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| By Ian C. Sayson |
| Bloomberg |
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| PHILIPPINE stocks fell for a third day, dragging the key index to a two-month low. Jollibee Foods Corp. and Megaworld Corp. slid on concern rising government bond yields will drive banks' lending rates higher. "The possibility that borrowing costs will rise is adding to the cautiousness of investors," said Astro Philippine Long Distance Telephone Co. (PLDT) and its Pilipino Telephone Corp. (Piltel) unit declined after reporting lower earnings. Philex Mining Corp. gained after the company said its overseas sales rose in February, boosted by higher metals prices. The Philippine Stock Exchange index lost 24.61, or 0.8 percent, to 2,973.27 at the close, the lowest since January 11. The benchmark has tumbled 11 percent since February 27, when the biggest plunge in Chinese stocks in a decade triggered a selloff in global equities. The yield on the 91-day Treasury bill, which banks use to base their lending rates, Monday afternoon increased at a government auction for the first time in five months. The yield Thursday rose to 4.1 percent from 4.05 percent in secondary trading, according to data compiled by Bloomberg. Borrowing costs PHILIPPINE government bond yields are climbing because overseas investors are shifting money out of riskier emerging-market assets amid concern about the rout in global stocks, LandBank vice president Alex Macapagal said. Yields rose even after the government reported the slowest inflation in more than four years, prompting the central bank to say that this gives it more flexibility in setting interest rates. "The higher yield of the 91-day Treasury bill has a more immediate impact on borrowing costs then the possible cut in central bank rates as a result of lower inflation," said Ron Rodrigo, head of research at Unicapital Securities Inc. in Manila. Jollibee Foods, the nation's largest fast-food company, fell P1, or 2.1 percent, to P46.50, its lowest in more than two weeks, on speculation higher borrowing costs will damp consumer spending. Megaworld, a builder of residential and office towers, fell 5 centavos, or 1.9 percent, to P2.65. Lower Earnings PLDT, the nation's largest company by market value, lost P5, or 0.2 percent, to P2,345, extending a two-day, 2.9- percent slide. The company said earlier Tuesday that fourth-quarter profit fell 7.7 percent to P8.95 billion on higher taxes and lower currency gains. "Growth isn't as spectacular as in previous years, revenues have plateaued," said Jenny Ting, who helps manage about $4.7 billion at BPI Asset Management Inc. in Piltel, the nation's third-largest mobile phone company, declined 10 centavos, or 1.5 percent, to P6.50, its lowest since January 19. At the close of trading Monday, the company said its net income last year fell 25 percent on higher interest payments and lower currency gains. Philex Mining, the nation's most profitable copper and gold producer, advanced 10 centavos, or 2.7 percent, to P3.85, ending a two-day, 11-percent slump. The company exported P840 million of metals last month, up 2.6 percent from January, it said after Monday's market close. Filinvest Land Inc., the nation's largest builder of affordable homes, gained 4 centavos, or 2.7 percent, to P1.50, ending a seven-day, 24-percent decline. The Manila-based builder said Monday after trading ended that the Government of Singapore Investment Corp. sold 1.93 billion shares in the company on February 27. The shares, equivalent to 7.9 percent of the company, were valued at P3.51 billion based on the stock's last trading price on the date of the sale. Shares worth P5.04 billion were traded, 39 percent more than the six-month daily average. Losers outnumbered gainers 62 to 49, with 44 stocks unchanged in the broader market. The following stocks either rose or fell. Stock symbols are in brackets after company names. Universal Robina Corp. (URC PM), the largest snack-food maker in the C&P Homes Inc. (CMP PM), a Philippine builder, fell 2 centavos, or 0.9 percent, to P2.24, after rising as much as 6.2 percent earlier. The Philippine builder said at the close of trading Monday 90 percent of its bondholders accepted its proposal to repay $150 million of bonds that it sold 10 years ago with new bonds and shares. Fil-Estate Land Inc. (LND PM), a Philippine property developer, advanced 3 centavos, or 3.7 percent, to 85 centavos. The company said it borrowed $12.5 million from |
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