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April 27 (Reuters) – Aboitiz Equity Ventures Inc AEV.PS:
CONSOLIDATED NET INCOME OF 3.9 BILLION PESOS FOR 1Q22, A 54% DECREASE
WITHOUT ONE-OFF GAINS, CORE NET INCOME FOR 1Q22 WAS 3.2 BILLION PESOS, DOWN 64%
Source text for Eikon: ID:nPSX4Rhn9m
Further company coverage: AEV.PS
FRANKFURT, April 26 (Reuters) – The European Central Bank should raise interest rates soon and has room for up to three hikes this year, ECB policymaker Martins Kazaks told Reuters, joining a chorus of policymakers calling for a swift exit from stimulus.
The ECB has been rolling back support at a glacial pace for months but a surge in inflation to nearly four times the ECB’s 2% target is intensifying calls to finally end a nearly decade-long foray into ultra-easy monetary policy.
“A rate rise in July is possible and reasonable,” Kazaks, who is Latvia’s central bank governor, said in an interview. “Markets are pricing two or three 25 basis point steps by the end of the year. I have no reason to object to this, it’s quite a reasonable view to take.”
“Whether it happens in July or September is not dramatically different, but I think July would be a better option,” he said.
Kazaks said that as part of normalisation, the ECB should eventually raise interest rates to the neutral rate, at which the central bank is neither stimulating nor holding back growth.
Various estimates put this rate at 1% to 1.5%, Kazaks said, well above the current minus 0.5% deposit rate and its main refinancing rate, stuck at zero.
Kazaks added that initially the ECB should raise rates by 25 basis points but this increment is not carved in stone. He also said there was no particular reason the central bank should stop once it gets back to zero, even if that is a psychological threshold.
The ECB has so far guided markets for a rate rise only “some time” after its bond purchase scheme, commonly known as quantitative easing, ends in the third quarter.
But this formulation is too vague and a large chunk of the rate-setting Governing Council is pushing for an end to the bond buys at the start of the third quarter, so rates could possibly rise in July.
“Ending the Asset Purchases Programme in early July is appropriate,” Kazaks said. “The APP has fulfilled its purpose so it’s not necessary anymore.”
Part of the urgency is that inflation expectations have started to move above the ECB’s target, a warning sign that investors and businesses are starting to doubt the ECB’s resolve and ability to hit its target further out.
But the central bank has been cautious as inflation undershot its target for nearly a decade and dealing with excessive price growth is a relatively new phenomenon.
“I don’t think (de-anchoring) has happened yet, but the risks are there. That’s why I think a rate hike relatively soon is needed,” he said.
The ECB will next meet on June 9 where policymakers are expected to put a firm end date on bond buys and provide clearer guidance on interest rates.
(Reporting by Balazs Koranyi; Editing by Jacqueline Wong)
HONG KONG, April 26 (Reuters) – The dollar held near a two-year peak on Tuesday as concerns about the economic impact of China’s COVID-19 lockdowns held up the greenback’s safe-haven appeal and aggressive U.S. interest rate hike expectations kept bond yields elevated.
The dollar index, which measures the greenback against six main peers, was 0.13% lower at 101.59 after hitting a two-year peak of 101.86 overnight.
It has gained 3.3% so far this month, which would be its largest month of gains since November 2015.
“Further (dollar index) upside remains a good bet. China growth risks are rising as authorities pursue an aggressive COVID campaign, conditions around Ukraine remain volatile and ‘Fed-speak’ remains as hawkish as ever,” said analysts at Westpac in a note.
China’s financial hub of Shanghai has now been under strict lockdown to fight COVID for around a month, while Beijing overnight ramped up plans for mass-testing of 20 million people and fuelled worries about a looming lockdown.
Hawkish comments by various central bank policymakers last week also raised the prospect of aggressive interest rate hikes. The most significant of these came from the U.S. Federal Reserve, which markets expect to raise rates by a half point at each of its next two meetings.
China’s offshore yuan was slightly higher however, at 6.5572 per dollar after the People’s Bank of China said late on Monday it would cut the amount of foreign exchange banks must hold as reserves.
