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May 12 (Reuters) – Citicore Energy REIT Corp CREIT.PS:
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CITICORE ENERGY REIT CORP – APPROVED DIVIDENDS OF 0.044 PESOS PER SHARE FOR FIRST QUARTER
Source text for Eikon: ID:nPSX8Wn3hL
Further company coverage: CREIT.PS
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BRIEF-Jollibee Foods Corp Posts QTRLY Revenues 42,856.9 Million Pesos
May 12 (Reuters) – Jollibee Foods Corp JFC.PS:
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QTRLY REVENUES 42,856.9 MILLION PESOS VERSUS 34,680.6 MILLION PESOS
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QTRLY NET INCOME ATTRIBUTABLE 2.26 BILLION PESOS VERSUS 49.2 MILLION PESOS
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GLOBAL SAME STORE SALES FOR FIRST QUARTER GREW BY 16.5%
Source text for Eikon: ID:nPSX31SggD
Further company coverage: JFC.PS
PRECIOUS-Gold gains as dollar, Treasury yields weaken after U.S. inflation data
May 12 (Reuters) – Gold gained on Thursday as the dollar and Treasury yields slipped after U.S. consumer price data suggested inflation might have peaked in April, allaying some concerns of more aggressive Fed rate hikes.
A weaker dollar makes gold attractive for overseas buyers, while lower Treasury yields reduce the opportunity cost of holding zero-yield bullion.
FUNDAMENTALS
* Spot gold XAU= was up 0.2% at $1,855.11 per ounce, as of 0103 GMT, having risen as much as 1.1% in the previous session. U.S. gold futures GCv1 rose 0.2% to $1,856.90.
* The dollar =USD fell, lifting demand for greenback-priced gold, after economic data showed inflation remained high but was unlikely to lead the U.S. central bank to shift to a more aggressive path of monetary policy. USD/
* The consumer price index (CPI) rose 0.3% last month, the smallest gain since August, the Labor Department said on Wednesday, versus the 1.2% month-to-month surge in the CPI in March, the largest advance since September 2005.nL2N2X315F
* Benchmark U.S. 10-year Treasury yields were down after the data failed to ease concerns that the Federal Reserve’s agenda to cool rising prices may induce a recession. US/
* The Fed raised its benchmark overnight interest rate by half a percentage point last week, the biggest hike in 22 years, as it moves to unwind ultra-easy pandemic-era monetary policy and attempts to combat soaring inflation.
* Spot silver XAG= was up 0.1% to $21.57 per ounce, while platinum XPT= dipped 0.2% to $990.64, and palladium XPD= fell 0.7% to $2,021.16.
DATA/EVENTS (GMT)
0600 UK GDP Est 3M/3M March
0600 UK GDP Estimate MM, YY March
0600 UK Manufacturing Output MM March
0600 UK GDP Prelim QQ, YY Q1
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by Vinay Dwivedi)
((BharatGovind.Gautam@thomsonreuters.com; +91-80-6182-3021/ 3590 (If within U.S. call 651-848-5832 );))
Australia shares slide as U.S. inflation data fuels slowdown woes
May 12 (Reuters) – Australian shares slipped on Thursday, in line with global markets, after U.S. data showed higher-than-expected core inflation, fuelling worries about aggressive rate hikes and the prospect of an economic slowdown.
The S&P/ASX 200 index .AXJO was down 0.8% at 7,008.30, as of 0043 GMT. The benchmark closed 0.2% higher on Wednesday.
U.S. inflation data did little to ease investor worries over the outlook for interest rates and the economy. The monthly consumer price index data suggested inflation may have peaked in April but is likely to stay strong enough. nL2N2X22AO
In Asia, Japan’s Nikkei .N225 slumped 1.32% and S&P 500 E-minis futures EScv1 edged up 0.31%.
In Australia, financial stocks .AXFJ slipped 0.5% to mark their sixth consecutive loss.
The country’s biggest bank Commonwealth Bank of Australia CBA.AX fell 0.7% despite beating an estimate for third-quarter cash earnings. nL3N2X33YY
The remaining three of the “Big Four” banks fell between 0.1% and 1%.
Technology stocks .AXIJ dived as much as 7.4% to their lowest in two years after tracking a sharp overnight fall in the tech-heavy Nasdaq index. They were the top percentage losers in the benchmark. .N
ASX-listed shares of Block Inc SQ2.AX and Xero Ltd XRO.AX fell 15.7% and 8%, respectively.
