How PSEi member stocks performed — July 2, 2020
Here’s a quick glance at how PSEi stocks fared on Thursday, July 2, 2020.
PSE index climbs on positive data, vaccine hopes
LOCAL SHARES rose on Thursday on the back of positive investor sentiment, particularly from foreigners, due to improved manufacturing figures and positive trials for a coronavirus disease 2019 (COVID-19) vaccine.
The bellwether Philippine Stock Exchange index (PSEi) gained 154.37 points or 2.48% to close at 6,364.08 on Thursday. The broader all shares index likewise increased 66.23 points or 1.81% to end at 3,716.98.
“The market jumped by more than 100 points as foreigners turned out to be net buyers for the day. This may be due to a lot of economic reports from major economies being released, which point to better-than-expected performance,” Timson Securities, Inc. Trader Darren T. Pangan said in a text message.
After the resumption of most economic activity across the world in May, manufacturing data for the month of June started to improve, with the Philippines recording a Purchasing Managers’ Index of 49.7 last month from 40.1 in May. Global economies such as Germany, United States, France and China similarly reported improvements.
Foreign investors recorded their second day of net buying at the PSE on Thursday. Net buying stood at P59.32 million, albeit lower from the previous day’s P6.24 billion.
Uptrends were also recorded in global markets, both in Wall Street on Wednesday and in Asian stocks on Thursday.
The S&P 500 and Nasdaq Composite indices climbed 0.50% and 0.95% on Wednesday. In Asia, Japan’s Nikkei 225 and Topix indices increased 0.11% and 0.27% respectively, China’s Shanghai Shenzhen CSI 300 index rose 2.07%, and South Korea’s Kospi index grew 1.36% on Thursday.
For Philstocks Financial, Inc. Research Associate Claire T. Alviar, the optimism was likewise boosted by hopes of finding a vaccine to COVID-19 after reports of positive human trials by Pfizer, Inc. and BioNTech SE.
“Investors around the world are closely monitoring developments on the COVID-19 pandemic, and they await vaccine as this will strengthen the economic recovery. Without a vaccine, recovery is still uncertain as resurgence of cases bring fears to the investors,” she said in a text message.
The global COVID-19 tally reached 10.7 million as of Thursday with casualties reaching 516,255 individuals.
Most sectoral indices at the PSE ended the trading session in green territory. Financials rose 41.13 points or 3.32% to 1,276.99; services improved 34.02 points or 2.43% to 1,431.39; property climbed 71.77 points or 2.33% to 3,144.01; industrials gained 182.13 points or 2.33% to 7,996.29; and holding firms increased 125.74 points or 1.96% to 6,539.2.
The sole declining index was mining and oil, which shed 27.17 points or 0.52% to close at 5,192.20 at the end of Thursday’s trading.
Value turnover stood at P7.35 billion, down from the previous day’s P15.66 billion, with 761.37 million issues switching hands.
Advancers bested decliners, 132 against 61, while some 46 names ended unchanged. — Denise A. Valdez
Peso strengthens on BoP surplus
THE PESO continued to strengthen versus the greenback on risk-on sentiment amid the wider balance of payments (BoP) surplus in May and dovish signals from the US Federal Reserve.
The local unit closed at P49.73 against the dollar on Thursday, stronger by nine centavos from its P49.82 finish on Wednesday, data from the Bankers Association of the Philippines showed.
The peso opened Thursday’s session at P49.77 per dollar. Its intraday low was at P49.82 while its strongest showing was its close of P49.73 against the greenback.
Dollars traded went down to $615.66 million on Thursday from the $681.45 million on Wednesday.
The peso’s strength was supported by the wider BoP surplus as well as improved manufacturing data, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.
“The peso exchange closed at its strongest since June 14 when it closed at P49.505 after wider BoP surplus data and improved global market risk after improvements in manufacturing data for most countries,” he said in a text message.
