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00:00.0
Hello everyone, I'm Stanley Palisades. 9 a.m. here in Manila, 10 a.m. in Tokyo and 9 p.m. in New York.
00:16.1
The headlines, Asian markets trading higher early Tuesday, mirroring gains on Wall Street overnight.
00:22.4
Here at home, Philippine shares closed flat Monday, kicking off from 64.44.
00:27.0
Ayala-led Bank of the Philippine Islands delivers record earnings in the first quarter of 2024.
00:35.9
A Philippine Research Institute sees nuclear energy as the answer to the country's power wows.
00:43.1
We'll talk about this with nuclear energy advocate, Pangasinan Representative Marco Honko.
00:48.2
We'll also put the spotlight on environmental issues in the country as we speak with Plastic Bank CEO David Katz later on the program.
00:57.0
To begin with a check on Asian markets, they are in positive territory in early Tuesday trade, mirroring gains on Wall Street overnight.
01:06.5
Taking a look at the board now, the Nikkei 225 is ahead of the pack, climbing six-tenths of a percent.
01:13.7
South Korean and Australian shares also edging higher.
01:17.5
Investors turning their focus on China amid a report the head of the central bank wants creditors engaged in debt restructuring.
01:26.3
Meanwhile, the NIC225 is ahead of the pack, climbing six-tenths of a percent.
01:26.8
South Korean and Australian shares also edging higher.
01:26.9
Investors turning their focus on China amid a report the head of the central bank wants creditors engaged in debt restructuring.
01:27.0
Meanwhile, Australia's business activity in April expanded at its fastest clip in 24 months.
01:33.3
Japan and India's PMI numbers also set to be released today.
01:37.7
In commodities, oil continued to fall after Iran said it will not escalate the conflict with Israel.
01:45.1
Investors had been concerned higher oil prices could contribute to inflation, leading the Federal Reserve to hold off on cutting rates.
01:52.9
Gold, meanwhile, opened steady after tumbling 2.7%.
02:00.7
Stateside, U.S. stocks ripped higher Monday, recovering their footing after a tough week following the rebound of tech shares in anticipation of the release of major earnings.
02:11.3
The S&P 500 topped the 5,000 level, halting a six-day route.
02:17.1
The Nasdaq also rose more than a percent with Nvidia, leading gains in big tech.
02:22.6
While the Dow climbed nearly seven-tenths of a percent.
02:26.2
Now this will be a crucial moment for the S&P 500.
02:26.8
A crucial week for markets with big tech earnings and Friday's key inflation data having the potential to redefine the near-term trajectory of the market.
02:38.9
So I think what we saw, especially what's driving the stocks, what we saw last week was a big tech sell-off.
02:45.9
And this week is in anticipation of the first big tech companies reporting their names, reporting their earnings.
02:53.3
So actually there's a lot of nervousness in the markets.
02:56.8
And they're expected to grow their earnings over 60% in the first quarter.
03:01.8
So that's actually a pretty high bar to clear.
03:04.2
So what we see in the market is an anticipation and kind of, yeah, what will happen?
03:10.3
By how much will they, what they will report?
03:14.0
Will they exceed?
03:16.1
And especially what they will guide going forward.
03:20.8
Taking a look now at U.S. futures, they are pointing to a mixed open with the S&P 500 and Nasdaq.
03:26.8
Likely to lose ground.
03:29.9
Now here's a look at local corporate stories we're watching out this morning.
03:34.4
Bank of the Philippine Islands delivers record earnings in the first quarter.
03:39.0
Net income was up 25% over 15 billion pesos as higher revenues offset the impact of higher operating expenses and provisions for losses.
03:49.6
Revenues were at 39.5 billion pesos, driven by 30 billion pesos in net interest income.
03:56.8
As the Ayala-led bank continued to enjoy the high interest rate environment.
04:01.0
As for its total assets, it grew to over 3 trillion pesos.
04:07.2
Meanwhile, Megawide further swings to profitability.
04:10.7
It posted 269 million pesos in profits in 2023, reversing the 1.9 billion peso net loss the year before that.
04:20.1
Revenues climbed to 18 billion pesos as Edgar Saavedra's construction firm saw improvement across all sectors.
04:26.8
And finally, DragonFi, the joint venture of tycoons Edgar Saavedra II and Jollibee Group's Ston Tangkaktyo, launches a new mobile investing app, DoubleDragon, says DragonFi 2.0 is a platform that aims to make investing easy and accessible for Filipinos.
04:49.1
Among the app's features, users can manage their portfolio from local stocks to even global funds.
04:54.9
It also connects their financial debt.
04:57.1
It also connects their financial debt.
04:59.0
It also connects their financial debt.
05:03.2
More corporate news.
05:04.9
Federal Land, the real estate developer of listed firm GT Capital Holdings, further expanding its footprint outside Metro Manila.
05:12.8
The company announced it will launch its latest residential project that will be called Meadowcrest next month.
05:19.4
The project, the firm's first venture into horizontal development, is a 48-hectare neighborhood township.
05:26.8
The firm adds amenities will be accessible within a 15-minute walk, bicycle or car ride from the neighborhood.
05:38.1
The Philippine Science and Technology Department's Nuclear Research Institute is seeing a solution to the recent power woes in the country.
05:46.3
Luzon and Visayas were repeatedly placed under red and yellow alerts last week due to forced outages and weak capacity of power plants.
05:54.5
But the PNRI says,
05:56.8
These incidents could be avoided if nuclear energy is added to the country's power mix.
06:04.3
If the electricity mix contains substantial nuclear, that won't happen because capacity factor of nuclear is 90%.
06:12.8
The more you increase the percent of nuclear in the mix, the more reliable the electricity will be, less dependent on weather.
06:21.2
The plant maintenance is scheduled one month every 18 months.
