Daily Notes INDEX

DAILY MARKET STATS

VALUE PTS PCT YTD

Tuesday, July 07, 2020
PSEI 6,328.41 -44.25 -0.69% -19.02%
Reference: Claire T. Alviar ALL 3,702.17 -15.76 -0.42% -20.38%

Metropolitan Bank & Trust Com. [pse:MBT] FIN 1,239.71 -27.85 -2.20% -33.48%

IND 7,929.99 -20.74 -0.26% -17.70%

BUY TP: 49.90 HDG 6,532.53 -33.46 -0.51% -13.96%

PRO 3,140.75 -28.93 -0.91% -24.40%

SVC 1,451.07 18.99 1.33% -5.23%

STOCK SNIPPETS
M&O 5,458.91 152.07 2.87% -32.54%
Last Traded Price (PHP) 37.90
ASIAN MARKETS
P/E Ratio (x) 6.07 • Attractive valuations (AS 03:00 PM)

P/B Ratio (x) 0.55 • Prudent balance sheet INDEX VALUE PTS PCT YTD

Support 36.52 • Increasing footprint to digital space Nikkei 225 22,714.44 407.96 1.83% -3.98%

Reference: Piper Chaucer E. Tan Hang Seng 26,253.12 880.00 3.47% -6.87%
Resistance 40.00
Shanghai 3,328.68 175.87 5.58% 9.13%
MTD Performance (%) 2.43
KOSPI 2,187.93 35.52 1.65% -0.44%
YTD Performance (%) -42.84
HCM 859.97 12.36 1.46% -10.51%

SET 1,372.27 -1.86% -0.14% -13.14%

STI 2,687.80 34.86 1.31% -16.60%

OUR VIEW KLCI 1,573.46 20.81 1.34% -0.96%

JCI 4,991.82 18.03 0.36% -20.76%

INTERNALS

VOL 1,065,953,666 ADV 102

VAL 6,141,081,321.64 DEC 103

BLOCK 344,706,800.12 UNCH 43

Buy on dips as we expect a rebound after the market ended lower yesterday, while investors await
June inflation rate data today. The benign inflation outlook could spur optimism, look for consumer
stocks since this sector will benefit the most on low and steady rise of goods’ prices. We forecast
June inflation rate at 2.3%, slightly higher than 2.1% in May.

TOP 5 GAINERS TOP 5 LOSERS

BLOOM 4.06% FGEN –4.28%

MEG 2.52% SECB –3.38%

MER 1.73% MBT –2.70%

Source: TradingView
TEL 1.71% BDO –2.45%

MARKET WRAP GLO 1.42% SMPH –2.10%

OTHER MARKET SNAPSHOTS

PSEi closed lower reacting on the spike of additional coronavirus cases over the weekend, which Brent Crude 43.45 1.52%
recorded 2,434 cases -the highest in a single day. This brought negative sentiment in the market as
WTI Crude 40.83 0.44%
mounting cases could force the government to impose stricter guidelines which is detrimental to
economy. But we believe that, the Covid-19 cases should be contained first before the economy Gold 1,785.25 -0.17%

gets back to normal. Silver 18.36 0.25%

Copper 2.75 1.25%

The latest forecast of Moody's Investors Service that the economy is expected to shrink by 4.5%
US$:Php 49.37 -0.39%
this year, weighed on the sentiment as well. It is deeper than the 2-3.4% projection of the govern-
ment, which could mean that Moody's expects more damage to the businesses/economy amid the US 10 Yr Yield 0.68% -1.00%

pandemic. Last minute bargain hunting last Friday also triggered profit taking in the session.