Domestic gold stocks .AXGD fell 1.1% even as bullion prices bounced back. GOL/
Healthcare stocks .AXHJ fell 1.8% with heavyweight CSL Ltd CSL.AX losing 2.2% after the company said regulatory process for completion of Vifor Pharma acquisition would get delayed beyond June.
Energy stocks .AXEJ rose 0.6% as crude prices advanced after Russia sanctioned some European gas companies, adding to uncertainty in global oil markets. O/R
Viva Energy VEA.AX rose 4.5% and was among the top gainers in the benchmark index after the oil refiner posted a 65% jump in operating earnings for the first four months of the year. nL3N2X34DM
Miners .AXMM edged up 0.1% on strong iron ore prices. IRONORE/
New Zealand’s benchmark S&P/NZX 50 index .NZ50 fell 0.5% to 11,180.71.
(Reporting by Himanshi Akhand in Bengaluru; Editing by Sherry Jacob-Phillips)
((Himanshi.Akhand@thomsonreuters.com))
For more information on DIARIES & DATA: U.S. earnings diary RESF/US Wall Street Week Ahead .N/O Global Economy Week Ahead DATA/ ................................................................ For latest top breaking news across all markets NEWS1
UPDATE 3-Chinese developer Sunac misses bond repayment, expects to miss more
Adds source and company comment, bond prices, details
By Scott Murdoch and Clare Jim
HONG KONG, May 12 (Reuters) – Developer Sunac China 1918.HK missed the deadline for coupon payments on a $742 million offshore bond and said on Thursday it doesn’t expect to make payments coming due on other bonds, adding to a wave of defaults in China’s debt-laden property sector.
A source close to the company, the nation’s third-largest property developer by sales, said Sunac is considering a restructuring of its offshore debt to extend payments. It is also talking to state-owned entities about strategic investments in the firm.
Sunac declined to comment.
The company said in a filing to the Hong Kong stock exchange that it has hired Houlihan Lokey as a financial advisor and Sidley Austin as a legal adviser to explore solutions to ease current liquidity constraints.
With $7.7 billion in dollar bonds, Sunac is the fourth-largest issuer among Chinese developers, according to data from Duration Finance.
China’s property sector has been hit by series of defaults on offshore debt obligations, highlighted by China Evergrande Group 3333.HK and Kaisa Group 1638.HK, as well as bond exchanges, with Zhongliang Holdings 2772.HK the latest firm to extend payments.
Sunac’s debt payment problem reflects a higher likelihood that some other major developers could miss their upcoming obligations or may need to do bond exchanges, analysts and developers said. nL2N2X30QW
The debt crisis has spilled over into the country’s vast property market, with new home sales and construction slumping as financing gets tougher and potential home buyers shy away, fearing some projects may be stalled.
“The group’s contracted sales have continued to decline significantly, while access to new financing has become increasingly difficult with more liquidity issues occurring among certain property developers,” Sunac said in the filing.
In a separate press statement, Sunac said its aggregated sales in March and April fell 65% from a year ago due to COVID-19 outbreaks in various cities, and its refinancing and asset disposal plans did not materialize after a series of rating downgrades earlier this year.
The firm confirmed it missed the Wednesday deadline for a $29.5 million interest payment on the October 2023 bond VG198108928= that was required to be repaid last month, and it does not expect it will pay three other coupons due last month totalling $75.3 million before the 30-day grace periods expire, or pay other senior notes when they become due.
Sunac said missing the October 2023 payment meant bondholders could seek the immediate repayment of the principal and interest but it had not received any “acceleration notices” from those holders.
It apologised to its creditors in the filing and asked them to give it the time “to overcome challenges” while it makes efforts to enhance credit profile, including accelerating sales, disposing of assets, seeking debt extension, and introducing strategic investors.
The October 2023 bond was traded at 21.156 cents on the dollar as of 0301 GMT, edging up from 19.107 on Wednesday, while another bond due June 2022 VG201295483= traded at 28.015.
Sunac’s Hong Kong-listed shares have been suspended since April 1 pending the release of its 2021 financial statements. Its unit Sunac Services 1516.HK fell over 7% on Thursday.
