PSE [PSE 161.20 ?2.9%; 38% avgVol] [link] adjusted the PSE MidCap and DivY indices. For the MidCap, Ginebra San Miguel [GSMI 159.00 ?0.7%; 296% avgVol] and Philippine National Bank [PNB 18.52 ?0.1%; 9% avgVol] are in, and AyalaLand Logistics [ALLHC 2.25 ?2.2%; 95% avgVol] and Petron [PCOR 3.70 unch; 115% avgVol] are out. For DivY, Figaro [FCG 0.76 ?1.3%; 56% avgVol] is in, and Citicore Energy REIT [CREIT 2.55 unch; 119% avgVol] is out. There were plenty of changes to the sectoral indices, and you can see all those in the link provided.
MB Quick Take: I’ve had several readers reach out to me to do an analysis of the stocks that might get added or deleted from the PSE’s curated indices, but I honestly have no idea what criteria the PSE uses to make these decisions, or what these decisions could mean for stocks that are promoted or relegated. If anyone out there has a good understanding of how this works and is willing to share, please reach out so that I can share the knowledge with everyone through some kind of special episode!
Anti-Red Tape Authority (ARTA) [link] had five of its officials, including its former director general, dismissed by the Office of the Ombudsman for “grave misconduct” when they improperly favored Now Telecom [NOW 1.27 ?3.0%; 92% avgVol], owned by Mel Velarde, in the assignment of new frequencies back in 2021, when ARTA then took the strange step of directing the National Telecommunications Commission to act on the ARTA’s own “order of automatic approval” of NOW’s bid for the frequencies. The Ombudsman was acting based on a complaint by Dito Telecommunity [DITO 2.31 ?2.5%; 45% avgVol].
MB Quick Take: A rare “W” for DITO! It takes two to tango, so I’m waiting to see what will happen to NOW and the frequencies that it obtained through that original ARTA order. Knowing what I know about how these things work, I sincerely doubt that ARTA acted as it did out of its own benevolent wish to see NOW elevated to “major telco” status. This news sure makes Mr. Velarde’s recent quotes about “leveling the playing field” with its competitors thanks to the “right government support” all the more interesting/hilarious.
US Federal Reserve (the “Fed”) [link] said that it doesn’t expect US inflation to fall back down to 2% “until about 2025”, with Jerome Powell going so far as to say that the Fed would not be cutting rates this year. Mr. Powell did say that the Fed would not be raising rates all the way until inflation was down to 2%, that it would likely stop raising rates when it was able to see credible evidence of slowing inflation and that it would likely even be cutting rates before inflation actually got down to the 2% level.
MB Quick Take: I don’t intend to cover every comment that a central banker makes about inflation, but I think this one in particular is helpful because it loosely outlines how the Fed is expecting things to go in the medium term, and provides a “hotel tourism map” to how the Fed feels it will act over the next couple of years. We can use this as a way to keep score on how the process is going, and if we see divergence, we can start to dig a little deeper and see what projections might be at risk.
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