06:26.8
The research institute also allaying concerns about the safety of operating nuclear power plants in the country.
06:37.8
There have been only two accidents of note.
06:41.9
The Chernobyl, which was done because it was an experiment, illegal experiment, and then Fukushima.
06:47.8
In Fukushima, the plant was not destroyed by the earthquake.
06:51.3
It was destroyed because the cooling system was put below.
06:56.8
In 2003, infrastructure of the basements .
07:01.1
All the 450 nuclear plants in the world after Fukushima, it did a stress test.
07:04.3
How will you prevent Fukushima?
07:06.4
You put your cooling systems at a higher elevation.
07:09.8
So that means, it makes the possibility of a nuclear accident even much much much lower.
07:16.4
The Marcos administration has been seeking to include nuclear energy into the country's energy mix by 2032.
07:22.7
The Philippines and the U.S. last year sign a landmark deal
07:25.7
they would focus on food production at the end of the year for its natural gas jeans.
07:26.3
that would facilitate cooperation on the peaceful uses of the alternative energy source.
07:35.8
To talk to us more about nuclear energy and what we could expect moving forward,
07:40.3
we have with us Pangasinan Representative Marco Juanco.
07:43.2
He's also the chairperson of the House Committee on Nuclear Energy.
07:48.0
Representative Juanco, welcome to the Market Edge.
07:50.9
Good to have you here.
07:51.4
Yes, good morning everyone.
07:56.3
All right, all right.
07:57.8
Now, power has always been a problem in the country on ordinary days,
08:01.6
much more during hot months like this one, when demand surges, as we are experiencing now.
08:08.5
This helps build a case now for us to look at other sources of energy,
08:13.1
one of which is nuclear, which you're advocating.
08:15.8
Tell us why nuclear energy makes sense now.
08:18.8
Yes, because it's intrinsically cheap,
08:24.4
especially as far as...
08:26.3
foreign exchange expenditure yearly is concerned.
08:30.3
The difference is like 20 times cheaper.
08:34.9
We're talking of, for a typical plant,
08:37.9
say $20 million a year for nuclear fuel
08:44.9
versus around $500 million a year for imported coal or imported LNG.
08:53.2
So if you start with an intrinsically cheap,
08:56.3
energy source, and one that's also ultra-reliable,
09:01.9
it has the highest capacity factor of any generating technology,
09:06.3
then you will have both cheap and reliable.
09:10.6
And in terms of initial investments, how big do we need to have or to spend
09:14.5
to be able to at least operate one?
09:18.3
If we are talking about the Bataan plant, that's our cheapest option and our quickest option
09:24.2
that can be running in four years.
09:28.9
We did a study, and it would come out to be less than 3 pesos and 50 centavos per kilowatt hour
09:41.8
during the capital recovery period of 20 years.
09:45.3
That includes profit and return on capital.
09:49.0
Now, after that period, for 60 more years,
09:52.4
you're talking about a total cost of 1 peso and 30.
09:56.3
per kilowatt hour.
09:58.9
Compare this to the average 7 pesos per kilowatt hour
10:03.5
which Meralco has just awarded to the winners of the auction
10:08.7
for 15 more years of 3,000 megawatts coal power.
10:14.0
There's a huge difference.
10:16.1
Okay, you mentioned about the Mothball Bataan nuclear power plant.
10:20.3
You've had inspections, as you've said.
10:22.1
What is the state of the facility now,
10:24.1
and is it something that we need to spend a lot of money on?
10:26.3
Money for to rehabilitate?
10:28.9
Well, let's put it at a very inflated number of 2.2 billion US dollars.
10:37.0
Which needs to be validated.
10:41.6
The plant is 100% complete, extremely well built.
10:47.0
It needs to be commissioned.
10:48.8
That is the only lacking step.
10:51.1
There is precedent in the United States.
10:53.8
One can look in the internet at WhatsApp.
10:56.3
Bar 2 nuclear plant in Tennessee,
10:59.3
which was initiated six years prior to our Bataan plant,
11:05.1
and was only 60% complete, not 100% like ours.
11:09.7
And it became America's newest nuclear plant.
11:14.5
It became America's newest power plant in 2016.
11:21.2
It was granted a 40-year operating license,
11:24.0
and is entitled to two 20-year extensions.
11:26.8
For a total operating lifetime of around eight years.
11:31.1
And when you talk about the cost,
11:32.9
it is not just us shouldering everything.
11:34.9
I suppose this can be done.
11:36.2
No, because we already have the plant,
11:39.0
and it's already completed.
11:41.6
That would be our equity contribution
11:44.3
to whoever partner would finance the completion
11:48.4
or the commissioning of that plant.
11:50.9
So, it's a good deal.
11:53.0
Something that we should not walk away from.
11:56.3
Alright, Congressman Kohanko,
11:58.3
the use of nuclear energy, of course,
12:00.3
could be against the grain in terms of the widespread shift now to other renewables.
12:05.0
Now, when you talk about costs and reliability,
12:07.6
why do you think nuke energy would serve us better
12:10.7
versus the other sustainable, said to be reliable,
12:15.2
and natural, more natural sources of energy?
12:19.1
In fact, the trend is quite the opposite now.
12:22.2
I went to COP 28 in Dubai,
12:25.3
Okay. I went to COP 28 in Dubai,
12:25.8
Okay. I went to COP 28 in Dubai,
12:26.2
and for the first time, the first COP where it's ever happened,
12:30.0
we have six major countries, including the United States,
12:33.4
the UK, France, Korea, UAE, Sweden,
12:38.0
declared that net zero by 2050 is impossible without nuclear,
12:44.2
that the world should triple nuclear power by 2050,
12:50.2
and that they will push for the availability of around 9.2 trillion,
12:56.2
US dollars in low-interest financing for nuclear new build.
13:01.6
These main countries are supported.
