|
|
|
|
|
MANILA, June 26, 2012 - (ACN Newswire) - First Metro Investment Corp (FMIC) and University of Asia and the Pacific (UA&P) have published the May issue of "The Market Call, Capital Markets Research". The report, which covers the Philippines' Macroeconomy, Fixed Income Securities, Equity Markets and Economic Indicators, includes the following highlights:
"Macro-Economy: PH Shrugs Off Eurozone Crisis, Revs up to Fast Start -
The world economic slowdown notwithstanding, the economic performance of the country was off to a fast start. After all, first quarter Gross Domestic Product (GDP) growth was at 6.4%, second highest in Asia, tax revenues soared double-digit in Q1 and April when it posted the largest budget surplus since 2007, inflation up
by a modest 3.0% (year-on-year), and a credit rating improvement by Moody's from stable to positive.
The way-beyond-expectations GDP growth was underpinned by surging infrastructure expenditures and solid consumer spending. Besides, this occurred despite slow money growth, which in March moved up by less than 6%. The main bad news was the -1.2% slide in exports for the same month. On the whole, we see Q2 and the rest of the year to continue with the robust growth, as the government with a lot of money to spend and a slightly weakening peso would enable the economy to ride the momentum.
"Fixed Income Securities: The Bull's Indigestion -
Underlying economic fundamentals have never been better for interest rates and bond investments yet a widely expected decline yields cannot seem to materialize.
Inflation remains investor friendly hovering in the lower range of government targets, but investors have expressed wariness that the price level measure would
be moving higher. Generally, the market appears to be anxious with their existing bond positions indicating indigestion among the big players. The jumbo sized auction of retail treasury bonds early in the year may be taking their toll. With the yields in the long end bouncing up from their historical lows, many institutional investors are looking to bank in their profits while the opportunity still exists.
A P2.9 billion year to date fiscal surplus puts the National Government (NG) in a very comfortable cash position, giving it flexibility to accept or reject tenders that would raise borrowing costs significantly. This was demonstrated in rejections and partial awards in all four of the scheduled auctions this month.
"Equity Markets: Euro-zone Woes Pull Down Share Prices -
For the 3rd consecutive year, May continued to the bete noire month for bullish investors in the Philippine equities market. Uncertainty in the euro-zone (Greek exit and pain in Spain) have put global risky assets on a slippery slope. Moving forward, we remain constructive on the Philippine equities medium- to long-term due
to our robust economic and earnings outlook for 2012. First quarter Gross Domestic Product (GDP) surprised at 6.4%. And out of the 30 companies listed in the PSEi, only 2 (or 6.67%) reported lower-than-expected first quarter earnings. However, in the near-term, we view high risks to equitiesas an asset class due to the potential of malaise in the euro-zone.
To download this full Market call, and all recent reports, please visit http://firstmetro.com.ph/publications_marketcalls.asp.
Contact:
Anna Marie Tuprio
Corporate Planning & Affairs Department
Tel: +63-2-858-7951
E-mail: marie.tuprio@firstmetro.com.ph
Topic: Research / Industry Report
Source: First Metro Investment Corporation
Sectors: Daily Finance
http://www.acnnewswire.com
From the Asia Corporate News Network
Copyright © 2024 ACN Newswire. All rights reserved. A division of Asia Corporate News Network.
|
|
|
|
