Philippine tycoon postpones USD 474 million prime infrastructure IPO

MANILA, Oct 10 (Reuters) – Philippine tycoon Enrique Razon has delayed to the middle of next year plans to launch an up to 28 billion pesos (USD 474 million) listing for his infrastructure and energy holding firm because of a market downturn, its underwriter said on Monday.

The initial public offering (IPO) of Prime Infrastructure Capital Inc, originally set for October, could have been the Philippines’ largest this year.

“We will wait for the markets to recover,” Eduardo Francisco, president of deal underwriter BDO Capital, told reporters at the sidelines of a media forum.

The earliest an IPO for Prime Infrastructure could occur would be May or June next year, enough time to wait for global economy to rebound, inflation to ease and markets to recover, Francisco said.

Eight companies, mostly small firms, have listed in the Philippine bourse, whose broader index .PSI has fallen 18% and is Southeast Asia’s second worst performer year-to-date.

In June, Prime Infrastructure filed its listing documents with the corporate regulator. It planned to sell up to 1.93 billion shares, including an over-allotment option, at a maximum price of 14.60 pesos each. In Philippine filings, IPO prices are typically set above final selling prices.

Prime Infrastructure planned to use IPO proceeds to finance its energy, water, and waste and sustainable fuels businesses.

Razon, who Forbes says is the second-richest person in the Philippines with a net worth of USD 5.6 billion, built his fortune through global port operator International Container Terminal Services and casino owner Bloomberry Resorts.

(USD 1 = 58.9990 Philippine pesos)

(Reporting by Neil Jerome Morales; Editing by Ed Davies)

China stocks slump to half-year lows as COVID, US crackdown weigh

SHANGHAI, Oct 10 (Reuters) – China stocks tumbled to half-year lows on Monday, dragged by semiconductor giants and consumer firms, as trade resumed after a week-long holiday with the market being dominated by concerns over the latest US crackdown on the chip-making industry, weak economic data and fresh COVID-19 cases.

** The blue-chip CSI 300 Index slumped 2.2% to the lowest level since April 3, and the Shanghai Composite Index lost 1.7% to trade below the key 3,000 points psychological line.

** The Hang Seng Index declined 3%, while the Hang Seng China Enterprises Index plunged 3.2%.

** Global stocks skidded lower after a surprise drop in US unemployment quashed any thought of a pivot on policy tightening ahead of an inflation reading, which is expected to see core prices move higher again.

** China’s domestic COVID-19 situation worsened over the National Day Golden Week, during which holiday tourist trips also went down 18.2% from last year as strict anti-virus rules discouraged movement.

** Consumer staples and tourism companies tumbled 2.8% each, while media shares shed 2.1%, as box office sales plunged over the holiday.

** Furthermore, a private-sector business survey showed on Saturday that China’s services activity in September contracted for the first time in four months.

** An index measuring China’s semiconductor firms tumbled 7.1%, and Shanghai’s tech-focused board STAR Market declined 4.5%.

** The Joe Biden administration published a sweeping set of export controls on Friday, including a measure to cut China off from certain semiconductor chips made anywhere in the world with US equipment, to slow Beijing’s technological and military advances.

** However, Chinese real estate developers rose 1% following the country’s latest measures to prop up the distressed property sector.

** Beijing is ramping up efforts to boost home sales by easing mortgage rate floors, cutting interest rate on provident fund loans and offering individual income tax rebates for home buyers.

** Premier Li Keqiang said China will strive to consolidate its economic recovery as the country’s development faces difficulties and challenges.

** Energy suppliers also jumped 1.9%, as Chinese industry players catched up with global peers’ gains made over the holiday.

** Tech firms listed in Hong Kong tumbled 4%, with food-delivery giant Meituan down 6.7%.

** “Overall valuation in China’s stock market is attractive from a long-term perspective,” said analysts at China Asset Management Co. “Key indexes are bottoming, while a turning point will depend on domestic and overseas policies.”

** They added that once the US inflation data peaked, the Wall Street will likely see a rebound, which can help improve global risk appetite.