That helped the currency recover from a year low of 6.609 per dollar on Monday, hurt by fears about China’s economic growth.
Equity markets and U.S. bond yields also edged higher on Tuesday amid an improvement in overall risk sentiment.
The euro EUR=EBS was at USD 1.0727, up 0.14% and edging off a two-year low of USD 1.0697 hit on Monday, when market nerves offset optimism from the re-election of French President Emmanuel Macron.
The pound GBP=D3 was at USD 1.2744, up 1.8%, having hit its lowest since September 2020 overnight. U.S. futures market data shows funds have amassed their biggest wager against the pound since October 2019, a bet now worth close to USD 5 billion.
The Australian dollar AUD=D3 rebounded 0.6% from its two-month low overnight, which it hit after China lockdowns weighed on commodity prices.
The dollar was little changed against yen JPY=, at 128.16. The Japanese currency has managed a very slight recovery this week from last week’s 20-year low of 129.40.
Bitcoin was a little firmer at USD 40,600, and ether was at USD 3,000.
Researchers at crypto liquidity provider B2C2 said crypto market trading was currently correlated closely with equity markets, in the absence of any strong crypto-related themes.
(Reporting by Alun John; Editing by Kenneth Maxwell and Sam Holmes)
TOKYO, April 26 (Reuters) – Japanese shares ended higher on Tuesday, tracking Wall Street gains overnight, but concerns over the impact of China’s COVID-19 lockdown on domestic companies capped their rise.
The Nikkei share average gained 0.41% to close at 26,700.11. The broader Topix rose 0.11% to 1,878.51, after briefly entering negative territory earlier in the session.
Shanghai’s COVID-19 lockdown misery dragged into a fourth week, while orders for mass testing in Beijing’s biggest district sparked fears that the Chinese capital could be destined for a similar fate.
“Investors were cautious about the impact of possible China’s economic slowdown on Japanese companies, as now there is a possibility that Beijing could be locked down,” said Tomoichiro Kubota, senior market analyst at Matsui Securities.
“Today’s market rose thanks to the gains on Wall Street and falling U.S. Treasury yields.”
Technology investor SoftBank Group provided the biggest boost to the Nikkei, rising 4.13%, followed by medical services platform M3, which jumped 5.04%. Chip-testing equipment maker Advantest rose 2.28%.
Fujitsu rose 2.17% after a report said the computer maker was weighing a sale of it scanning business to office equipment maker Ricoh, which fell 1.08%.
Canon Marketing Japan jumped 7.00% after the sales arm of camera maker Canon raised its profit outlook.
Sumitomo Metal Mining tumbled 6.83%, and was the biggest loser on the Nikkei, after the miner and smelter said it would discontinue a long-running feasibility study on a nickel processing plant project in Pomalaa, Indonesia.
The volume of shares traded on the Tokyo Stock Exchange’s main board was 1.08 billion, compared to the past 30-day average of 1.22 billion.
(Reporting by Junko Fujita; Editing by Vinay Dwivedi)
HONG KONG, April 26 (Reuters) – The dollar held near a two-year peak on Tuesday as concerns about the economic impact of China’s COVID-19 lockdowns held up the greenback’s safe-haven appeal and aggressive U.S. interest rate hike expectations kept bond yields elevated.
The dollar index, which measures the greenback against six main peers, was 0.13% lower at 101.59 after hitting a two-year peak of 101.86 overnight.
It has gained 3.3% so far this month, which would be its largest month of gains since November 2015.
“Further (dollar index) upside remains a good bet. China growth risks are rising as authorities pursue an aggressive COVID campaign, conditions around Ukraine remain volatile and ‘Fed-speak’ remains as hawkish as ever,” said analysts at Westpac in a note.
China’s financial hub of Shanghai has now been under strict lockdown to fight COVID for around a month, while Beijing overnight ramped up plans for mass-testing of 20 million people and fuelled worries about a looming lockdown.
Hawkish comments by various central bank policymakers last week also raised the prospect of aggressive interest rate hikes. The most significant of these came from the U.S. Federal Reserve, which markets expect to raise rates by a half point at each of its next two meetings.