Bangko Sentral ng Pilipinas data showed BoP stood at a surplus of $2.431 billion in May, wider than the $928-million surfeit seen a year ago as well as the $1.666-billion surplus logged in April.
The May surplus is also the highest since January 2019’s $2.704-billion surfeit.
Meanwhile, a trader attributed the peso’s climb to dovish signals from the US Fed.
“The peso strengthened after the latest Fed minutes signalled that US monetary policy will likely remain highly accommodative for several years,” a trader said in an e-mail.
Reuters reported that minutes from the Fed’s June 9-10 meeting showed policy makers “generally indicated support” for tying rate-setting policy to economic outcomes.
The minutes also noted officials are seeing an economic downturn in the US which is the worst since World War 2. With this, they expressed no intent to let up on providing stimulus for the foreseeable future.
For today, Mr. Ricafort gave a forecast range of P49.60 to P49.85 while the trader expects the peso to move around the P49.60 to P49.80 levels versus the dollar. — L.W.T. Noble with Reuters
MRT-3 may cut operations after COVID-19 outbreak among staff
THE government may cut the capacity of the Metro Rail Transit System Line 3 (MRT-3) after a coronavirus outbreak among its depot staff, according to the Department of Transportation.
Infections among staff members at the rail’s North Avenue depot in Quezon City have risen to 127, Transportation Undersecretary Timothy John R. Batan said at an online news briefing on Thursday.
He said 124 of those who had tested positive for the virus were employees of MRT-3’s maintenance providers Sumitomo Corp., Mitsubishi Heavy Industries Engineering, Ltd. and TES Philippines, Inc.
“This coming Monday, we might cut the number of operating trains because a number of our maintenance personnel are on quarantine,” Mr. Batan said in Filipino.
MRT-3 has carried 67,821 passengers at its reduced capacity of 13% or 153 passengers per train, down from 1,182 passengers per train before the pandemic, the Transportation department said.
Mr. Batan said additional measures would be taken during MRT-3’s reduced operations, including requiring full personal protective equipment for stations and depot personnel.
The movement of depot workers would also be limited, there would be increased disinfection activities and heightened screening for coronavirus symptoms, he said.
The MRT-3 tests started after a worker of Sumitomo tested positive during the first batch of testing on June 11. The patient’s last day at the depot was June 8.
Rail management said the affected workers had not been in direct contact with station workers and passengers.
The rail system runs 12 to 15 train sets since the lockdown in Metro Manila was eased to a general community quarantine this month.
The Transportation department earlier said it would boost its bus augmentation to make up for the MRT-3’s reduced capacity.
Meanwhile, the National Irrigation Administration central office in Quezon City was locked down after three employees tested positive for the novel coronavirus, it said in a statement.
Work-from-home arrangements would be in place from July 1 to 7 except for essential workers who still have to report to work, it said. The central office would also enforce a skeletal workforce from July 8 to 14, it added.
The agency said the three employees who tested positive for the virus had not reported to work since last month. It said it had followed protocols including rapid test for all its workers.
The first batch of workers had tested negative for the virus, it said. A number of workers had also tested positive and would be tested further, it added.
The agency said it had disinfected its vehicles and buildings and installed protective coverings to prevent the spread of the COVID-19 virus.
Employees had been given face shields, face masks, hygiene kits and multivitamins, while every office was given a germicidal UV light.
Ricardo R. Visaya, the agency’s administrator, urged all employees to observe precautions to minimize the outbreak. — Arjay L. Balinbin and Revin Mikhael D. Ochave
COVID-19 infections near 39,000 as death toll increases to 1,274
THE Department of Health (DoH) reported 294 new coronavirus infections on Thursday, bringing the total to 38,805.
The death toll rose to 1,274 after four more patients died, while recoveries increased by 235 to 10,673, it said in a bulletin.
Of the fresh cases, 10 were from the capital region, 17 were returning overseas Filipinos and the rest were from outside the metro.