13:06.7
Their total group now of 25 countries,
13:09.5
and they targeting to have 40 countries by the end of the year.
13:15.9
All right, we've so far tackled costs,
13:18.6
the benefits to the consumers in terms of more stable power supply.
13:23.4
The U.S.A., the U.S.A. now is barutering.
13:25.0
all right, we've so far tackled costs, the benefits to the consumers, in terms of a more stable power supply.
13:26.2
It's reversed itself. They're actually even bringing old shutdown plants back into service. There's a good example in the Palisades nuclear plant in Michigan where the government, both the state and federal government are giving all-out support for the reactivation of this plant.
13:51.1
All right. We're really after improving infrastructure in the country to lure more investment.
13:57.2
My message to you is that the DOE's targets for nuclear in the Philippines are very anemic so that vendors might not be interested, investors might not be interested.
14:12.6
I see that there is a lot of space for 16,000 megawatts of nuclear by 2045.
14:21.1
All the way up to 32,000 megawatts by 2045. Just look at the numbers of NEDA and the old, the previous DOE statements on the target for total capacity by 2040 only.
14:39.1
It goes up to 68,000 megawatts total capacity. We are now at 22,000. NEDA says minimum of double. That's 44,000. There's a lot of space.
14:51.1
All right. I'd like to talk about what you mentioned in earlier press conferences. To manage nuclear waste, you're proposing a nuclear waste facility to be put up on Pag-asa Island in Palawan.
15:02.9
What is the rationale behind this proposal which I'm sure will be met by opposition of pro-environment groups?
15:10.0
Well, it's in the most stable geological location possible in the Philippines because Palawan is considered.
15:21.1
Continental in its bottom. So there are no earthquakes there.
15:26.3
And then we are going to do a deep borehole, two kilometers deep and then horizontal. So two kilometers horizontal.
15:37.2
And the elements would be placed there in hermetically sealed stainless steel sealed canisters backfilled with bentonite and concrete so that it is a.
15:51.1
And cost free finality. In other words, it's gone forever. But we should think twice before we do that because the energy extracted from the spent nuclear fuel in our current use open cycle is only 4% of the energy. So there's 20 times more energy in that in that spent fuel that is should be.
16:21.1
Our grandchildren's almost free fuel in their generation for isobreeder reactors.
16:29.7
Okay. Let's talk about your committee. Now, there have been efforts by the Special Committee on Nuclear Energy at the House of Representatives to push for nuclear energy usage. Now, what strides have you made so far? Where are we now in those plans?
16:41.7
Well, the most important two bills, the bills are creating the regulatory authority, the Philatom.
16:51.1
Uh, was already passed on third reading last November. It is in the Senate. And there's a second bill regarding nuclear liability, which already passed in February. It's also in the Senate.
17:06.6
Uh, what is very concerning is that the DOE itself, uh, is trying to complicate the bill in the Senate. So, uh, it will be delayed.
17:19.4
They're also trying to.
17:21.1
Consolidate the bill. But, you know, we have in the legislature rules that say, uh, one topic per bill. So I don't know what their game is. Uh, my sense is that, uh, there are interests in the DOE who seek to delay nuclear power. And, uh, this is, uh, being manifest now.
17:41.7
And has this been certified as urgent by the president?
17:51.1
The DOE for this, uh, you have the, uh, uh, the Natural Gas Downstream Act, which was certified as urgent and which was already passed into law.
18:03.3
Uh, bakit po nauna pa yan? Isa ang ating nuclear bill when, uh, imported LNG is even more expensive than our, uh, imported oil from Indonesia.
18:15.9
By the way, you know, um, uh, if you have a typical...
18:21.1
plant, uh, size PNPP 600 something megawatt, you would be spending, uh, around 500 million US dollars a year on fuel. If it were a nuclear plant, you would only be spending 20 million dollars. So there's a huge cost difference. Now, are there, are, is the DOE protecting vested interests? I think this is a question that is, uh, of public importance.
18:48.3
And have you spoken to the president about this?
18:51.1
recently, the president had trips in the US, and there have been investors keenly, uh, interested in financing to put the nuclear power plants online in the Philippines.
19:01.1
Yeah. Uh, another complaint I have about the DOE, uh, they, uh, uh, the, the secretary himself in testimony to our committee refuses to initiate, uh, having IGA's, uh, intergovernmental agreements with the over 40 vendor companies.
19:21.1
gasoline companies, uh, which deal
19:43.8
There are 44 or 40, close to 50 other nuclear vendor countries which are important.
19:52.6
For example, the UAE has a huge sovereign fund.
19:56.1
How will they discuss with us if we don't have the agreements with them?
20:01.5
What about Japan? What about Korea, Canada?
20:05.0
These are, the U.S. is not geared to manufacture nuclear plants now.
20:10.5
Their supply chain is not practiced.
20:17.7
The big supply chains in the West are Japan, Korea, Canada, and the like.
20:24.4
So where are our agreements with these countries?
20:29.2
You know, this agreement is very simple.
20:31.7
It's like 10 or 15 pages.
20:34.0
All it says is that we will not use this technology for weapons,
20:39.5
that we will use it.
20:40.5
We will use it for peaceful uses like generating power.
20:43.4
That's all it needs to say.
20:46.3
Lastly, Representative Kwanco, you might have one good thing going for you,
20:51.4
you know, public opinion.
20:52.9
There have been consultations.
20:54.4
These were held in various provinces such as Mindoro and as far north as Ilocos
20:59.3
and down to Sambuanga and Sarangani.
21:01.7
What sorts of reactions have you been getting, if you can share with us?
21:05.8
Great interest, especially.
21:07.6
I approached them on the fact,
21:10.5
you know, the option of obtaining social license from locals
21:16.2
by offering the nuclear entities who are going to build
21:23.7
to offer free electricity to the localities.