(Reporting by Shanghai Newsroom; Editing by Sherry Jacob-Phillips)

German bond yields edge lower as explosions rock Kyiv

LONDON, Oct 10 (Reuters) – German government bond yields edged lower on Monday after blasts rocked the Ukrainian capital Kyiv and other major Ukrainian cities, prompting a move into traditional safe-haven assets such as core government bonds.

Large explosions shook Kyiv and other cities on Monday morning in apparent Russian revenge strikes after President Vladimir Putin declared an explosion on the bridge to Crimea to be a terrorist attack.

Weak services data from China, renewed COVID concerns in the country and a set of new export controls introduced by the Biden administration, including a measure to cut off China from certain semiconductor chips, were also weighing on sentiment, according to Mizuho rates strategist Evelyne Gomez-Liechti.

“The Crimean bridge and the explosions really didn’t fit well with risk sentiment,” Gomez-Liechti said.

“Those are the drivers that have probably hurt sentiment and are driving some strength in the bond markets.”

By 0800 GMT, Germany’s 10-year government bond yield, the euro area’s benchmark, was down 3.5 basis points at 2.16%. Bond yields move inversely to prices.

Germany’s 2-year yield was down 8 bps to 1.783%.

US government bond markets are closed on Monday for the Columbus Day holiday.

Euro zone government bond yields had jumped on Friday after strong US jobs data dampened expectations that the Federal Reserve will slow the pace of interest rate hikes.

Nonfarm payrolls increased by 263,000 last month, the US Labor Department said, above expectations of 250,000 in a Reuters poll.

“The accelerating sell-off on Friday underscores how data-sensitive the market remains,” said Commerzbank rates strategist Rainer Guntermann in a note.

Guntermann highlighted that the unemployment rate declined back to a record low which provides “no evidence for the Fed to slacken the fight against inflation”.

Investors were now bracing for key US inflation data on Thursday this week for clues on the size of the next Federal Reserve rate hike next month.

“I think the bar is very high if you want to see the Fed doing anything less than 75bps,” Mizuho’s Gomez-Liechti added.

Money markets are pricing in an over 85% chance of a fourth consecutive 75 basis-point rate hike at the November meeting, according to Refinitiv data.

European Central Bank (ECB) officials have affirmed their commitment to take inflation back down to target, even in the face of a slowing economy.

France’s Francois Villeroy de Galhau said the central bank is engaged in bringing down inflation to 2% in two to three years from now, while Germany’s Joachim Nagel said on Friday that the next policy meetings must send out “clear signals” on reacting on inflation.

In Britain, the Bank of England said it was ready to increase the size of its daily purchases of government bonds to ensure sufficient capacity ahead of the end of its emergency programme to calm recent turmoil in the gilt market which is due to end on Friday.

Britain’s 10-year gilt yield was up 1.5 bps to 4.25%.

(Reporting by Samuel Indyk, editing by Ed Osmond)

Philippines makes cellphone SIM registration compulsory to fight scams, fraud

MANILA, Oct 10 (Reuters) – Philippines President Ferdinand Marcos Jr on Monday signed into law a measure making cellphone SIM registration compulsory, in a key step towards fighting text scams, bank fraud and misinformation.

The law will require users to furnish full names and identity documents before buying a SIM card, with the aim of preventing criminals from concealing their identities.

“We will finally achieve what has long been overdue, an effective means of regulating the issuance of SIM cards to curb the spread of spam text messages and scams,” Marcos said in a speech.

The Philippines has one of Asia’s highest smartphone penetration rates, at 61% of its population of 110 million. People have relied heavily on mobile devices for shopping, food delivery orders and banking during the pandemic.

Marcos’ predecessor, Rodrigo Duterte, vetoed the legislation because of a now-deleted provision requiring social media users to register their identities and phone numbers.

Under the new law, existing pre-paid users are compelled to register.

The country’s telecoms providers, which have blocked more than 1 billion spam and suspicious text messages this year, welcomed the new measure.

PLDT (TEL) said preparations are underway to comply with the new registration requirements, while Globe Telecom and DITO Telecommunity called for a wider rollout of the national identification system to help verify users.

Thousands of Filipinos have lost small amounts of money to phishing via short messaging services this year, but only a few have filed formal complaints, the information and communications ministry said.

