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Asia stocks edge up as Syria worries diminish

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BANGKOK — Asian stock markets posted modest gains Thursday as the risk of U.S. military intervention in Syria appeared to diminish.

Diplomatic efforts to get Syria to turn over its stockpile of chemical weapons went into high gear Wednesday, easing fears that the U.S. would launch an attack. Washington has threatened to retaliate against Syrian President Bashar Assad for allegedly using chemical weapons against civilians outside Damascus last month.

President Barack Obama contends that chemical attacks pose a potential threat to the global community and retaliation is necessary. But he has faced an uphill battle trying to convince congressional leaders and U.S. allies to go along.

Hong Kong’s Hang Seng rose 0.4 percent to 23,019.37. South Korea’s Kospi advanced 0.5 percent to 2,013.70. Australia’s S&P/ASX 200 gained 0.3 percent to 5,247.70. But Japan’s Nikkei 225 index fell 0.3 percent to 14,382.92. A firmer yen hurt export shares.

On Friday, investors will be closely monitoring U.S. retail sales data for August as they gear up for next week’s policy meeting of the Federal Reserve.

Over recent weeks, the markets have priced in the likelihood that the Fed will start to reduce its monetary stimulus at the meeting. The main question for most traders is how much the current $85 billion of monthly asset purchases will be reduced.

On Wall Street, stocks mostly rose Wednesday as investors continued to bet that a U.S.-Syria military conflict may not happen. The Standard & Poor’s 500 index posted its seventh gain in a row after starting the day with a loss. The Nasdaq composite posted a small loss. Both indexes were held back by a decline in shares of Apple and other tech companies.

The Dow Jones industrial average rose 0.9 percent to close at 15,326.60. The Standard & Poor’s 500 index rose 0.3 percent, to 1,689.13. The Nasdaq composite fell 0.1 percent, to 3,725.01.

Benchmark oil for October delivery rose 6 cents to $107.61 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 17 cents to close at $107.56 a barrel on the Nymex on Wednesday.

In currencies, the euro rose $1.3320 from $1.3312 late Wednesday. The dollar fell to 99.50 yen from 99.87 yen.

Philippine stocks tumble on US Fed tapering

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MANILA, Philippines—Most local stock prices tumbled for the second straight session on Friday as jitters over the tapering of US Federal Reserve’s easy money policy intensified following better-than-expected US jobs data.

The main-share Philippine Stock Exchange slipped by 54.76 points or 0.83 percent to close at 6,525,95, tracking the bloodbath across regional markets.

For the week, the index was still a net gainer of 121.72 points or 1.9 percent.

Dealers said sentiment was affected by escalating jitters over US Fed tapering, which likewise caused an overnight slump on Wall Street. A surprise improvement in US jobless claims alongside rising inflation boosted expectations that the US Fed would indeed reduce its $85 billion monthly asset buying starting next month.

Turnover at the local market on Friday amounted to P5.58 billion. There were only 52 advancers versus 92 decliners while 40 stocks were unchanged.

Investors also continued to factor in global fund managers’ adjustment arising from the latest quarterly MSCI index review, which resulted in a 6.9 percentage cut on SM Investments’ weight to a pro-forma weight of about 8.72 percent. Overall, the Philippines’ weight on MSCI’s emerging market index was pared down to 0.95 percent from 1.02 percent effective September 2.

SM Investments (-1.18 percent), was the second most actively traded stock. “The reduction of MSCI weighting for SM has nothing to do with its business fundamentals. The fall in the share price is an opportunity to buy a growth stock at cheaper price levels,” said Jose Mari Lacson, head of research at Campos Lanuza & Co.

There were other index stocks that were more battered than SMIC. MPI and AEV fell by over 3 percent while RLC and JG Summit faltered by over 2 percent. Meralco, MWC, BPI and Jollibee also shed over 1 percent in their stock prices.

On the other hand, those that bucked the day’s downturn were Petron, Semirara, SMC, Belle, Metrobank and Ayala Corp.

As part of the MSCI realignment , there was an increase in the weight of Ayala Land Inc. by 1.05 percentage. The following companies will likewise see an upward weight adjustment in the MSCI Standard index: PLDT (+0.61%), BDO (+0.56%), ICTSI (+0.55%), SMPH (+0.51%), AC (+0.51%), URC (+0.50%), AEV (+0.45%), BPI (+0.31%) and AP (+0.29%).

On the MSCI Philippine small-caps index, there were weight increases for RCBC (+0.72%) and Vista Land (+0.05%).

Forex reserves climb to $82.9 B

 

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By Prinz P. Magtulis (The Philippine Star) | Updated August 8, 2013 – 12:00am

 

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MANILA, Philippines – The country’s foreign exchange reserves climbed in July after three straight months of decline on higher gold prices and continued inflow of dollars, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

Citing preliminary data, BSP Governor Amando M. Tetangco Jr. said the country’s gross international reserves (GIR) rose 2.08 percent to $82.942 billion in July from $81.255 billion in June.

The latest figure was a recovery from a 10-month low in June, but still below the record-high of $85.274 billion recorded in January this year.