21:27.6
So they see it as an opportunity to leapfrog economically
21:34.7
if they believe that if they have among the cheapest electricity in the Philippines,
21:40.5
that industry business would go locate in their locations
21:46.4
and it would be a big boost to job creation and quality jobs.
21:53.7
Pangasinan Representative Mark Kwanco,
21:55.5
thank you so much for this conversation on nuclear energy today.
21:58.4
Have a great morning.
22:02.4
Philippine agriculture officials eyeing a 10-day buffer stock
22:05.7
on key agricultural products in a bid to stabilize commodity prices.
22:13.4
The National Price Coordinating Council convened Monday for its regular meeting
22:17.8
to address concerns on price stabilization and food supply.
22:22.9
Among the policies proposed to be implemented is having a 10-day buffer stock
22:27.7
for agricultural products.
22:29.8
The Trade Department said commodities eyed for procurement by the Agriculture Department
22:34.3
are products identified to be drivers of inflation, namely rice, corn, sugar,
22:40.2
onion, pork, and fertilizers.
22:42.9
Ang goal po sana nito, in addition to creating a market-based mechanism to decrease the price
22:49.6
by increasing the supply, magiging deterrent din po siya sa mga hoarders at saka those
22:55.9
who are engaged in illegal price manipulation.
22:59.4
Nograles noted that if implemented, this will be the first time that buffer stocking for
23:04.3
agricultural products will be invoked under the Price Act. Section 9 of the Price Act
23:09.7
gives power to the implementing agency to procure, purchase, import, or stockpile basic
23:16.1
commodities and to distribute this for sale to address supply shortage or if there is a need
23:22.0
to effect changes in its prevailing price. While the National Food Authority is mandated to manage
23:27.5
the country's rice buffer stocks, its main purpose is to stockpile for calamities.
23:33.3
If the Price Act is invoked, government-procured rice may be sold in identified areas for
23:39.7
Ang lumalabas, pag merong stock tayo, may buffer stock tayo, syempre parang isipin nila
23:47.5
na parang the government can intervene anytime and it will be a deterrent for illegal price
23:55.1
Nograles added that the Banco Central ng Pilipinas projected during the meeting that inflation
24:00.2
may shift towards the upper end of the government target of 2 to 4 percent, driven by the increase
24:06.5
in prices of rice, vegetables, and meat.
24:09.7
Thus, the need to procure buffer stocks for certain commodities that may have an inflationary effect.
24:15.6
For DTI, partnerships with the private sector are needed for storing agricultural products should
24:21.3
the 10-day buffer stocking be implemented.
24:24.1
Napag-usapan na so far sapat ito para tugunan nga yung posibleng mga problema when it comes to
24:30.6
stabilizing our prices. So 10 days stock. At nakipagtulungan yan sa private sector para ma-ensure na yung
24:38.3
10 days worth of inventory.
24:39.7
May paglalagyan, no? Whether that's warehousing or cold chain storages.
24:45.3
While the DA is looking to craft the implementing rules and regulations for the 10-day buffer
24:50.3
stocking of agricultural products, DTI said an IRR is not required under the Price Act
24:56.4
for the implementing agency to implement it.
24:59.7
Lady Vicencio, ABS-CBN News.
25:04.5
Still on agriculture, the National Food Authority raises the buying price for unharmed
25:09.7
rice in the Philippines. The price range, which took effect Monday, is now at P17 to P23 per kilo
25:17.1
for fresh or wet palay, and at P23 to P30 per kilo for clean and dry. The agency says this will help
25:25.4
increase the country's rice buffer stock and do away with single pricing nationwide.
25:31.7
Agriculture Secretary Francisco Tiu Laurel Jr. believes this would help the NFA achieve its target
25:37.1
purchase of some P300,000.
25:39.7
A metric tons of rice buffer stock this year.
25:44.6
State Weather Bureau of Pagasa reports five major dams across the country saw a decrease
25:49.7
in water levels on Monday. These are the Angat, Ipo, Lamesa, Muklao, and San Roque dams.
25:57.4
Pagasa, however, notes all of the dams remain above the minimum operational level, with
26:03.2
the exception of the Pantabangan Dam. As for Angat, which supplies almost all of Metro
26:09.7
Manila's water needs, the water level was over 191 meters, still above its minimum operational
26:16.7
level. Water officials, meanwhile, admit they cannot say for certain if this will lead to water
26:22.9
interruptions in the coming days. But water concessionaires have already vowed to be prepared
26:29.0
in addressing the possible shortage in the supply.
26:34.7
Now here's a look at the other stories we're tracking today happening in the next hour.
26:39.7
Group Piston, will hold a picket protest in front of the Supreme Court to call for the
26:44.2
immediate release of a temporary restraining order against government's PUV modernization
26:49.2
program. And at three in the afternoon, the Philippine Migrant Workers Department will
26:54.5
give updates on the situation of overseas Filipino workers affected by the recent UAE
27:00.0
floods and Canada deployment. Also on tap today, President Marcos' visit to Occidental Mindoro.
27:09.7
contract signing of ANC's parent firm, ABS-CBN, and All TV.
27:17.1
We're going on a short break, but stick around because when we come back, we give you the opening
27:22.1
numbers at the PSEI. We'll also bring in ATR Asset Management Trust's Jose Miguel Liboro for a market
27:29.1
analysis. Stay with ANC.
27:39.7
Welcome back. You're still watching Market Edge. Philippine shares closed flat on Monday with the main index picking up less than a tenth of a percent.
28:09.7
Joining us now for more on the markets and the global factors at play, Jose Miguel Liboro is the Vice President and Head of Local Markets at ATR Asset Management Trust Corporation.
28:20.5
Hi, Jose Miguel. Welcome to Market Edge.
28:24.0
Hi. Morning, Stanley. Thanks for having me.
