central bank has been tasked to produce the blank cards for the ID.
President Rodrigo R. Duterte signed Republic Act No. 11055 in August 2018 to establish a single identification system for all citizens, eventually replacing redundant government-issued IDs. — Beatrice M. Laforga
PHL GDP could contract by 8-9% — FMIC
GROSS domestic product (GDP) in 2020 is likely to contract 8-9% due to the pandemic, positioning the economy for a rebound off a low base in 2021 with fundamentals largely intact, according to participants at a First Metro Investment Corp. (FMIC) briefing.
“The third quarter is still going to be negative and fourth quarter will be a much smaller negative depending on how firms and people respond to opening up the economy,” University of Asia and the Pacific (UA&P) Professor Victor A. Abola said at the FMIC’s virtual mid-year Economic and Capital Markets Briefing Wednesday.
FMIC’s original 2020 growth outlook was 6.2% issued in January. The 8-9% contraction forecast positions FMIC as far more pessimistic than the official government projection of -5.5%.
The investment banking unit of the Metrobank Group also expects cash remittances to shrink by 8% to 9% this year, much worse than the 5% contraction projected by the central bank.
Panelists at the briefing said the Philippines is in a stronger position compared to previous crises, with sufficient buffers to withstand the pandemic.
“The speed of recovery will depend on our quick and strategic moves to overcome the bottlenecks in supply chains, revising our business models, and the response to the digitization challenge,” Mr. Abola said.
Meanwhile, Bernardo M. Villegas, also of the UA&P, said the pandemic has shown what the country needs to pay more attention to, including food security and the development of critical technical skills.
Mr. Villegas said industries that will likely gain traction in a recovering economy are food and agri-business, health and wellness, and fields related to digitization and education. He said travel and tourism, retail, and restaurants will likely take a longer time to return to growth.
“Even when the vaccine is found, Filipinos will still be very hesitant to dine out to go to the mall,” he said.
Mr. Villegas also said the pandemic has clarified to investors the need to look outside Metro Manila. — Luz Wendy T. Noble
Mindanao spot market launch faces delays
THE low rates of registration by the Mindanao energy industry may further delay the launch of the electricity spot market in the region, according to the Independent Electricity Market Operator of the Philippines (IEMOP).
The independent operator of the Wholesale Electricity Spot Market (WESM) said it is on track to proceed with the operation of the Mindanao market on Dec. 26 despite low levels of participation so far.
“‘Pag ‘di pa nakumpleto ang registration by December, that’s an indication na baka ma-move pa further ‘yung commercial date ng Mindanao. But so far, nag-i-stick pa tayo sa December because ‘yun talaga ang government target (If registrations aren’t complete by December, the commercial launch in Mindanao could be moved back. But so far we are sticking to the government target)“ IEMOP Chief Operation Officer Robinson P. Descanzo said at a virtual briefing.
So far, participation in the trial run of the Mindanao market consisted of 12 grid-connected generation firms, three private distribution utilities, and four of the 28 embedded generators.
Three of 28 electric cooperatives and two of 13 directly-connected customers have also registered, while the rest have yet to complete their initial prudential requirements.
IEMOP noted some issues discouraging the power industry from joining the spot market.
Power utilities managing embedded generators are wary of the central dispatching set-up, which is needed to coordinate generation schedules.
“Ang bawat DU (distribution utlilities) kasi may kanya-kanya silang motor units na sila mismo nagma-manage ng operations ng mga embedded generators, so nasanay sila sa concept na ganun (DUs are used to managing their own operations),” Mr. Descanzo said.
They are also worried about incurring additional charges if their partner generators trade on the market.
“There are concerns na sinasabi ng DUs na even ang cost recovery ng generator na ‘yan binabayaran ko na. So, ‘pag naglaro siya (embedded generators) sa market, makakabenta siya sa labas, partly ako naman ang nag-subsidize (The concern is that they will partly be subsidizing power sold to external customers)“ Mr. Descanzo said.