(Reporting by Scott Murdoch in Hong Kong; Editing by Christian Schmollinger and Richard Pullin)
BRIEF-Pilipinas Shell Petroleum Corp Says Qtrly Net Income of 3.5 Bln Pesos
May 12 (Reuters) – Pilipinas Shell Petroleum Corp SHLPH.PS:
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QTRLY GROSS REVENUE 59.98 BILLION PESOS VERSUS 40.43 BILLION PESOS
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DELIVERS 3.5 BLN PESOS NET INCOME IN Q1
Source text for Eikon: ID:nPSX3yWKnc
Further company coverage: SHLPH.PS
Chinese developer Sunac misses bond repayment
HONG KONG, May 12 (Reuters) – Sunac China 1918.HK did not make an interest payment on a $750 million offshore bond by the time a grace period expired, the company said in a statement on Thursday.
It had been due to pay $29.5 million in interest on the October 2023 bond that was required to be repaid last month.
(Reporting by Scott Murdoch; Editing by Tom Hogue)
UPDATE 3-Hong Kong c.bank props up currency, first intervention since Oct 2020
Adds details of second intervention
By Donny Kwok and Alun John
HONG KONG, May 12 (Reuters) – The Hong Kong Monetary Authority (HKMA) stepped into currency markets for the first time in 18 months, twice buying Hong Kong dollars to stop the local currency weakening and breaking its peg to the U.S. dollar.
The de facto central bank bought HK$1.586 billion ($202 million) from the market in U.S trading on Wednesday and a further HK$4.082 billion in Hong Kong trading on Thursday.
The Hong Kong dollar HKD=D3 is pegged to a tight band of between 7.75 and 7.85 versus the U.S. dollar. It has been softening as U.S. interest rates rise while a surfeit of cash in the local banking system keeps Hong Kong rates pinned down.
One-month U.S. dollar Libor USD1MFSR=X, a benchmark lending rate, is around 0.8% – its highest since April 2020 – while the Hong Kong equivalent, one-month Hibor HIHKD1MD=, is under 0.2% and barely above its COVID-19 pandemic lows.
HKMA’s Chief Executive Eddie Yue said last week that as it intervenes and funds flow out of Hong Kong’s system, local rates should rise, removing the incentive for market players to conduct “carry trades”, and hence keep the Hong Kong dollar trading within its band.
“All these are normal operations in accordance with the design of the Linked Exchange Rate System,” he said.
This arrangement was created in 1983 and has survived many crises over the years, including an attack from famed short-seller George Soros during the 1997-98 Asian financial crisis.
The HKMA last intervened in October 2020. That year it sold HK$383.5 billion worth to rein in the strengthening currency, according to HKMA data, while it last intervened at the weak end of the band in March 2019.
After both interventions, the aggregate balance aHKSETBAL – the key gauge of cash in the banking system – will decrease to HK$331.923 billion on May 16, an HKMA spokeswoman said on Thursday.
It dropped to around HK$50 billion in 2019 after the last series of HKMA interventions to stop the currency weakening.
In 2020, it surged to more than HK$450 billion as capital rushed into Hong Kong, drawn by higher interest rates locally than in the U.S. and a series of large initial public offerings.
(Reporting by Donny Kwok; Editing by Stephen Coates, Kenneth Maxwell and Bernadette Baum)
((donny.kwok@thomsonreuters.com; +852 3462 7745; Reuters Messaging: donny.kwok.reuters.com@reuters.net))
RPT-India’s cbank likely to raise inflation projection in June meeting, consider more rate hikes-source
Repeats story from late Wednesday with no changes to text
By Aftab Ahmed and Nupur Anand
NEW DELHI, May 11 (Reuters) – India’s central bank is likely to raise its inflation projection for the current fiscal year at its June monetary policy meeting and will consider more interest rate hikes, a source aware of the development said on Wednesday.
In its first rate move in two years and its first hike in nearly four, the Reserve Bank of India (RBI) raised the repo rate INREPO=ECI by 40 basis points (bps) to 4.40% following a emergency meeting earlier this month.
In April, RBI raised its inflation forecast for the current fiscal year to 5.7%, 120 bps above its forecast in February, while cutting its economic growth forecast to 7.2% for 2022/23 from 7.8%.
The RBI will “certainly” raise the forecast again in June, as it did not want to do it in the off-cycle emergency meeting in May, said the source, who did not want to be identified as the discussions are private.
The source did not detail how much the price forecast would be raised, but said that the RBI’s current view trails the International Monetary Fund’s inflation forecast of 6.1% for India.