28:25.8
All right. Let's talk about the U.S. markets now. U.S. investors on edge on tech earnings with, of course, 2023 performance quite hard to top, if you recall correctly.
28:36.6
This was one of the reasons why there was robust trade.
28:39.7
And great prices in the latter half of 2023, mostly concentrated on these tech stocks.
28:47.4
Now, how do you see, do you see, in fact, tamer performance now from these issues this year?
28:53.1
Because the recent price gains in the U.S. markets was mainly driven by tech.
28:57.9
And a lot of investors are eager to see if, you know, these companies will outperform their 2023 performance.
29:07.2
Sure. I think you kind of answered your question.
29:09.7
Good question there. Yes, we do forecast, I guess, more muted returns this year.
29:14.8
But we're generally still positive.
29:16.4
I think from a macro standpoint, it looks like global equity markets should still be able to push higher, tech being among the leading sectors still.
29:26.3
But given the higher base already, probably more marginal or muted returns than what we saw over the last year.
29:33.7
And how do you see the general global market performance today?
29:37.6
Following a slight easing of tensions in the midterms?
29:39.7
Middle East, because we saw global fuel prices decreasing, I mean, reacting favorably.
29:45.5
As for stocks, we've even had some recovery yesterday at PSEI.
29:50.0
Is this something that we can sustain?
29:53.0
I think very difficult to predict how these geopolitical risks are going to play out.
29:58.9
But generally speaking, as long as there isn't a significant escalation, and in fact, as you pointed out, a bit of a de-escalation and more of that, hopefully.
30:08.1
Then yes, from a fundamental standpoint.
30:09.8
I do think that there's a lot of room for the markets, particularly locally, to push higher.
30:17.0
So we just have to make it through, I guess, the noise.
30:21.9
Let me just bring in the opening numbers at the PSEI.
30:24.5
We opened at 64.44 and now we're a third of a percent up, 64.83, just a few minutes after trading.
30:32.4
Now, when you talk about Philippine shares, now trading in the 6400 range, dragged, of course,
30:39.7
by the Middle East conflict and the extended rate-cutting horizon by the BSP, which the market is also repricing.
30:46.4
Are we expecting another season of lackluster trading at PSE, given the thinning trade volumes, really?
30:54.0
I think very important to remember that over the first quarter, we actually had a fairly substantial start, quite a sharp move up, and then an increase in trading volume as well.
31:05.1
So realistically, it would have actually been very difficult to sustain.
31:09.7
It would have been a linear move higher in that manner.
31:13.2
So while, of course, a bit volatile, the recent pullback we've seen, I think, lays the foundation for a more sustained move higher throughout the year.
31:24.2
We do expect volumes to pick up after the recent round where they've suffered a little bit, but we are positive in the market.
31:32.3
We do see opportunity for recovery.
31:36.5
And at this point, your best case for support and resistance?
31:39.7
Sure. When we broke the 6500 level initially, the fear is actually that we enter the next technical range, which is the 6200 to 6300 area, a range of levels that we unfortunately are all too familiar with over the last few years.
31:58.1
While it's not impossible that we go back to those levels, certainly, especially if there is indeed an escalation in geopolitical risk,
32:08.0
the fact that we have a lot of risk, we're not going to be able to do much about it.
32:09.2
But we have a lot of risk.
32:09.2
And we have a lot of risk.
32:09.7
So the fact that we haven't kind of just instantly gone back there on the break of 6500 is, I think, quite optimistic, quite positive.
32:18.7
And given the relaxation or de-escalation we're seeing, I think that the fact that the market has held, even having no significant reason to at that point, from a short-term standpoint, is positive and supportive of an up move.
32:33.8
But the trip, the journey towards 7000 is really difficult to hit at this point.
32:39.7
Looking at resistance levels of 6700, is that still the same for you?
32:45.0
From a technical standpoint, yes.
32:47.1
Absolutely, we would run into some difficulty maybe initially at 6500.
32:51.7
Then, as you pointed out, 6700.
32:53.4
But from a fundamental standpoint, I think that there's more than enough, I guess, macro rationale for us to get and breach those levels.
33:03.6
We're actually looking still at, while optimistic at this point in time, at above 7000.
33:09.7
Close for the end of the year still.
33:11.7
Okay, let's look at other investment instruments now.
33:14.3
What opportunities do you see outside stocks right now?
33:17.9
I mean, are bond yields also as appetizing for investors looking away from risky assets at this time?
33:24.9
I think over the last two years, maybe part of the reason why the equity market has lagged has been that that has been the prevailing theme with bond yields over the last two years outside of 2018,
33:37.4
having been at the highest absolute levels.
33:39.7
Over the last 10 years.
33:41.7
So that's still very much the case.
33:43.6
We are off the highs that we saw last year, but just below them.
33:48.7
So, yes, I think right now, bond yields are still a very enticing prospect and not one that we expect to stay this high for long.
34:02.1
Let's talk about the specific sectors now.
34:04.5
We know that the high interest rate environment will affect growth, especially for investors.
34:09.7
Sensitive stocks or interest rate sensitive stocks.
34:12.4
Now, how are you seeing expansions for these companies for the rest of the year, given that, you know, those rate cuts might come the much, much later part of the year?
34:22.3
I think it might give a little bit of an adjustment to planned CapEx programs, but I don't think it alters them significantly.
34:33.3
While we are while, of course, the conversation over the short term has changed to when the.
34:39.5
Cut start, I don't think that there is any serious discussion of whether they will happen at all.
34:46.2
So the trajectory, I think very clearly tilted lower still and just a matter of the timing being pushed, perhaps incrementally further.
34:57.1
Another topic in celebration of the fund managers associated with the Philippines are putting out important issues and initiatives affecting investors, investments and even fund managers.
