KFM Weekly Investment Update: Friday, 31 March 2017

Local Market Summary
• Prime Minister Hon. Peter O’Neill announced the appointment of Sir Moi Avei as the chairman and director of Kumul Petroleum Holdings (KPHL) replacing Mr Frank Kramer through a decision made by the National Executive Council. PM O’Neil acknowledged Mr Kramer for leading the early stages of KPHL’s development in the oil and gas sector of PNG. He added that now with Sir Moi having the leadership and experience as the minister for Petroleum, KPHL is in a course for development to the next level
• Minister for Trade, Commerce and Industry, Hon. Richard Maru, has confirmed that the Fiji Government has up lifted the ban on PNG products like Ox & Palm and rice. Hon. Maru received an official letter from Fiji’s Trade Minister that confirmed Fiji had lifted the ban on imports from PNG goods. Hon. Maru stated that it had been a long battle but was thankful the Fiji government had responded positively
• Moreover, Hon. Maru said that it is incumbent on the new trade minister of PNG to pursue the issue on trade with the Philippines regarding the lopsided trade difference they have and that he cannot start this now as he term is almost up. He stressed that Philippines is a country that PNG seriously needs to negotiate a corporate economic agreement with
• A multimillion power energy company called Shenzen Energy of China has been engaged in the Ramu 2 hydro power plant project. The project’s total capacity is 180megwatts which accounts for 33.0% of PNG’s total installed capacity. After the project’s accomplishment, power will be supplied to Momase and the Highlands region. Shenzen Energy will be working in consultation with Sino Hydro Company
• Nambawan Super’s (NSL) Acting MD Mr Vere Arava revealed during the super funds employer conference that NSL was in discussions with the government to give state owned entities shares to NSL in order to reduce the unfunded liability owed by the government
• The Port Moresby Stock Exchange’s (POMSoX) Director Mr Johnson Kalo announced that Ms Karen Aisoli will be replacing Mr Vincent Ivosa as the General Manager GM). The Board expects to formalize shortly the appointment of Ms. Aisoli to the role of GM and will advise accordingly
• Total E&P a partner in the LNG Project has expressed appreciation towards its other partner ExxonMobil. Total E&P conveyed its confidence over their collaboration in petroleum retention license 17 (PRL 15) which hosts the Elk-Antelope fields describing it as a good thing for the project. Total E&P’s MD Mr Phillipe Blanchard said the American energy giant was a huge player in the LNG business and this would give confidence to buyers in the world’s LNG market to buy gas being produced from PNG
• Meanwhile, MD to ExxonMobil Mr Andrew Barry said ExxonMobil will continue to invest in the country and is keen to work with the Government after the elections to see more successful results for PNG LNG projects. Mr Barry highlighted that ExxonMobil has changed so much in the last five years and have so many opportunities lying ahead
• Credit Corporation (CCP) recorded an operating profit after tax of K98.9m. The Group’s total assets reached K1, 249.2m in 2016 which was a moderate decrease from K1, 260.7m in 2015. Total shareholdings’ equity at year end was K787.3m an increase of K19.8m from 2015. Despite being a difficult year, CCP achieved solid results
• This week’s BPNG auctions in Central Banks Bills were offered for 28 days and 63 days with an over subscription of K75.0m out of a total of K856.0m on offer. The weighted average yield was 1.20% and 2.34% respectively
• This week’s BPNG auctions in Treasury Bills were oversubscribed by K110.6m out of a total of K348.7m on offer. Weighted average yields for 182 days and 364 days were 4.73% and 7.82% respectively
• The KSi Index ended the week slightly up by 0.1% to close at 5,487.92 points. The KSi Home Index was also up by 0.8% reflecting an increased in banking stock Bank of South Pacific (BSP) up 1.0% to K9.40, ending at 11,069.10 points
International Market Summary
• US stocks closed higher as financial shares rallied following a positive reading of economic growth to finish in territory after a month-long wait. The Dow Jones Industrial Average finished at 20,728.49 points up 0.6% for the week, the S&P 500 ended at 2,368.06 points up 1.0% and the Nasdaq finished at 5,914.34 points up 1.5%
• Asian stocks were mixed by week-end after positive news out of the US and Chinese factory data was positive. Japanese stocks rose as upbeat industrial production data and a weak yen supported sentiment as the Nikkei share average ended the week with 18,909.26 points
• The Australian stock market broke its winning streak after a heavy sell-off and still posted the best weekly gains of the year. However, most sectors experienced negative results. The ASX 200 ended the week with 5,864.91 points
• Oil prices ended lower on Friday at $US 52.64 per barrel but higher by 3.6% for the week as traders took profits following three days of gains on expectations that OPEC-led crude supply cut would be extended. Light crude (WTI) was also up by 4.4% at $50.07 per barrel
• PGK/USD remained flat for the week to close at 0.3145, PGK/AUD depreciated by 0.3% to end at 0.4113, while AUD/USD appreciated by 0.3% to end the week at 0.7647
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KFM Weekly Investment Update: Friday, 31 March 2017