Of the late cases, 50 were from capital region, 164 were returning Filipino workers and the rest came from outside the region.
Of the new cases, 52 were reported in the past three days, while 242 were reported late, DoH said.
The fresh cases came from the reports of 58 of 72 laboratories, Health Undersecretary Maria Rosario S. Vergeire told an online news briefing.
She traced the decrease in new cases to the adjustment in data collection from 24 to 19 hours.
“This will give the Epidemiology bureau more time for a more in-depth analysis of data that we release,” Ms. Vergeire said in Filipino “This is temporary and we seek to give more timely data in the coming days.
The coronavirus has sickened 10.8 million and killed about 519,000 people worldwide, according to the Worldometers website, citing various sources including data from the World Health Organization.
More than six million people have recovered from the illness, it said.
Kim Carmela D. Co, a professor from the University of the Philippines-College of Public Health, said the delay in results stalls government response to control the pandemic.
The government should boost testing capacity and improve data collection at all levels, she told the same briefing. — Vann Marlo M. Villegas
Palace to review bill versus terror before it lapses into a law
MALACAÑANG will review the anti-terror bill that Congress had passed, a week before it lapses into law.
A copy of the measure that critics have said arms the state to violate human rights had been sent to Executive Secretary Salvador C. Medialdea for a final review, Presidential Spokesman Harry L. Roque told an online news briefing on Thursday.
The palace’s deputy secretary for legal affairs has already reviewed the bill, he said.
“There is a memorandum recommending a course of action to the President,” Mr. Roque said in Filipino. “This is subject to final approval by the executive secretary and this will be sent to the President’s desk.”
He did not say what the recommendation was.
The House of Representatives last month adopted the Senate version of the bill that it approved in February.
The measure will lapse into law on July 9 if President Rodrigo R. Duterte fails to sign or veto it.
Mr. Roque had said the President was inclined to sign the measure despite objections from militant groups.
The bill allows the government to arrest terror suspects without a warrant.
It also lets an Anti-Terror Council (ATC) made up of Cabinet officials to do functions otherwise reserved for courts, such as ordering the arrest of suspected terrorists.
It also allows the state to keep a suspect in jail without an arrest warrant for 14 days from three days now.
It also considers attacks that cause death or serious injury, extensive damage to property and manufacture, possession, acquisition, transport and supply of weapons or explosives as terrorist acts. — Gillian M. Cortez
#COVID-19 Regional Updates (07/02/20)
COVID task force optimistic of containing virus spread in Cebu City by July 15
THE GOVERNMENT is optimistic that measures currently being rolled out will contain the coronavirus disease 2019 (COVID-19) outbreak in Cebu City, which has the highest recorded cases among urban areas in the country as of July 1 at 6,175, of which 3,440 are active. In a briefing on Thursday, Interior Secretary Eduardo M. Año said the strict quarantine rules and response measures being taken in the city are “going towards the right direction” and they are hoping to ease restrictions by July 15. “Hopefully by July 15, maka-graduate (Cebu City can graduate) from ECQ (enhanced community quarantine),” he said. Cebu City has been placed under intense lockdown, with the national government deploying military and police reinforcements to ensure people follow health protocols. — Gillian M. Cortez
Nationwide round-up
Cash benefits for medical frontliners hinges on Bayanihan 2 law
HEALTH WORKERS who are at the frontlines of the coronavirus fight may not get cash benefits if they fall critically ill or die from the disease without the passage of the proposed Bayanihan 2 law. Health Undersecretary Maria Rosario S. Vergeire said they intend to continue giving cash benefits to affected health care workers, but there has to be a law that would direct it after the Bayanihan To Heal As One Act expired last month. “Hanggang hindi natin napapatupad uli or nakakapaglabas uli ng another law for such para maging basis natin, mahihirapan kaming makapaglabas ng ganyang amount (Until we have another law to use as basis, we will have difficulties releasing such amounts),” she said in a virtual briefing. Under the expired Bayanihan law, the families of frontliners who died in the line of duty received P1 million, while those who were infected and classified as severe cases got P100,000 each. Department of Health data as of June 29 show 3,372 health care workers have contracted the disease, 34 of them died.