(Reporting by Neil Jerome Morales; Editing by Kanupriya Kapoor)

Britain’s BoE doubles potential bond buy-backs as emergency plan nears end

LONDON, Oct 10 (Reuters) – The Bank of England sought to ease concerns about this week’s expiry of its program designed to calm turmoil in the government bond market, announcing new safety-net measures including a doubling of the maximum size of its debt buy-backs.

Finance minister Kwasi Kwarteng last month sparked a bond rout with plans for unfunded tax cuts, prompting the BoE to say on Sept. 28 it would buy up to 5 billion pounds (USD 5.53 billion) a day of gilts of at least 20 years duration until Oct. 14.

So far, the BoE has bought far less than the minimum daily limit, but on Monday it said it was taking further steps to ensure the scheme concludes smoothly.

“In the final week of operations, the Bank is announcing additional measures to support an orderly end of its purchase scheme,” the British central bank said in a statement.

Although the maximum auction size was raised to 10 billion pounds in Monday’s operation the BoE bought only 853 million pounds’ worth of debt.

That left its total of bonds acquired since the launch of the emergency program at less than 6 billion pounds, compared with the 50 billion pound maximum it could have bought.

The BoE said in its statement earlier on Monday that it was prepared to deploy unused purchasing capacity in the remaining auctions this week.

The BoE also said it would launch a temporary expanded collateral repo facility to help banks ease liquidity pressures facing client funds caught up in the turmoil, which threatened pension funds.

The liquidity insurance operations would run beyond the end of this week and would accept a wider range of collateral than usual, including corporate bonds.

In a third move, the BoE said it was prepared to support further easing of liquidity pressures facing liability-driven investment funds through its regular Indexed Long Term Repo operations each Tuesday.

The sharp sell-off in British government bonds after Kwarteng’s “mini-budget” sparked a scramble for cash by Britain’s pension funds which had to post emergency collateral in LDIs.

In a move aimed at calming investors’ nerves, Kwarteng said on Monday he would bring forward his medium-term fiscal plan, including an explanation of how the tax cuts will be paid for, to Oct. 31 from Nov. 23, with independent budget forecasts to be published the same day.

The earlier date will allow the BoE to understand the government’s tax and spending plans before it announces its next interest rate decision on Nov. 3.

“You have lots of risk events coming,” Pooja Kumra, senior European rates strategist at TD Securities, said. “Markets will be looking at each and every auction.”

Yields on British 20- and 30-year gilts jumped by nearly 30 basis points on Monday, approaching their levels during the worst of the market rout triggered by Kwarteng’s mini-budget and adding to a recent run of daily increases.

Antoine Bouvet, a strategist at ING, said low take up of the BoE’s facility so far suggested that risk reduction by pension funds had been limited to date, and the central bank wanted to show it could deploy more support.

“The closer we get to Friday the more gilts will sell off,” Bouvet said. “The bigger picture here is that the functioning of the gilt market is still impaired.”

(USD 1 = 0.9035 pounds)

(Additional reporting by Tommy Wilkes, Harry Robertson, Muvija M and Sachin Ravikumar; Writing by William Schomberg; Editing by Catherine Evans)

Philippines partially awards 91-day, 182-day T-bill offers

MANILA, Oct 10 (Reuters) – Following are the results of the Philippine Bureau of the Treasury’s (BTr) auction of T-bills on Monday:

* BTr awards 1.27 billion pesos ($21.53 million) of 91-day T-bills vs 5 billion pesos offer at 3.819% avg yield

* BTr awards 2.695 billion pesos of 182-day T-bills vs 5 billion pesos offer at 4.415% avg yield

* BTr rejects all bids for 364-day T-bills

* Details are on the BTr’s website www.treasury.gov.ph

($1 = 58.99 Philippine pesos)

(Reporting by Enrico Dela Cruz; Editing by Ed Davies)

Oil falls as investors take profit amid China demand concerns

SINGAPORE, Oct 10 (Reuters) – Oil prices fell on Monday, snapping five days of gains, as investors took profits after a report on slowing economic activity in China, the world’s biggest crude importer, re-ignited concerns about falling global fuel demand.