Philstocks Research 2020 1 |Page

LOCAL NEWS Philstocks Research
JUSTINO B. CALAYCAY, JR
DOF plans to ban the online sales of cigarettes and alcoholic beverages. According to the AVP-Head, Research & Engagement
Finance Secretary Carlos Dominguez , the Department of Finance may ban selling of cigarettes and +63 (2) 8588-1962
liquors online as it is hard to ensure that they are not being sold to minors. In Lazada, one of the
largest online shopping platform, some sellers are offering cigarettes packs at almost 50% off, the JAPHET LOUIS O. TANTIANGCO
department will get in touch with the platform to verify if the products are fake or counterfeit. The Sr. Research Analyst
government recorded a 39% decline of sin tax collections in January-May period. +63 (2) 8588-1927

If this happened, liquor and cigarette manufacturers [SMC, GSMI, LTG, EMP] would have lower PIPER CHAUCER E. TAN
earnings given the lesser distribution channel amid the current online selling trend. We think that the Engagement Officer/Research Associate
department should impose stricter rules or verification process just to avoid selling these products to +63 (2) 8588-1928
minors, since omitting this channel may weigh further on manufacturers amid weaker demand due to
CLAIRE T. ALVIAR
liquor ban.
Research Associate
+63 (2) 8588-1925
GLOBAL NEWS
Ground Floor, East Tower
Two states in the US hit a record high of daily Covid-19 cases on Fourth of July. Florida and PSE Center, Tektite Towers
Texas have reported a surge on daily coronavirus cases, with 11,445 and 8,258 new cases, Ortigas Center, Pasig City
respectively. Despite the record-high cases, Gov. Ron DeSantis still insists not to close businesses PHILIPPINES
and refuses to order a statewide mask mandate.
DISCLAIMER
This will be detrimental to the health of citizens, as well as to the economy. The economy will not be The opinion, views and recommendations
back to normal as long as the virus lingers. People will be afraid to do more activities to support the contained in this material were prepared by
economy, and businesses may cut operations due to weaker demand. OFWs in the US could lose the Philstocks Research Team, individually
jobs, which would hit remittance inflow in the country. and separately, based on their specific
sector assignments, contextual framework,
personal judgments, biases and prejudices,
time horizons, methods and other factors.
The reader is enjoined to take this into
COMPANY NEWS account when perusing and considering the
contents of the report as a basis for their
stock investment or trading decisions.
BUY Metropolitan Bank & Trust Company [pse:MBT] Furthermore, projection made and presented
in this report may change or be updated in
MBT plans to issue a Reg S only 5.5-year USD-denominated Senior Unsecured Notes. The proceeds between the periods of release. Ergo, the
of which will be used to refinance existing indebtedness. validity of the projections and/or estimates
mentioned are good as of the date indicated
“It has been on the trend among banks right now to tap the fixed income market for fund raising, what I and may be changed without immediate
see here is that companies are taking advantage of cheap cost of money amid series of rate cuts and notification.
policy easing by the Central Bank and this is a way for banks to combat the uncertainties brought by This report is primarily intended for
COVID-19 and also this is a way for companies to have an ample cash supply where the expectation information purposes only and should not be
credit will rise once COVID-19 pandemic diminishes over time.” -Piper Chaucer E. Tan considered as an exclusive basis for making
investment decision. The recommendations
Support is at P36.52 while resistance is peg at P40.00. Watch for the buying signal of EMAs, if the 20- contained in this report is not tailored-fit any
day crosses above the 50-day EMA. particular investor type, situation, or
objective and must not be taken as such.
Target Price: P49.90 Determining the suitability of an investment
remains within the province of the investor.
Our estimates are based on information we
believe to be reliable. Nevertheless, nothing
in this report shall be construed as an offer
of a guarantee of a return of any kind and at
any time.

Rating Definitions:
BUY - More than 15% upside base on the target price
in the next 9-12 months

HOLD - 15% or less upside or downside in the next

9-12 months

SELL - More than 15% downside base on the target

price in the next 9-12 months
TRADE - A potential 10% and above short-term upside
Source: TradingView base on entry price and selling price.

Philstocks Research 2020 2 |Page