SPECIAL SESSION
Presidential Spokesperson Harry L. Roque on Thursday said President Rodrigo R. Duterte will call for a special session for the passage of the Bayanihan 2 law, possibly before he delivers his 5th State of the Nation Address at the end of the month. Majority Leader and Leyte Rep. Ferdinand Martin G. Romualdez said the House of Representatives is ready to pass the proposed Bayanihan 2, which extends the special powers granted to Mr. Duterte to address the coronavirus virus crisis as well as outlines response and economic recovery measures. “The House leadership under Speaker Alan Peter Cayetano is committed to approve the Bayanihan to Recover as One Bill,” Mr. Romualdez said in a statement. Senate President Vicente C. Sotto III on June 30 said the executive department has transmitted to the Finance committee its proposed amendments to the measure. The bill includes a P140-billion standby fund to grant emergency subsidies to low income households, cash-for-work programs, and capital infusion to government financial institutions, among other assistance. — Vann Marlo M. Villegas, Charmaine A. Tadalan, and Gillian M. Cortez
Port monitoring tightened vs pork products from China
QUARANTINE PROTOCOLS and monitoring at ports have been tightened to ensure no pork products from China enter the country after the reported new swine flu that could possibly cause another pandemic, according to Agriculture Secretary William D. Dar. In a briefing on Thursday, he also appealed to importers and other enterprises to stop smuggling pork items. “Huwag nating dagdagan ang problema sa bansa (Let’s not add to the problems in our country),” he said. Pork products from China have been banned since the Asian swine fever outbreak in July last year, which continues to affect hog raisers in some parts of the country. — Gillian M. Cortez
Palace lists donated PPE, other medical supplies
MORE THAN seven million pieces of personal protective equipment (PPE), among other medical supplies, have so far been donated to the Philippines as it battles the spread of the coronavirus. “According to Department of Health, as of June 26, 2020, these are some of the medical products that were donated: Surgical masks — 6,425,950; N95 masks — 390,440; the ventilators are 201; and PPEs and medical coveralls, Palace Spokesperson Harry L. Roque reported in a briefing Thursday. The donors include foreign governments, multilateral organizations, and private sector. — Gillian M. Cortez
Gov’t to review guidelines on film, audiovisual production
THE GOVERNMENT will consult entertainment industry groups and review the guidelines for film and audiovisual production, which has been denounced as detrimental to the sector. “Titignan po natin kung meron pang mga dapat repasuhin sa mga guidelines (We will see if there is something needed to be reconsidered in the guidelines),” Palace Spokesperson Harry L. Roque said in a briefing Thursday. The new protocols for production work amid the continued threat of the coronavirus are contained in a joint order issued by the Film Development Council of the Philippines (FDCP), the Department of Health, and the Department of Labor and Employment. Mr. Roque said these agencies will be holding discussions with the Philippine Motion Picture Producers Association; the Inter-Guild Alliance of the film, television and advertising industry; and Directors Guild of the Philippines. — Gillian M. Cortez
Gov’t considering easing cap on dine-in, hotel operations
THE government is considering increasing restaurant dine-in capacity and resetting the level of permitted hotel activity in areas under general community quarantine (GCQ), Trade Secretary Ramon M. Lopez said.
Mr. Lopez said in a radio interview Thursday that there is still no timetable for increasing the current cap on dine-in capacity of 30% because the shift to modified general community quarantine (MGCQ) for parts of the country has yet to be scheduled.
Restaurants are currently allowed to fill 30% of their dine-in capacity in areas under GCQ, and up to 50% in areas under MGCQ. In a Laging Handa briefing Thursday, Mr. Lopez said the authorities are considering increasing capacity to 40% or 50% in areas under GCQ.
