Stocks advance on smaller rate hike hopes

pressure on equities.

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LOCAL stocks tracked a Wall Street rally on Friday after a top Federal Reserve official said he would back a small interest-rate hike at its next meeting but hinted at a possible summer pause to see how tighter policy has impacted inflation.

The PSE index, the 30-company benchmark, rose 32 points, or 0.50 percent, to close at 6,655.37 as five of the six subsectors advanced, with only the

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property shares losing value.

The broader index representing all shares also went up 15 points, or 0.43 percent, to settle at 3,564.42 on a value turnover of P6.48 billion. Gainers led losers, 84 to 73, while 52 issues were unchanged.

Seven of the 10 most active stocks ended in the green, led by Metro Pacific Investments Corp. which climbed 7.40 percent to P4.50 and Bank of the Philippine Islands which added 3.65 percent to finish at P107.90.

Meanwhile, the peso appreciated 0.35 percent to close at 54.82 against the US dollar Friday from 55.01 Thursday.

Asian markets also recovered Friday.

A strong run of data sent chills through

Ericsson to pay $207m for breach of US bribery deal

STOCKHOLM,

Sweden—Swedish

telecom equipment maker Ericsson has said it will pay a $207-million fine for breaching a deal with US authorities by not disclosing an investigation relating to suspected bribes to the Islamic State group in Iraq.

The company entered “a guilty plea regarding previously deferred charges relating to conduct prior to 2017,” for not disclosing an internal 2019 investigation relating under a 2019 Deferred Prosecution Agreement, it said in a statement late Thursday.

“The entry of the plea agreement will bring the 2019 DPA to an end,” the company said of the 195 million euro fine.

The Swedish company had already announced in January that it had earmarked 2.3 billion kronor ($220 million) to cover potential fines over the issue, which would be booked in the fourth quarter of 2022.

It had already agreed in 2019 to pay $1 billion in penalties to US authorities to close corruption cases in Djibouti, China, Vietnam, Indonesia, and Kuwait.

Ericsson said it had entered the deferred prosecution agreement “to resolve previously disclosed Foreign Corrupt Practices Act [FCPA] violations relating to conduct in several countries between 2010 and 2016.”

The company said that since its deal the US Department of Justice (DOJ) had “not alleged or charged” Ericsson with any new criminal conduct, and said the new fine related only to a failure to disclose documents to the DOJ in a timely manner.

“This resolution is a stark reminder of the historical misconduct that led to the DPA. We have learned from that and we are on an important journey to transform our culture,” Ericsson’s chief executive Borje Ekholm said in the statement. AFP trading floors in February -- wiping out almost all January’s rally—as investors realized the US central bank had more work to do to control prices.

The unease largely overshadowed optimism about China’s recovery after officials ended three years of strict zeroCovid containment measures that battered the world’s number two economy.

Several Fed policymakers have lined up this year to insist that while inflation is coming down, they remain determined to keep hiking rates until they hit their two percent target.

The latest indicators have led investors to bet on rates hitting a peak of 5.5 percent, though six percent has also been mooted, putting further downward

UAE’s ADNOC Gas to raise $2.5b from biggest IPO in 2023

DUBAI, United Arab Emirates—

The UAE’s state oil giant ADNOC said it will raise about $2.5 billion in a flotation of its gas business—the world’s biggest IPO this year—as it announced final pricing on Friday.

The ADNOC Gas offering was set at 2.37 dirhams ($0.65) per share, towards the top of its range, implying a market capitalization of about $50 billion, the company said in a statement.

Total demand topped $124 billion, making it more than 50 times oversubscribed, ADNOC added, calling it the biggest demand yet seen for an initial public offering in the Middle East and North Africa.

The offer was expanded from 4.0 percent to 5.0 percent this week in reaction to demand.

ADNOC Gas, hived off from the Abu Dhabi National Oil Company (ADNOC) at the start of this year, is expected to start trading on the UAE capital’s stock exchange on March 13.

“ADNOC is delighted with the unprecedented demand for ADNOC Gas shares from UAE retail investors as well as the local and global institutional investor community,” ADNOC Group CEO Khaled Al Zaabi said in the statement.

ADNOC, one of the world’s largest oil producers and the Gulf monarchy’s key revenue earner, will retain a 90 percent stake in the subsidiary formed from its former gas processing, LNG, and industrial gas units.

The rapid turnaround of the ADNOC Gas IPO follows increased activity in the market following Russia’s invasion of Ukraine, which sent European countries scrambling to find alternative suppliers.

Gas is also being touted as a cleaner fuel as countries around the world strive to reduce their emissions in an attempt to contain global warming.

“The strong demand for the IPO reflects a number of factors, including the important role that gas will play globally as a cleaner transition fuel and the strong demand outlook from Europe,” Monika Malek, chief economist at UAE bank ADCB, told AFP. AFP

However, while talk has been swirling that the central bank could hike rates by 50 basis points at its March meeting, traders were given some much-needed hope by Atlanta Fed chief Raphael Bostic, who said he favored a 25-point move.

He also questioned whether it should go much higher than 5.25 percent from the current 4.5-4.75 percent. That would allow the bank to pause its tightening in the summer.

“I let the data guide me,” he said. “If the data continue to come in suggesting the economy is stronger than I had projected, I’ll adjust my policy trajectory.” With AFP

China setting lowest growth target in years

BEIJING—China will likely set one of the country’s lowest growth goals in decades at the annual National People’s Congress next week, experts told AFP, hit by long-running property woes, a sluggish global economy, and geopolitical tensions.

Thousands of party delegates from across China will converge in Beijing for a rubber stamp conclave set to confirm key personnel appointments and make policy for the coming year.

Among the first declarations is expected to be a target for gross domestic product growth over the coming 12 months, announced by outgoing Premier Li Keqiang at Sunday’s opening ceremony.

Last year, the economy expanded just three percent, one of its weakest in decades on the back of the Covid-19 pandemic, lockdowns, and a real estate crisis.

And economists surveyed by AFP predicted goals for 2023 will be conservative, expecting policymakers to aim for 5.3 percent, one of the lowest targets in decades.

China’s housing market, which along with construction accounts for more than a quarter of GDP, remains in a slump, having been dealt a hefty blow since Beijing started cracking down on excessive borrowing and rampant speculation in 2020.

Real estate sales have since fallen in multiple cities and several developers are struggling to survive, while many homebuyers last year refused to pay mortgages on incomplete properties.

“Sales, commencements, and prices are all lower,” Moody’s economist Harry Murphy Cruise said.

“Property developer defaults in late 2021 left more than a million pre-sold homes unfinished, spooking households, and prompting many to turn their back on the market.” AFP