Brent crude futures for December settlement fell by as much as 1.1%, and was last down 39 cents, or 0.4%, at USD 97.53 a barrel by 0645 GMT.

West Texas Intermediate crude for November delivery declined by as much as 1.1% and was last at USD 92.27 a barrel, down 37 cents, or 0.4%.

Services activity in China during September contracted for the first time in four months as COVID-19 restrictions hit demand and business confidence, data showed on Saturday.

The slowdown in the economy of China, the world’s second-largest oil consumer after the US, adds to growing concerns about a possible global recession triggered by numerous central banks raising interest rates to combat high inflation rates.

“Oil … is getting hit with the triple whammy of China’s economic weakness, U.S. monetary policy tightening and Biden administration SPR intervention,” Stephen Innes, managing director at SPI Asset Management, said in a note.

Innes was referring to the possibility of additional releases from the US Strategic Petroleum Reserve next month in response to the decision last week by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as OPEC+, to lower their output target by 2 million barrels per day.

Brent and WTI posted their biggest weekly percentage gains since March after the reduction was announced.

The OPEC+ cuts, which come ahead of a European Union embargo on Russian oil, will squeeze supply in an already tight market. EU sanctions on Russian crude and oil products will take effect in December and February, respectively.

“The cut is clearly bullish,” ING analysts said in a note.

“However, there is obviously still plenty of other uncertainty in the market, including how Russian oil supply evolves due to the EU oil ban and G-7 price cap, as well as the demand outlook given the deteriorating macro picture.”

Analysts at banks and brokerages have raised their crude price forecasts and expect Brent to rise above $100 a barrel in the coming months.

Despite the promised cuts in output, Saudi Arabian state oil company Saudi Aramco has told at least five North Asian customers they will receive full contract volumes of crude oil in November, according to sources with knowledge of the matter.

That would indicate little change in the physical supply of oil at least to Asian buyers of crude from Saudi Arabia, who as OPEC’s biggest producer will assume a large portion of the announced reductions.

Other signs of slowing demand emerged from India, the world’s third-largest oil user. Government data on Friday showed that fuel demand in September fell to the lowest since November and was down 3.6% from August.

(Reporting by Florence Tan and Emily Chow; Editing by Jacqueline Wong and Christian Schmollinger)

Oil falls by nearly 2% as recession fears outweigh tight supply prospects

NEW YORK, Oct 10 (Reuters) – Oil prices sank by nearly 2% on Monday, after five straight sessions of gains, as investors worried that economic storm clouds could foreshadow a global recession and erode fuel demand.

Brent crude futures settled at USD 96.19 a barrel, down USD 1.73, or 1.8%. West Texas Intermediate crude settled at USD 91.13 a barrel, losing USD 1.51, 1.6%. Both benchmarks had risen over the previous week largely on expectations of tightening global supply.

Oil prices fell amid comments from US Federal Reserve officials about rising interest rates and their effect on the economy.

Fed Vice Chair Lael Brainard said the economy is starting to feel more restrictive monetary policy, but the full brunt of the central bank’s interest rate hikes will not be apparent for months.

Brainard’s comments followed remarks by Chicago Fed President Charles Evans that there was a strong consensus at the Fed to raise the target policy rate to around 4.5% by March and hold it there.

“There’s more of the doom and gloom from those folks and what they’re going to do to the economy, because they’re not so convinced they have inflation under control, and that’s the macro play that’s weighing on oil,” said John Kilduff, partner at Again Capital LLC in New York.

Oil prices also struggled under a strengthening US dollar, which rose for a fourth session. A stronger dollar makes crude more expensive for non-American buyers.

The prospect of tightening OPEC+ oil supplies limited declines in prices. The Organization of the Petroleum Exporting Countries and allies including Russia, together known as OPEC+, decided last week to lower their output target by 2 million barrels per day.

But signs that the group’s de facto leader, Saudi Arabia, will continue to serve Asian customers at full levels lowered expectations of the cuts’ impact.

Saudi Aramco has told at least seven customers in Asia they will receive full contract volumes of crude oil in November ahead of the peak winter season, several sources with knowledge of the matter said.

“OPEC+’s decision… will have a muted impact on the oil supply market as actual output cuts will be smaller,” Fitch Ratings said, noting that collectively the group was already producing less than its previous quotas.