He said in a statement that the trade and tourism departments are considering allowing more capacity in hotel operations as well, subject to compliance with health guidelines.
Areas under GCQ include Metro Manila, Benguet, Cavite, Rizal, Leyte, Southern Leyte, Ormoc, Mandaue City, Lapu-Lapu City, Talisay City, Minglanilla, Cebu, and Consolacion, Cebu. The rest of the country is under MGCQ except for Cebu City, which is under the stricter enhanced community quarantine.
The Department of Finance has requested bringing forward the shift to MGCQ in Metro Manila and the CALABARZON region to jump-start the economic recovery.
Mr. Lopez, in a message to reporters, said that the trade department is working on increasing current levels of business activity under GCQ and the request for an earlier move to MGCQ.
“But this levelling of quarantine (is) mostly data and science-driven. Nothing much we can do on this,” he said.
“What we can do is work on increasing the current operating capacity and to reopen more businesses where health protocols can be more effective.”
He said in the briefing that he will also present to the Inter-Agency Task Force on Emerging Infectious Diseases (IATF-EID) the possible reopening of travel agencies after an industry association indicated that agencies have taken a big financial hit from refunding canceled bookings.
“Dati ho talaga nilagay sa Category 4 thinking kasi na under GCQ wala naman travel activities. Pero kung meron mga ganitong problema na kailangan i-solve, siguro pwede naman i-consider din ‘yan under the GCQ (The industry was placed in category 4 of low-priority businesses under GCQ because we thought there was no travel going on. But now that the industry has reported problems that need to be resolved, we might consider allowing them to reopen).”
Mr. Lopez said the authorities are also studying increasing the types of services that can be performed by salons and barbershops. — Jenina P. Ibañez
PCCI urges gov’t to ease travel curbs to aid airlines
THE Philippine Chamber of Commerce and Industry (PCCI) called for the easing of travel restrictions in order to aid the recovery of airlines.
In a statement Thursday, the PCCI said it is supporting the Air Carriers Association of the Philippines’ request to gradually phase out the quota for international passenger arrivals, resume international business travel, and allow some local air travel.
PCCI also supported bilateral arrangements with selected countries to fast-track non-leisure travel and re-open some tourist destinations.
“The status quo could prove fatal not only to the airline operators but to airline suppliers and the whole air transport supply (chain) reliant on continuing to deliver new equipment and supplying spare parts and maintenance services, as well as enterprises, a number of which are small and medium-sized enterprises (SMEs) that provision each flight — manufacturers and/or suppliers of food products, cutlery, sanitary paper, water, blankets, cleaning and maintenance services, etc.,” PCCI President Benedicto V. Yujuico said.
“These SME suppliers of goods and services are dependent on the operation of the aircraft to remain in business.”
The PCCI offered to assist the Inter-Agency Task Force on Emerging Infectious Diseases (IATF-EID) in easing restrictions for business travelers.
“The IATF-EID is also looking at allowing passengers to take their COVID-19 test abroad one to two days before their departure. As an active member of the Confederation of Asia-Pacific Chambers of Commerce and Industry (CACCI) and the International Chamber of Commerce (ICC), PCCI can assist in the proposal to secure a letter of invitation to establish the nature of travel of business people,” Mr. Yujuico said.
The PCCI also said that Philippine carriers should be given preference in traveler quota allocations for direct or connecting flights.
“This Philippine air carriers-first allocation should be extended to foreign business travelers once restrictions on business travel are lifted,” Mr. Yujuico added.
The travel industry is poised to lose $7.7 billion or 2% of GDP after a four-month tourism standstill, the United Nations Conference on Trade and Development (UNCTAD) estimated in a report issued July 1.