35:06.8
A few of which are, of course, reforms in the capital.
35:10.1
This includes decreasing the commission and broker fees as well as taxes.
35:15.0
Are you seeing advances now as a result of these reforms?
35:19.3
Well, I think, as you pointed out, there was a recent announcement from the SEC on an adjustment or the removal of the minimum broker commission.
35:30.1
I think certainly over the longer term, that will be market positive for trading liquidity and market depth, but actually as a letter that the.
35:39.5
As the or the Philippine Association of Securities, Brokers and Dealers sent recently in response to that for it to have a really significant or meaningful impact, ideally, it's also accompanied with other reforms and not taken in isolation.
35:55.8
So I think the hope is that certain planned reforms which are already present in the existing form of the Fita package are hopefully accelerated.
36:07.6
Um, maybe pointing out.
36:09.1
Maybe pointing out the lowering of the stock transaction tax currently sitting at 0.6% to something lower.
36:16.5
I believe over the long term, the target is 0.10% or 10 basis points.
36:21.6
But if there's a chance that that particular reform can happen sooner or at a more accelerated pace than was originally planned, then not taken in combination with the recent announcement of broker fees will be a significant reduction in.
36:38.6
Friction costs and I think.
36:42.1
Quite a significant boon to potential trading activity.
36:47.8
Although I know this is not a unique problem to the Philippine market.
36:51.7
I'm sure a lot of emerging markets are also in dire need of foreign funds.
36:56.4
Now, which reform do you think should be necessary to, you know, make our capital markets attractive again to foreign funds?
37:03.9
I think ultimately, at least anecdotally also based on all the conversations.
37:08.6
with foreign investors,
37:11.7
they really just highlight
37:12.8
continuously two major topics.
37:17.1
and the other is efficiency
37:19.1
or friction costs.
37:20.9
So, liquidity, of course,
37:22.4
is a bit chicken and egg.
37:24.2
Lest they come in more significantly
37:26.4
than it stays very much
37:27.9
a shallow pool or small pool,
37:31.1
So, what they've highlighted
37:32.7
is in order for them to come in,
37:35.1
one of the things they're looking at
37:36.2
are, of course, friction costs.
37:39.7
on withholding tax for bonds
37:44.0
for equity securities,
37:46.4
I think would definitely be
37:48.5
a step in the right direction.
37:49.9
These are also reforms
37:52.6
in the current iteration
37:53.9
of the PFITA package.
37:57.0
these are accelerated.
37:59.2
that they push through.
38:01.4
those will be significant factors
38:04.0
with respect to raising
38:05.2
our relative value
38:06.3
in the consideration
38:08.6
of foreign investors.
38:11.5
And then, as we already discussed earlier,
38:13.6
the lowering of other friction costs
38:16.0
is also potentially
38:18.2
a significant consideration
38:20.9
for them as well.
38:22.3
The moment we lower
38:23.0
these barriers to entry,
38:24.8
particularly against
38:26.1
our regional peers
38:27.2
which have generally
38:29.2
lower taxation rates,
38:32.7
and lower transaction costs,
38:35.2
then we become far more competitive
38:36.9
with them and more enticing.
38:38.6
And lastly, Jose Miguel,
38:39.9
on the flip side of that
38:44.7
Is there anything else
38:45.8
the regulators can do
38:46.8
to open the markets
38:47.8
to more retail investors
38:49.5
in the Philippines?
38:52.7
Actually, I think the regulators
38:54.0
have been very supportive,
38:55.1
particularly over the last few years
38:57.0
on their efforts,
38:59.4
particularly to increase
39:00.6
market depth or penetration.
39:03.6
I guess some things
39:04.8
that are already being moved on
39:06.2
but that we hope,
39:08.6
improves even further
39:09.7
or is accelerated
39:11.2
are the PERA initiative
39:14.3
pension reform initiatives,
39:16.5
which, apart from making
39:18.1
market penetration larger
39:20.4
and increasing market liquidity,
39:23.4
makes that money a bit stickier
39:25.0
because it is longer-term money
39:26.6
in the service of saving up
39:28.1
for one's retirement.
39:30.1
So maybe more focus on those
39:33.3
even from the private sector
39:35.3
from an educational standpoint.
39:38.6
I guess that would be
39:43.2
kind of where I think
39:45.8
the crux would be
39:49.0
we thank you so much
39:49.6
for joining us this morning,
39:51.1
Jose Miguel Liboro
39:51.9
of Atram Trust Corporation.
39:54.3
Have a great day.
39:57.5
as we reported earlier,
39:59.1
trading officially kicks off
40:00.2
at the Philippine Stock Exchange
40:02.2
I look at the opening numbers.
40:03.6
The main index is at 64.63,
40:06.5
up by three-tenths of a percent.
40:08.6
So far at 567 million pesos
40:11.5
with advancers outweighing
40:13.4
decliners 61 to 20.
40:17.6
We're taking a quick break.
40:19.3
amid the celebration of Earth Day,
40:20.9
how can the Philippines address
40:22.1
the worsening plastic pollution
40:25.0
We'll speak with plastic banks
40:26.2
David Katz about that next.
40:29.0
we'll be right back.
40:38.6
We're back on Market Edge.
40:45.2
Yesterday, people across the world
40:46.6
celebrated the annual Earth Day
40:49.4
Planet vs. Plastics.
40:52.0
a 2021 study showed
40:53.3
the Philippines is the worst
40:54.3
plastic polluter of oceans,
40:56.9
contributing to over a third
40:58.3
of the global plastic waste.
41:00.6
To talk to us about
41:01.3
how we can address
41:02.5
this serious environmental concern,
41:04.6
the founder and CEO
41:09.1
Again, welcome to the show.
41:11.3
Thank you for having me here, Stanley.
41:13.0
It's good to have you here.