Brent and WTI posted their biggest weekly percentage gains since March after the reduction was announced.

However, the cut spurred a flurry of activity in the options market – but with more US bettors opting for a bearish stance, data from CME Group showed.

Concerns over still relatively robust demand as the pandemic has eased meeting potentially scarce supply have been deepened as the European Union late last week endorsed a G7 plan to impose a price cap on Russian oil exports.

The complicated new sanctions package could end up shutting in considerable supplies of Russia crude, analysts have warned.

Meanwhile, services activity in China during September contracted for the first time in four months as COVID-19 restrictions hit demand and business confidence, data showed on Saturday.

(Additional reporting by Noah Browning, Florence Tan and Emily Chow; Editing by Mark Porter and Marguerita Choy)

Gold hits one-week low as solid US data fans rate-hike fears

Oct 10 (Reuters) – Gold prices fell to a one-week low on Monday, as solid US jobs data boosted expectations that the Federal Reserve will continue to deliver oversized interest rate hikes.

Spot gold was down 0.5% at USD 1,686.55 per ounce, as of 0623 GMT, after hitting its lowest since Oct. 3. US gold futures were down 0.8% at USD 1,695.70.

The dollar index was steady after touching a one-week high on Friday. A stronger greenback makes gold costlier for buyers holding other currencies.

“Gold prices are taking their cue from the build-up in rate-hike expectations from last week, brought on by the hotter-than-expected US job report,” IG market strategist Yeap Jun Rong said, adding that gold prices seemed to remain locked in a downward trend for now.

Data showed on Friday US job growth slowed moderately in September while the unemployment rate dropped, signalling a resilient economy and dousing hopes of a Fed pivot anytime soon.

Investors will now focus on the US inflation data due later this week. Headline consumer price inflation is seen slowing a touch to an annual 8.1%, but the core measure is forecast to accelerate to 6.5% from 6.3%.

While gold is often seen as a hedge against inflation, rising US interest rates increase the opportunity cost of holding the non-yielding gold.

Gold prices have declined more than USD 350 since surging past the USD 2,000-mark in March, amid aggressive US monetary policy tightening.

Spot gold is expected to fall into a range of USD 1,660 to USD 1,674 per ounce, as it has more or less broken a support at USD 1,689, according to Reuters technical analyst Wang Tao.

Holdings of SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, fell by 2.03 tonnes on Friday, marking its biggest outflow since late September.

Spot silver shed 1.9% to USD 19.73 per ounce after hitting a one-week low. Platinum fell 0.6% to USD 906.90, while palladium inched 0.1% lower to USD 2,179.49.

(Reporting by Eileen Soreng in Bengaluru; Editing by Sherry Jacob-Phillips and Subhranshu Sahu)

Philippines energy chief: 2023 power supply conditions look ‘difficult’

MANILA, Oct 10 (Reuters) – The Philippines’ energy minister said on Monday the country’s power supply situation next year is likely to be difficult, with some hydro plants expected to be unable to deliver electricity.

Energy Secretary Raphael Lotilla, in a forum organized by the Economic Journalists Association of the Philippines, also said he was encouraging the increased use of renewable sources of energy, which could help ease the impact of high fuel prices.

The Southeast Asian country has sufficient power supply for the rest of the year, but Lotilla did not rule out “yellow alerts” – which are issued by his department whenever reserves are thin and thus could potentially cause outages.

The Philippines remains dependent on fossil fuels for electricity generation, but Lotilla has sought to ramp up support for renewables.

“In 2023 the situation is a bit difficult especially in the summer months. The scenario…shows several yellow alerts and possible red alerts in 2023,” he said. Red alerts are issued when supply is insufficient to meet demand.

(Reporting by Enrico Dela Cruz, Neil Jerome Morales and Karen Lema; Editing by Kim Coghill and Ed Davies)

2024 Mid-Year Economic Briefing: Navigating the Easing Cycle

Investing with Love: A Mother’s Guide to Putting Money to Work

Investor Series: An Introduction to Estate Planning

Quarterly Economic Growth Release: 5.4% Q12025

Policy rate views: Uncertainty stalls cuts