China’s offshore yuan was slightly higher however, at 6.5572 per dollar after the People’s Bank of China said late on Monday it would cut the amount of foreign exchange banks must hold as reserves.
That helped the currency recover from a year low of 6.609 per dollar on Monday, hurt by fears about China’s economic growth.
Equity markets and U.S. bond yields also edged higher on Tuesday amid an improvement in overall risk sentiment.
The euro was at USD 1.0727, up 0.14% and edging off a two-year low of USD 1.0697 hit on Monday, when market nerves offset optimism from the re-election of French President Emmanuel Macron.
The pound was at USD 1.2744, up 1.8%, having hit its lowest since September 2020 overnight. U.S. futures market data shows funds have amassed their biggest wager against the pound since October 2019, a bet now worth close to USD 5 billion.
The Australian dollar rebounded 0.6% from its two-month low overnight, which it hit after China lockdowns weighed on commodity prices.
The dollar was little changed against yen, at 128.16. The Japanese currency has managed a very slight recovery this week from last week’s 20-year low of 129.40.
Bitcoin was a little firmer at USD 40,600, and ether was at USD 3,000.
Researchers at crypto liquidity provider B2C2 said crypto market trading was currently correlated closely with equity markets, in the absence of any strong crypto-related themes.
(Reporting by Alun John; Editing by Kenneth Maxwell and Sam Holmes)
MANILA, April 26 (Reuters) – Philippines presidential frontrunner Ferdinand Marcos Jr heaped praise on the country’s ousted former first family in an interview on Tuesday, calling his father and late dictator a “political genius” and mother Imelda, the Marcos dynasty’s “supreme politician”.
Marcos Jr is the clear favourite for the May 9 election, where victory would cap off a three-decade political fightback for a family driven from power in a 1986 uprising against its notorious 20-year rule.
The 64-year-old former senator and congressman told CNN Philippines he would not let his commanding lead in opinion polls distract him from work needed to be done to ensure victory.
“I am not confident that I’m going to be president yet, because I do not allow myself to be confident,” said Marcos, who was 32 points ahead of nearest rival, incumbent Vice President Leni Robredo, in the most recent survey. nL3N2W40XU
“It doesn’t matter to me what numbers you show me, we’re not there yet. So we don’t stop, we will keep going.”
Despite being driven into exile in the “people power” revolution, the Marcos family remains one of the wealthiest and most influential in Philippine politics.
His campaign has been helped by what political analysts say has been a decades-long public relations effort to alter perception of the Marcoses, who were accused of living lavishly at the helm of one of Asia’s most notorious kleptocracies.
The family’s rivals say the presidential run is an attempt to rewrite history, and change a narrative of corruption and authoritarianism.
PRIVILEGED LIFE
Marcos in the interview acknowledged his privileged life but said his parents reminded him and his siblings that “everything we have, all the advantages that we have gained, any successes that we have achieved, and any comfort or privilege that we enjoy comes from the people. And that is why you have to serve.”
His priorities if elected, he said, were “prices and jobs”.
He also said his father and namesake, whom he has called his “idol”, would not object if he called his mother the “supreme politician in the family”.
“My father is the statesman, he is the political genius, he is all that,” Marcos said.
Marcos senior ruled for two decades, almost half of it under martial law during which thousands of his opponents were beaten and tortured, and disappeared or were killed.
He and his wife, Imelda, 92, a four-time congresswoman, were accused of stealing billions from state coffers, allegations they refuted.
They remain parties to dozens of cases filed by the Presidential Commission on Good Government (PCGG), an agency created in 1986 to recover billions in missing Marcos wealth.
If elected, Marcos said he would strengthen the PCGG, so it can go after new targets.
“Instead of directing themselves against the Marcoses only, if I have a relative who is corrupt, then that person’s name will come out, not only us, everyone” he said.