The next meeting of the MPC is scheduled for June 6-8.
“The MPC did an off-cycle hike as it did not want to bunch off a big hike in just two meetings in June and August. They wanted to spread it (out),” the source said.
Inflation in March shot up to 7%, a 17-month high, on the back of rising food prices. It has now been above the upper limit of RBI’s 2%-6% tolerance band for three straight months and is likely to remain so in April.
The RBI cut the repo rate by a total of 115 bps in 2020 to cushion the impact of the COVID-19 pandemic and anti-virus measures. It is now looking to reverse those cuts at a faster pace than it wanted to earlier, the source said.
Before the crisis in Ukraine erupted, the RBI expected retail headline inflation to peak by March and then ease back towards 4% in the second quarter of 2022/23 that started on April 1. nL1N2UP0RV
‘KILLING DEMAND’
India’s economic recovery could be hurt by rising borrowing costs, as the central bank is likely to fully focus on fighting inflation.
“The RBI had said in the past that inflation was on account of supply concerns. The same narrative remains but now the supply side constrains have worsened. Now, RBI is forced to act,” the source said.
In the next 6-8 months, all central banks including RBI will be “killing whatever demand” there was in the economy in their fight to contain inflation, the source said.
“The risk of stagflation remains high and the world’s most powerful central banks do not have a weapon against it. Let’s wish that does not happen,” the source said.
The European Central Bank has already warned that Russia’s invasion of Ukraine could lead to a combination of low growth and high inflation, known as stagflation.
The official also said that the RBI will help the government to bring down bond yields using various instruments, though the degree of help would not be as much as that in the last two years.
On Monday, Reuters reported the government has asked the central bank to either buy back government bonds or conduct open market operations to cool yields that have hit their highest levels since 2019. nL2N2X11GS
The RBI has sold dollars to prop up the rupee, which fell to a record low on Monday and closed at 77.47 against the dollar. It intervened in the market in the last three days and will do so again if volatility persists.
The official said that the central bank was not targeting any particular levels but does not like “jerky” movements of over 0.50 Indian rupees against the dollar in one day.
(Reporting by Aftab Ahmed in New Delhi and Nupur Anand in Mumbai; Editing by Kim Coghill)
((Aftab.Ahmed@thomsonreuters.com; +91 99109 33884; Reuters Messaging: twitter: @aftabahmed00))
Investors cut valuations of Latam startups -Creditas founder
By Tatiana Bautzer
NEW YORK, May 11 (Reuters) – Investors have been reducing valuations of Latin American startups during the global stock market rout and in an environment of higher interest rates, said Sergio Furio, founder of unicorn fintech Creditas.
“Startups that raised cash at peak valuation, for example last July last year, will have to accept a reduction if they need more money this year”, said Furio. Following the public markets, multiples attributed to private companies fell. Shares of Latam’s largest fintech, digital bank Nubank NU.N, sank 60.6% this year.
So startups are trying to conserve cash, Furio added. Creditas’ latest funding was in January, a $260 million round in which the valuation reached $4.8 billion. The fintech will not raise capital this year, Furio said in an interview with Reuters before meeting with investors in New York.
The startup expects to moderate credit growth, as its consumers deal with higher inflation and lower disposable income. It also intends to present progress in the operation of Voltz, an electric motorbike maker in which Creditas invested 100 million reais.
The investment banking unit of Latin America’s largest bank, Itau BBA, is hosting its first conference in New York with Latin American CEOs since the start of the pandemic, with around 150 companies headquartered in Brazil, Mexico, Colombia and Argentina.
Emerging market investors have been more interested in Latin America since the Ukraine war, as the region is relatively insulated from the higher geopolitical risks. They also have become more demanding.
Alex Ibrahim, head of international markets at the New York Stock Exchange (NYSE), expects markets to reopen for new equity offerings from Latin America by September.
“Investors are more selective, demanding a clear path to profitability from startups”, Ibrahim said. Investors are more cautious about companies that burn cash. While the market is closed, the NYSE has been working to prepare candidates, including tech and industrial companies, to come to markets when there is a window.
(Reporting by Tatiana Bautzer; Editing by David Gregorio)
((tatiana.bautzer@tr.com; Tel: +55-11-5644-7756; Mob: +55-119-4210-4173; Reuters Messaging: tatiana.bautzer.thomsonreuters.com@reuters.net))