41:14.4
the Philippines as a plastic polluter
41:16.3
is a reputation we need to shed off,
41:18.7
and it is an uphill battle.
41:20.7
What are we doing wrong
41:21.9
that we are still stuck on that list?
41:25.4
there's a lot to be in the consideration
41:28.0
about what's being done right as well.
41:30.7
And the Philippines as well
41:32.2
is leading an extended producer
41:33.8
responsibility law
41:36.2
that is ensuring that
41:38.0
producers are responsible
41:39.5
for the material that they're producing
41:40.9
and putting out in the environment,
41:42.0
including the end of life.
41:43.3
So that's certainly,
41:44.6
I think, very good.
41:46.8
what we need to address
41:47.8
and when we look globally
41:49.1
at the amount of plastic
41:50.8
entering the ocean,
41:51.7
we can see that 80%
41:52.8
is coming from areas of poverty.
41:55.6
And we still have a long way
41:57.3
to go within the Philippines
41:58.4
and what we can address
41:59.4
in all of the islands
42:00.3
and everything else that's occurring.
42:02.1
And if people just don't have
42:03.7
to manage their waste,
42:05.4
it ends up in the environment.
42:08.0
That's the issue.
42:10.3
So it's really linked
42:11.6
to poverty in a way.
42:13.0
Now, David, you know,
42:14.8
conversations about plastic pollution
42:16.3
always turn into a blame game
42:19.7
I mean, some are saying
42:20.5
it's government's responsibility
42:22.8
and enforce them.
42:24.1
Others are saying
42:25.1
it is the task of big business
42:26.7
to find sustainable packaging.
42:28.3
The public's also blamed
42:29.4
for a host of other reasons.
42:31.8
Now, how do we go
42:32.8
beyond that discussion,
42:34.8
those conversations,
42:35.7
and really do something concrete?
42:38.0
Do something significant
42:38.9
about the plastic pollution problem?
42:41.6
Well, it is a solution
42:43.6
that includes all of us.
42:45.5
It's everybody, everything.
42:47.4
Certainly creating the laws
42:49.0
that have public corporations
42:51.8
responsible for the material
42:54.8
and let me explain,
42:56.2
that in a public corporation,
42:58.0
the fiduciary duty of the CEO
42:60.0
is to return value to shareholders.
43:03.0
So doing things that contravene
43:06.0
returning shareholder value,
43:08.0
can be punishable by jail.
43:13.5
although passionate about the environment,
43:15.5
doesn't have the ability to do that.
43:17.7
Now, in combination
43:18.9
with the appropriate government legislation,
43:21.3
a law that deems the responsibility
43:24.6
placed on that corporation,
43:28.8
has the CEO then be able to act
43:30.9
on behalf of what's right
43:32.1
for humanity and the planet
43:34.9
and shareholders.
43:36.7
He now has the ability
43:37.7
to say, it's the law.
43:39.3
It contravenes shareholder return,
43:42.4
and it's necessary that we do it.
43:44.8
So it's the combination
43:46.2
of both the corporation,
43:49.4
and the individual
43:50.3
that also has the ability to say
43:52.7
no to excessive use of plastic,
43:56.4
no to single-use material,
43:58.1
no to virgin material,
43:59.7
yes to regenerative materials,
44:03.0
So it's a combination of all,
44:04.3
and you're right,
44:05.2
we've all been playing the blame game
44:07.6
I'm blaming someone else.
44:09.2
Okay, I think at least we have
44:10.3
a few things going great for us.
44:12.7
I mean, you know,
44:13.3
we have individual efforts
44:14.3
by private groups like yours
44:16.2
with a goal of contributing solutions.
44:19.4
tell us about this group,
44:20.9
a bit of what you do,
44:24.2
Well, recognizing that most of the plastic
44:26.6
that is entering the ocean
44:27.8
is coming from areas of poverty,
44:29.5
we treat plastic like money.
44:31.7
We've got over 200 locations
44:33.3
within the Philippines
44:34.2
that allow the communities
44:37.6
and return their plastic,
44:39.4
and have it deposited
44:40.7
into a bank account
44:41.8
so they can earn financial inclusion,
44:45.5
to borrow zero-interest loans,
44:47.5
earn the ability for food vouchers
44:49.1
for insurance and other things as well.
44:51.6
Our goal ultimately
44:52.9
is a world without waste.
44:54.7
Not a world without plastic,
44:56.5
but a world where that waste
44:58.0
isn't thrown into the environment.
45:01.0
That's in a synopsis of it all.
45:03.6
Now, the material we return back
45:05.1
to big corporations
45:06.3
on a higher level,
45:09.3
the extended producer responsibility law,
45:12.5
providing a space
45:13.6
for big corporations
45:15.7
to be responsible
45:16.5
to collect the material
45:17.7
and return it back to packaging,
45:23.0
through the blockchain banking application
45:25.4
that we implement.
45:26.7
So anyone who's watching
45:27.9
that's responsible,
45:29.3
that is in need to facilitate that law,
45:32.3
we work with them
45:33.3
to ensure that they're compliant with the law.
45:37.6
I was looking at some numbers,
45:38.6
very encouraging numbers here
45:43.8
120 million kilograms of plastic
45:47.1
stopped from entering our oceans.
45:49.2
That's 5.9 million kilograms
45:50.7
of plastic gathered
45:51.9
in the Philippines alone.
45:53.7
Now, what does this tell us now
45:55.0
about the advocacy being effective
45:56.5
and even impactful?
45:58.7
Well, it tells us
45:59.8
that we have a new generation
46:01.0
that is entering this economy
46:03.6
that is looking for change.
46:08.4
in the Philippines
46:10.9
knowing that the,
46:12.6
the country is a big contributor,
46:14.5
but they're also inspired to be
46:16.2
in leading the change
46:17.3
for the world as well.
46:18.9
Many things are occurring.