(Reporting by Karen Lema and Neil Jerome Morales; Editing by Martin Petty)
((karen.lema@thomsonreuters.com; +632 841-8938;))
Recasts lead, adds background and details
MANILA, April 26 (Reuters) – The Philippines’ central bank is looking at raising benchmark interest rates two to three times to bring down inflation by next year, with the first hike to be considered in June, its governor said in an interview with Bloomberg TV on Tuesday.
“We have another meeting in June and maybe that is the time we will consider the increase in policy rate,” said Central Bank Governor Benjamin Diokno.
It would take two to three rate hikes, plus a normalisation of oil prices, to bring inflation down to an annual average of 3.6% in 2023, Diokno said.
Average inflation could breach the upper end of the 2%-4% target range in 2022 by reaching 4.3%, central bank data show.
The central bank’s next rate setting meeting is on May 19. It has kept key rates PHCBIR=ECI at a record low of 2% since November 2020 to help the economy weather the coronavirus pandemic.
(Reporting by Neil Jerome Morales; Editing by Kanupriya Kapoor)
((neiljerome.morales@thomsonreuters.com; +632 8841 8914;))
MANILA, April 26 (Reuters) – The Philippines’ central bank will consider a rate hike at its policy meeting in June to keep inflation under control, its governor said in an interview with Bloomberg TV on Tuesday.
“We have another meeting in June and that is the time we will consider the increase in policy rate,” said Central Bank Governor Benjamin Diokno.
The central bank’s next rate setting meeting is on May 19. It has kept key rates PHCBIR=ECI at a record low of 2% since November 2020.
(Reporting by Neil Jerome Morales; Editing by Kanupriya Kapoor)
((neiljerome.morales@thomsonreuters.com; +632 8841 8914;))
WASHINGTON/LONDON, April 25 (Reuters) – European stocks slid to a one-month low and commodity prices dropped on Monday on renewed concerns about rising interest rates and China’s sputtering economy, while Wall Street shares rose, reversing losses after Twitter agreed to be bought by billionaire Elon Musk.
Fears over China’s COVID-19 outbreaks spooked investors already worried that higher U.S. interest rates could dent economic growth. U.S. shares were lower throughout most of the session, extending last week’s sharp declines. The CBOE Volatility index known as Wall Street’s fear gauge, hit the lowest level since mid-March.
Twitter Inc (TWTR), shares rose on news that Elon Musk, the world’s richest person, clinked a deal to pay USD 44 billion cash for the social media platform populated by millions of users and global leaders.
After news of the deal, Wall Street reversed course on a late rally by growth stocks, and the Nasdaq ended sharply higher.
The Dow Jones Industrial Average rose 0.7% to end at 34,049.46 points, while the S&P 500 gained 0.57% to 4,296.12.
The Nasdaq Composite climbed 1.29% to 13,004.85.
“You can tell growth wanted to rally all day but the market was holding it down. The Twitter news came and that was just a green light to start buying some of the growth names. They have been oversold for a while,” said Dennis Dick, a trader at Bright Trading LLC.
Earlier, Europe’s STOXX 600 index dropped 1.8% to close at its lowest since mid-March. Commodity stocks slumped 6%, as global worries overshadowed relief from French presidential results on Sunday which saw Emmanuel Macron edge past far-right challenger Marine Le Pen.
MSCI’s benchmark for global equity markets fell 0.41% to 668.85. Emerging markets stocks fell 2.61%. Overnight, Asian markets had their worst daily decline in over a month on fears Beijing would go back into a COVID-19 lockdown.
“Stocks’ rebound from the first quarter correction has hit a wall of rising long-term interest rates,” Morgan Stanley’s Chief Investment Officer Lisa Shale said in a note.
“With the Fed talking about a faster and larger balance sheet reduction than anticipated, real yields are approaching zero from their deeply negative territory. With the nominal 10-year U.S. Treasury cracking 2.9%, the equity risk premium has plummeted.”
The euro slid 0.9%, near the session’s trough and its weakest level since the initial COVED panic of March 2020.
“The reality is there is more to the French election story than Macron’s win yesterday,” said Rabobank FX strategist Jane Foley.