The four-month pause likely caused a 3% drop in the wages of skilled workers, while pay for unskilled work fell 4%. The Philippines is the 14th most-affected country in terms of unskilled employment in the UNCTAD report, which looked at 65 countries and regions. — Jenina P. Ibañez
Justice department issues rules on criminal prosecutions for Competition Act violators
THE Department of Justice (DoJ) issued a circular approving the rules implementing the criminal provisions of Republic Act No. 10667 or the Philippine Competition Act (PCA).
According to Department Circular No. 016, the DoJ’s Office for Competition (OFC) will conduct preliminary investigations and prosecute criminal offenses identified in the competition law.
Covered offenses include entering into anti-competitive agreements which restrict competition as to price or other forms of trade among others, and agreements fixing prices at an auction or in any form of bidding including cover bidding, bid suppression, bid rotation, and market allocation and other forms of manipulation.
Offenses also include entering agreements that set, limit or control production, markets, technical development or investment, and those that divide or share the market, “whether by volume of sales or purchases, territory type of goods or services, buyers or seller or any other means.”
“A criminal action based on covered offenses under Sections 1 and 2 of Rule II shall forever be barred, unless commenced within five (5) years from the time the violation is discovered by the offended party, the authorities or agents,” according to the circular.
Under PCA Section 30, entities are subject to fines while responsible officers and directors are subject to imprisonment.
An entity charged in a criminal proceeding may enter a plea of Nolo Contendere, signifying neither acceptance nor denial of responsibility for the charges, though it accepts the punishment “as if a plea of guilt has been entered.”
“The plea cannot be used against such an entity in a suit for civil liability arising from the criminal action or in another cause of action: Provided that a plea of Nolo Contendere may be entered only up to arraignment and subsequently, only with the permission of the court.”
The OFC may also grant immunity from prosecution from covered offenses and recognize immunity granted by the Philippine Competition Commission.
Qualified for immunity under the leniency program are respondents in a complaint over anti-competitive agreements in exchange for voluntary disclosure of information regarding the agreement.
The circular takes effect in 15 days days after publication in a newspaper. — Vann Marlo M. Villegas
Chua says Public Service Act amendments top FDI priority
AMENDING the 83-year-old Public Service Act (PSA) will be a key milestone in capturing more foreign investment in the post-pandemic era, Socioeconomic Planning Secretary Karl Kendrick T. Chua said.
“Number one is the Public Service Act that will help us clarify what is a public utility and what is not a public utility, and a lot of these, in particular, telecoms, will be instrumental in maintaining productivity in the new normal,” he said.
A pending measure seeks to amend Commonwealth Act No. 46 by clearly defining “public services,” which is currently interpreted as including “public utilities.”
If passed, the definition of public utilities will be limited to power transmission and distribution and waterworks and sewerage systems, allowing more foreign investment in telecoms.
At present, public utilities are subject to a foreign equity cap of 40% as provided for under the 1987 Constitution.
Mr. Chua was speaking during a House Economic Affairs committee hearing, during which he was asked for his recommendations for capturing a larger share of foreign investment.
“With this pandemic, how can we stay on track and make the Philippines an attractive destination for FDI (Foreign Direct Investment) to come in,” Nueva Ecija Rep. Rosanna V. Vergara said in the hearing.
Mr. Chua also cited the proposed Corporate Recovery and Tax Incentives for Enterprises Act, which is the revised version of the Corporate Income Tax and Incentives Rationalization Act (CITIRA).
“We recognize that tax incentives are important; however, the present design is not going to attract investors in the same way as other countries do because our present incentive are one-size-fits all,” Mr. Chua said.
He said the current system offers a four to six year income tax holiday, followed by a 5% tax on gross income earned across all industries and regions.
“What we are proposing is that we have targeted incentives by region and by industry.”
The PSA amendments and CITIRA bill have both hurdled the chamber, as House Bill Nos. 78 and 4157, respectively, and are pending in the Senate. — Charmaine A. Tadalan