46:20.2
Those are our numbers
46:21.1
and there's many organizations
46:23.8
that are approaching as well.
46:25.3
So lots of change occurring.
46:27.2
And what we need to be
46:27.8
in the recognition of,
46:29.0
especially in business,
46:30.1
is that the next generation
46:31.5
is looking for purpose.
46:33.8
And they're looking to enter
46:34.8
the purpose economy
46:35.7
and the organizations
46:36.9
that they're working for.
46:37.2
They're working with
46:38.0
to be a part of that solution as well.
46:40.6
So everything is leading
46:41.8
in the right direction.
46:44.3
Also still part of those basics
46:46.4
for plastic pollution problems.
46:50.2
whether it's big or small
46:53.7
reducing single-use plastics.
46:55.2
That has been a campaign.
46:56.7
Calls have been made about this.
46:58.4
Can you give us a sense
47:00.3
that we are making?
47:02.1
Is it really gaining traction
47:03.3
after a couple of years?
47:06.1
it's gaining traction.
47:07.2
Could it be faster?
47:08.8
Could we be doing more?
47:10.8
But every journey
47:11.7
begins with a step.
47:14.6
and more and more people
47:15.6
begin that journey
47:16.5
and we see a movement
47:17.9
towards responsibility
47:19.7
over the environment.
47:21.5
And the conversation
47:22.6
for business here is,
47:24.5
is that those organizations
47:25.7
that are going to be known
47:26.7
to be a part of the solution
47:28.6
are going to gain
47:30.1
that competitive advantage.
47:31.8
Moving into a purpose economy
47:34.6
the competitive landscape
47:36.2
is going to be a part of the solution.
47:37.2
We'll be determined
47:38.2
by how much good you do in the world
47:40.0
over the product itself.
47:44.1
and we can even make more traction
47:46.4
by engaging and inviting
47:48.4
Filipino organizations
47:51.2
in being a part of the solution
47:52.7
and not the pollution.
47:57.1
Here's another one.
47:58.6
Reduce plastic use
47:59.7
and demand a 60% reduction.
48:03.5
in terms of production of plastics
48:07.0
What's on the agenda?
48:07.2
What's our scorecard on this?
48:09.5
Well, there's still a long way to go
48:10.8
considering that over 13, 14 trillion kilos
48:14.0
of plastic have ever been produced.
48:15.8
It's almost all still here on the planet.
48:18.3
And yes, we need to be reducing
48:19.7
the amount of virgin plastic.
48:22.0
Now, we're not going to enter an economy
48:23.8
where we don't have plastic.
48:25.4
I think it's a beautiful conversation
48:27.0
but it won't occur.
48:28.4
What we might be able to do
48:29.6
is reduce the amount of new plastic
48:31.4
that's being produced.
48:32.8
And we will make a commitment
48:34.0
to demand for it.
48:39.1
tell us about your latest initiatives
48:41.6
What are your targets for this year
48:42.8
and what have you been doing?
48:45.0
Well, we've collected
48:45.9
over 6 billion bottles,
48:48.1
the equivalent of collected by hand.
48:50.4
We're working around the world
48:55.1
into Cameroon and Thailand.
48:57.3
We continue to build
48:58.2
collection ecosystems
48:59.5
that bring banking,
49:00.9
financial inclusion,
49:03.3
to the world's emerging
49:04.2
using plastic as a currency.
49:06.5
More importantly,
49:07.0
for us this year,
49:08.4
it's about engaging
49:09.1
the Filipino community
49:10.2
and the business community
49:12.4
the extended producer
49:13.3
responsibility law
49:15.0
and creating a space
49:16.8
for everyone in the Philippines
49:17.9
to be responsible
49:18.8
for creating a country
49:21.1
that is responsible
49:22.3
for the oceans and its people.
49:24.0
And that's what's available
49:24.8
and that's what we're up to
49:26.1
and that's what we're committed to
49:27.4
and that's what we're going to do.
49:31.5
founder and CEO of Plastic Bank,
49:33.1
the best of luck on your mission.
49:34.5
Always a pleasure talking to you.
49:37.0
It's a pleasure speaking as well.
49:40.9
one pub in London
49:41.7
is seeing an unprecedented
49:42.9
surge in customers.
49:45.5
named one of her new songs
49:48.5
after the location.
49:51.2
was already revealed in March,
49:53.1
it was only last week
49:54.4
that it was confirmed.
49:55.8
Taylor was referring to the pub.
49:57.7
And there's only one thing to do
49:59.5
with Swift's Midas Touch,
50:01.7
which is to capitalize on it.
50:04.2
is riding on its newfound fame
50:06.1
with a song called
50:07.8
and Taylor's Version Cocktails.
50:12.2
It's obviously been so nice to see.
50:14.5
We're a very cozy,
50:15.6
small neighborhood pub.
50:17.2
So something like this happening
50:20.0
it's something that money can't buy
50:21.9
and we're just so thankful
50:24.5
because they've just been amazing.
50:25.9
We've had reports
50:26.8
of a certain blonde regular
50:28.1
but wouldn't want to give
50:33.3
I can neither confirm or deny
50:34.8
but I'm going to kind of confirm.
50:36.8
Now, like the pub,
50:38.5
Taylor's new album,
50:39.5
The Tortured Poets Department
50:40.8
is also breaking records,
50:42.7
becoming the most streamed album
50:45.7
on various platforms.
50:49.3
And that's it for the show.
50:50.8
I'm Stanley Palisada.
50:51.8
Thank you so much for watching.
50:52.8
You can listen to our interviews again
50:54.5
on the ANC Market Edge podcast
50:56.7
available on Spotify.
50:58.3
Stay safe and stay with ANC.
51:04.8
And we have allowed
51:06.6
more transportation to come out.
51:09.1
That's going to...