France will hold parliamentary elections in June, and Macron also seems likely to maintain pressure for a Europe-wide ban on Russian oil and gas imports, which would cause near-term economic pain.
“We had German officials saying last week that if there was an immediate embargo of Russian energy then it would cause a recession in Germany. … that would drag the rest of Europe down and have knock-on effects for the rest of the world,” Foley said.
State television in China had reported that residents were ordered not to leave Beijing’s Chatoyant district after a few dozen COVID cases were detected over the weekend.
China’s yuan skidded to a one-year low while China stocks saw their biggest slump since the pandemic-led panic-selling of February 2020.
The dollar index rose 0.65% and climbed to a two-year high. It touched a peak of USD 1.0695 against the euro .
Investors wonder how fast and far the Federal Reserve will raise U.S. interest rates this year and whether that and other global strains will tip the world economy into recession.
This week will be packed with corporate earnings. Almost 180 S&P 500 index firms are to report. Among big U.S. tech companies, Microsoft and Google report on Tuesday, Facebook on Wednesday and Apple and Amazon on Thursday.
In Europe, 134 of the Stoxx 600 will put out results, including banks HSBC, UBS and Santander on Tuesday, Credit Suisse on Wednesday, Barclays on Thursday and NatWest and Spain’s BBVA on Friday.
“I wonder whether just meeting expectations will be enough, it just feels like maybe we’ll need a bit more,” said Rob Carnell, ING’s chief economist in Asia, referring to jitters about big tech following a dire report from Netflix last week.
FEAR FACTOR
Hong Kong’s Hang Seng fell 3.7% and the Shanghai composite index slid over 5% .
China’s central bank had fixed the mid-point of the yuan’s trading band at its lowest level in eight months, seen as an official nod for the currency’s slide, and the yuan was sold further, to a one-year low of 6.5092 per dollar .
The higher dollar pushed spot gold 1.7% lower by 4:53 p.m. EST (2053 GMT). U.S. gold futures settled nearly 2% lower at USD 1,896. Palladium prices were down nearly 10% on worries over Chinese demand.
In oil, Brent crude closed 4% lower at USD 102.32 a barrel and U.S. crude settled down 3.5% at USD 98.54, its first close below USD 100 since April 11.
Euro zone bond yields fell.
Money markets are pricing in a 1 percentage point increase in U.S. interest rates at the Fed’s next two meetings and at least 2.5 points for the year, which would be one of the biggest annual increases ever.
This week will also see the release of U.S. growth data, European inflation figures and a Bank of Japan policy meeting, which will be watched for any hints of a response to a sharp fall in the yen, which has lost 10% in about two months.
(Additional reporting by Bansari Mayu Kamdar, Noel Randewich, Tom Westbrook; Editing by Bernadette Baum, Catherine Evans, Mark Heinrich, Marguerita Choy and David Gregorio)
April 26 – Oil prices opened slightly higher on Tuesday, after falling sharply the prior session on worries that continued COVID-19 lockdowns in China would eat into demand and as the U.S. dollar rose to a two-year high.
Brent crude futures were at USD 102.57, up 25 cents, or 0.2% and U.S. West Texas Intermediate CLc1 contracts climbed to USD 98.70, up 16 cents, or 0.2% at 0002 GMT.
Both contracts had settled down around 4% on Monday, with Brent down as much as USD 7 a barrel in the session and WTI dipping roughly USD 6 a barrel.
In China lockdowns to counter COVID in Shanghai have dragged into their fourth week. Meanwhile orders for mass testing, including in Beijing’s largest shopping district, have prompted fears of other Shanghai-style lockdowns.
“The hit from Chinese lockdowns is over a million barrels a day and the testing of 12 districts over the next five days will determine the next major move for crude prices,” wrote Edward Moya, a senior market analyst for OANDA in a note.
The U.S. dollar also hit a two-year high on Monday, making oil more expensive for other currency holders.
“Supply fears are not the primary focus for energy traders, and now you have a surging dollar that is adding extra pressure across all commodities,” OANDA’s Moya said.
(Reporting by Liz Hampton in Denver; Editing by Kenneth Maxwell)