“The increase was due to BSP’s foreign exchange operations and some revaluation gains at least for last month,” Tetangco told reporters on the sidelines of a budget briefing in Congress.

According to the central bank, reserves are now good to meet one year of imports of goods and services. They are also equivalent to 8.5 times the country’s short-term debt based on original maturity and 5.8 times on residual maturity.

Broken down, gold holdings posted the highest increase of 7.27 percent after it slumped to a two-year low the previous month. As of July, the value of gold reserves totaled $8.221 billion.

his was followed by foreign investments, where the bulk of the GIR is placed. A total of $71.760 billion were invested offshore, 1.58 percent up from end-June’s $70.645 billion.

Foreign exchange coffers – composed mainly of major currencies such as the dollar, euro and Japanese yen – inched up 0.84 percent to $1.155 billion for the first seven months.

Tetangco said the BSP’s foreign exchange was boosted by “foreign currency deposits from the Treasurer of the Philippines” as well as the “revaluation” of current holdings, primarily to account for stronger foreign currencies.

“These inflows were partially offset by the payments for maturing foreign exchange obligations of the national government,” he explained.

GIR is also composed of special drawing rights (SDR) – the currency used by the International Monetary Fund – as well as those funds actually lent to the multilateral agency.

Based on official figures, SDR holdings kept steady as of July at $1.261 billion, but the amount with the IMF increased 0.9 percent to $545.01 million.

Emperador spending P6B on Spain business

Posted on August 07, 2013 10:57:24 PM

LIQUOR MAKER Emperador International Ltd. is investing nearly P6 billion in its operations in Spain, parent Alliance Global Group, Inc. said in a statement attached to a disclosure yesterday.

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“Emperador International, a member of Alliance Global Group, will invest P5.8 billion in Spain over the next 12 months,” the statement read. “The investment is part of a dynamic strategy to build Emperador as a strong global brandy brand.”

According to Jorge Domecq Bohorquez, managing director of Emperador International, “part of the P5.8 billion has already been invested through Spain-based Bodega San Bruno S.A. and Grupo Emperador Spain S.A., which are both owned by Emperador.” Officials could not say how much had actually been spent for Bodega San Bruno and Grupo Emperador.

“We have completed the first phase of our acquisition, which includes a sizable inventory of high-quality, well-matured brandy, which are now being stored and aged in sherry casks, as well as 509 hectares of prime vineyard land in Toledo, Spain,” Mr. Domecq was quoted in the statement as saying.

Emperador Distillers, Inc. purchased Bodega San Bruno last January in a deal worth “not more than P3 billion,” according to a disclosure Alliance made that month.

The next phase of Emperador’s investment in Spain “includes the acquisition of even more vineyards and other brandy production facilities, which include distilling and bottling plants,” the company said.

Due diligence is currently being conducted for the said acquisition, it noted.

“Our next steps forward will further strengthen our position as the world’s no. 1 brandy company by volume, and make us exceptionally competitive as a global brandy producer,” Mr. Domecq added.

The official said the company is also looking to expanding the distribution network of Emperador Deluxe Spanish Edition, a brandy produced and bottled in Spain.

“We launched Emperador Deluxe early this year to a very warm reception and the response of the Philippine market continues to be very good,” Mr. Domecq said.

“We are looking closely into tapping other Asian markets such as China and Vietnam, initially.”

Alliance Global, the holding firm of tycoon Andrew L. Tan, booked a net profit of P4.91 billion in the first quarter, up by 18.31% from P4.15 billion in the same period last year on the back of higher revenues.

In the same comparative periods, Emperador Distillers net profit jumped by 40% to P1.4 billion from P1 billion as revenues rose by 17% to P6.5 billion from P5.5 billion, according to a statement last May.

Shares of Alliance ended yesterday’s trading at P26 apiece, unchanged from their finish last Monday. — Cliff Harvey C. Venzon

National Book Store to list on stock exchange

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MANILA, Philippines—The Ramos family has finalized plans to list its flagship retailing, publishing and allied businesses through the backdoor of the local stock exchange using Vulcan Industrial and Mining Corp., which will be renamed National Book Store Retail Corp.
In a disclosure to the Philippine Stock Exchange on Thursday, Vulcan said its board had agreed to endorse during the stockholders meeting on May 29 an increase in capital, the subscription by National Bookstore Inc. to such capital hike, the spin-off of mining and oil-related assets and the change in the company’s primary purpose from mining to retail and relegation of mining and oil exploration as secondary purposes.
Under the proposed framework, National Book Store will acquire new shares in Vulcan at P1 per share out of the increase in authorized capital stock to P4 billion from P600 million. This will be done through the conversion to equity of its advances amounting to P363.94 million; and cash subscription of up to P3.036 billion.
Likewise approved as part of the agenda was the change in the name of the corporation to reflect the entry of National Book Store and the waiver of rights offer relative to the increase in capital via additional subscription by National Bookstore and assignees.
Apart from retailing, the board agreed to propose the inclusion among the new secondary purposes of the company wholesale, publishing, printing, manufacturing, distribution, contracting and other activities.