Philippines’ Social Security System (SSS) fund invests energy stocks

Philippines pension fund Social Security System (SSS) could increase investments in local equities by up to₱ 20 billion pesos ($470 million) and is particularly interested in energy stocks, its president and CEO said on Thursday.

The state-run fund for private sector workers, which has stakes in leading telecom Philippine Long Distance Telephone Co and top gold and copper miner Philex Mining Corp , expects to beat its net revenue target of ₱16 billion pesos this year given the stock market's rise to a record high.

SSS net revenue last year was ₱ 22 billion pesos.

"We should be able to do better than that," president and CEO Emilio de Quiros told a media forum, referring to this year's net revenue target.

"(Energy) is a sector that we are looking at, the potential is there. It's a sector that could provide good returns for us," he said, adding the fund may buy shares in initial public offerings of energy firms.

Food-to-power conglomerate San Miguel Corp said (July 7) it plans to list its energy unit, San Miguel Energy Corporation, this year.

De Quiros said the fund did not anticipate the stock market to hit new highs this year.

The Philippines' main stock index has risen more than 4 percent this year, hitting a record high on Tuesday (July 5). The market rose 63 percent in 2009 and 38 percent in 2010.

De Quiros said the fund's investments in stocks and government securities made up 21 percent of its investment funds of ₱286 billion pesos, below the 30 percent limit.

"We're examining very carefully whether we need to reallocate (investments) or increase a little. Right now, our investments are still doing well -- whether in mining, financials or telecom," he said.

The Philippines Stock Exchange wants to ease its listing and disclosure rules for petroleum and renewable energy firms, a sector seen as a growth driver for the bourse, the smallest amongst major Southeast Asian nations, and the economy.

Continue reading

World Bank hails steady Philippines' 2011 Economic growth

The World Bank on Wednesday praised the Philippines for its steady economic growth despite the global economic shocks and hailed reforms made by the government of President Benigno Aquino.

In its quarterly update, the bank said it expects Philippine economic growth to stabilize at 5.0 percent this year and rise to 5.4 percent next year. The economy grew 7.6 percent last year.

Manufacturing, construction, buoyant metals prices as well as a booming business process outsourcing industry are expected to be the main growth drivers, said World Bank senior economist Eric Le Borgne.

The body also cited potential gains from reforms put in place by Aquino who was elected in May, 2010.

"Prospects on the supply side remain favorable with manufacturing and construction projected to benefit from the end of the trade disruption linked to Japan’s post-disaster reconstruction," Le Borgne said in a statement.

The update also praised Aquino for his efforts to fight corruption, upgrade the country's infrastructure, and open up aviation to foreign competition to boost tourism.

World Bank country director Bert Hofman said the Philippines' recent performance, which saw 4.9 percent growth in the three months to March, suggests growth had become more robust and steady since the global crisis.

He cited a series of credit rating upgrades that put the Philippines' sovereign debt to within two rungs of investment-grade last month.

Aquino's office said in a statement that the World Bank report showed that the Philippines' economic fundamentals had "significantly improved" and that the government's programs were sound.

Manila has an "aspirational target" of 7-8 percent GDP growth for 2011 but projects more modest growth of 5-6 percent.

Continue reading

Philippines’ ₱ Peso at 2-months high on policy view; won near 34-mth peak

SINGAPORE: The Philippine peso hit a two-month high on Wednesday on views that the country may use the currency to fight inflation and the South Korean won flirted with a nearby 34-month peak as there was no sign Seoul was buying dollars.

Demand by real money accounts lifted most emerging Asian currencies, suggesting inflows to the region may continue over the medium term after the dame kind of investors cut exposure to the region last month.

The Philippine central bank (BSP) was spotted buying dollars, but they appeared to just slow down the peso's strength, not to defend a certain level, dealers said, after data on Tuesday showed the country's price pressures have been greater than previously reported.

"This morning BSP gave the cue when they stepped aside at 43.00. So BSP interventions more like leaning against the wind to limit the speed rather than a committed line in the sand," said Saktiandi Supaat, head of FX Research at Maybank in Singapore.

"Imported inflation seems to be a focus for now and using PHP to restrain it," he said, adding that the intervention could still substantially contain the appreciation.

Still, he sees the peso seen strengthening past this year's high of 42.635 per dollar by the end of August, barring no external shocks or line in the sand by BSP.

This year, unlike before, Asian foreign exchange authorities have allowed their currencies to strengthen in order to fight inflation, especially prices pressure from imports, although they have been spotted buying dollars to slow the gains.

The interventions have been seen just as efforts to contain gains, not to reverse a market trend or to defend certain levels, dealers said.

South Korea, which dealers said had intervened earlier this month, was not spotted buying dollars on Wednesday, despite heightening caution over their steps as the won threatened to touch a 34-month high hit on Monday.

Seoul has pledged to focus policy on stabilizing prices and there has been speculation among traders that the government was allowing the won's appreciation as a way to cushion imported inflation as overall consumer inflation stays stubbornly above the upper ceiling of the central bank's target.

The stance, which most Asian policymakers have taken, is seen supporting emerging Asian currencies, along with inflows to the region that has stronger economic fundamentals than developed markets have.

The regional units are expected to keep enjoying investment flows, although these may dip on concerns over the euro zone's debt crisis and a slowing global economy, analysts and dealers said.

"The market remains happy to sell USD/Asia bounces. We continue to see net equity inflows, perhaps a fresh quarter is seeing new money get put to work," said Westpac currency strategist Jonathan Cavenagh in Singapore.

PESO

The peso gained up to 0.5 percent to 42.83 per dollar, the strongest since May 4 on macro funds' demand and stop-loss dollar sales.

One-year dollar/peso non-deliverable forwards (NDFs) also slid 0.4 percent to 43.170, the lowest since June 10, catching up with the spot move.

Interbank speculators had built dollar-long positions on views that the central bank would defend the 43.00 line for the spot, but they had to clear those positions when no intervention was spotted at that level.

http://economictimes.indiatimes.com/markets/forex/peso-at-2-mth-high-on-policy-view-won-near-34-mth-peak/articleshow/9124211.cms

 

Continue reading