News
MANILA: In its Regional Market Outlook for the second half of the year, Singapore’s DBS Bank maintained its 6,900 year end target for the benchmark Philippine Stock Exchange Index (PSEi). “Key factors that weighed down the Philippine equities market in the last 24 months have turned favorable,” DBS said in its report. The target is still based on a projected equity risk premium of 490 basis points, implying that investors are cautious about buying stocks at a high price amid lingering risks. But in opting to maintain its index outlook, DBS said inflation in the Philippines had “eased meaningfully,” while the peso also managed to regain its strength against the US dollar. Inflation cooled to a five-year low of 1.3 percent in May from 1.4 percent in April due to lower utility costs. Strong peso Meanwhile, the local currency improved to 55.62 (RM4.22) against the greenback on Friday from 55.77 (RM4.23) on Thursday. Japan’s MUFG Bank also anticipates the peso to appreciate to 54.50 (RM4.14) against the US dollar by the first quarter of 2026. With these factors in play, DBS pointed out that the Bangko Sentral ng Pilipinas now had more room to cut rates. “We believe these developments set the stage for a constructive Philippine equity backdrop in [the second half of 2025],” DBS said. It likewise noted that the Philippines had the best economic growth outlook in the region at 5.8 percent this year, versus Singapore’s 2 percent, Thailand’s 1.8 percent and Indonesia’s 4.8 percent. Adding to this optimistic outlook is the fact that the Philippines was less reliant on trade for economic growth compared with its peers, DBS explained. Thailand’s economy, for example, was the most export-driven, making it the least attractive market for investors. Once US President Trump’s 90-day tariff truce ends on July 31, the Philippines will be one of the countries to see the weakest impact. Semiconductors, electronics assembly and agricultural products were among the main goods it exported to the United States last year. These resulted in a net export surplus of RM22.47 billion ($5.3 billion), representing 1.2 percent of the Philippines’ gross domestic product. This surplus means that the Philippines exported more products to the United States than it imported, earning for it an original tariff of 17 percent that had also been paused. Semiconductors Still, DBS said, “We note that the impact may be even less significant, as semiconductors—its key export—remain exempt from proposed tariff measures.” Earnings outlook for companies in the benchmark PSEi also remained intact at 11 percent this year and 7 percent in 2026, mainly because their revenue drivers still came from domestic operations. “Key sectors—such as banks, utilities, property and conglomerates—are largely shielded from external trade shocks, further supporting resilient earnings trajectory despite elevated global uncertainty,” DBS said.
2 d ago
Opinion
A month ago, Tengku Zafrul Aziz was warmly welcomed by the sports fraternity into their fold. On May 10, the corporate man turned rising political star was appointed the new president of the Badminton Association of Malaysia (BAM) for the 2025-2029 term. As a badminton fan, I also welcome Zafrul to play a more prominent role in Malaysian badminton. Why not, if a person of his stature is prepared to spend his time and resources to help develop our national sport! This past week, Zafrul has been hogging the limelight for a different reason, politics to be more precise. Not surprisingly, his decision to leave Umno for PKR is much more controversial than his appointment as the head of a sports association. Unlike the BAM appointment, not everyone is happy with his latest political move. His detractors have called him names, including the demeaning “political tourist” while his supporters said he would give “added value” to PKR, given his background and experience. As for me, being a keen political observer, I don’t think it would do the nation any good if certain politicians are placed on a high pedestal of indispensability or invincibility. At the moment, I don’t think there is any exceptional or extraordinary Malaysian politician deserving of the “statesman” status. None. Not any of our former prime ministers or the current one. There are no statesmen in Malaysia, as far as I’m concerned, only career politicians. Take that in with a pinch of salt, if you must. When someone is described as a political rising star, it is either because he is ‘blessed’ with strong cables and ascended the political ladder unusually quick, or he is regularly mired in controversy, positive or negative, good or bad. Zafrul is in that awkward situation today. His announcement that he has left Umno to join Prime Minister Anwar Ibrahim’s PKR has ignited significant controversy within the nation’s political landscape. This development has stirred tensions within the unity government coalition, highlighting underlying issues of party loyalty, internal dynamics and strategic maneuvering. Already, several Umno leaders have called for his resignation from the cabinet. They have also reminded the prime minister that Zafrul’s post as the minister of investment, trade and industry is an Umno quota and that it must be returned to the party. The many salvos from Umno against Zafrul were not unexpected given the minister’s strained relations within Umno. Zafrul’s relationship with Umno has been fraught with challenges. Following Umno’s poor performance in the 2023 Selangor state elections, where the party secured only two out of 12 contested seats, Zafrul resigned as the state chapter’s treasurer in April 2024, citing dissatisfaction with the party’s revival efforts. Sources suggest that internal power struggles and fears of being overshadowed led certain Umno leaders to sideline him, exacerbating tensions and prompting him to explore opportunities elsewhere. Umno has been very vocal about party-hopping of late, probably because the party is in a vulnerable state. No surprise that it has expressed strong objections to […]
4 d ago