The utilities also fear additional costs once the privately-owned National Grid Corp. of the Philippines (NGCP) assumes the role as the market’s sole metering service provider.
“According to them, may cost silang binabayaran na ‘di nila mare-recover… ang sinasabi nila baka magkaroon pa ng additional cost/charges ang NGCP sa kanila,” (There might be costs that they cannot recover in the process. They might incur additional charges from the NGCP),” he said.
He also noted that utilities are reluctant to relinquish their control over metering activities involving their partner generators.
IEMOP said the issues can be resolved through the on-going fine-tuning activities for the market and regulatory processes.
“Overall, makikita mo may benefit ka (you can see you will benefit) from the market; these little things, fine-tuning lang kailangan d’yan (is only needed),” he said.
Separately, he said WESM in Mindanao can proceed even if the Mindanao-Visayas Interconnection Project (MVIP) is not yet complete as the region has “excess” generation capacity.
“We can integrate Mindanao in the WESM even without the interconnection. The current situation there is mayroon tayong (we have) excess generation… ‘Di naman isyu na show-stopper ang delay ng interconnection (The delay of the project is not a deal breaker),” Mr. Descanzo said.
The Department of Energy has ordered the NGCP to fast-track its various interconnection projects, which were delayed by the pandemic and right-of-way issues.
The P52-billion MVIP, in particular, was said to be delayed for another year from its target launch in 2020.
Along with the new market, an ungraded WESM design, which will introduce a five-minute trading interval, is also being tested out to participants in the Luzon and Visayas markets. It is also expected to be launched by year’s end. — Adam J. Ang
Farm, fisheries ‘clustering’ to be required for some DA aid
THE government will help the agriculture sector achieve sufficient scale to better access financing and equipment under a program known as Farm and Fisheries Clustering and Consolidation (F2C2).
Agriculture Secretary William D. Dar issued an administrative order launching F2C2, calling it a measure to ensure food security during the pandemic.
Consolidated farms and fishing communities are expected to be easier to reach by government programs offering credit, training in modern production methods, machinery, and packaging support, among others.
“The F2C2 program is needed to enable the agriculture and fishery sector attain economies of scale, and thus achieve cost-efficient production, harvest, processing and marketing operations subsequently increasing farmers’ and fishers’ incomes,” Mr. Dar said.
Mr. Dar ordered his regional directors to establish at least two pilot F2C2 projects. Agriculture Undersecretaries Ariel T. Cayanan and Rodolfo V. Vicerra were tasked to lead the program’s advisory committee for its pilot implementation.
Mr. Dar said consolidating fragmented small farm holdings will be a challenge.
According to the Philippine Statistics Authority (PSA), the average farm size in the Philippines was 0.9 hectare in 2012 compared to three hectares per family in the 1980’s.
“Eight years ago, when the PSA survey was conducted, it showed the country then had 5.56 million farms, totaling 7.2 million hectares, of which 57% were one hectare or less, 32% were one to three hectares, 9% were three to seven hectares, and 2% seven hectares and more,” the Department of Agriculture (DA) said.
The DA added that fisherfolk remain dependent on small fishing vessels that are only capable of plying municipal waters.
The DA set eligibility criteria for F2C2 aid at 100 hectares for rice, fruit trees, perennials, and fiber crops; 75 hectares for corn and other grains; and 50 hectares for vegetables and other high-value crops.
Livestock producers must possess a feed mill within the production area while growers of ruminants should have a centrally-managed grazing land and feed production systems.
Raisers of free-range chicken and other livestock must also have well-delineated community growing territories.
Eligible fisherfolk must have community-based production zones or processing facilities or leases for a community fishpond.
“Cluster production areas must either be contiguous or in close proximity within a village. For areas that are not contiguous, these should be located within a municipality or congressional district,” the DA said. — Revin Mikhael D. Ochave