KFM Weekly Investment Update: Friday, 16 June 2017

Local Market Summary:

•The Minister for Apec, Justin Tkatchenko expressed that the construction
of the K120.0m APEC Haus will be completed by the end of July 2018 as
planned despite changes in the country’s future Government. He added
that the Apec Authority, which is an independent body of the Government
will start the proceedings after its completion in preparation for the summit
to commence by November 2018

•CEO of PNG Tourism Promotion Authority, Jerry Agus mentioned that the
World Bank approved a K64.0m tourism project which will be piloted in East
New Britain and Milne Bay Province. Tourism Industry has been providing
job and development opportunities over the past decade hence the project
will leverage the International Finance Corporations relationship with cruise
lines inbound operators with more inclusive travel packages

•Mr Wapu Sonk, Managing Director of Kumul Petroleum Holdings (KPHL)
announced the company’s purchase of 40.1% stake in the block Petroleum
Development License (PDL) 3 in Southern Highlands. He said that sale
agreement and ministerial clearance were finalized and that it was a back-to-
back deal with Petroleum Resources Gobe (one of MRDC’s subsidiary
company’s), who takes on 75.0% of the purchased equity

•Coca Cola Amatil PNG Ltd general manager, Somu Battacharya, has urged
business houses in Lae to remember the importance social-corporate
responsibility in their operating environments. Mr Battacharya said that
businesses are faced with a lot of environmental challenges in PNG, but as
a business, we ensure that we operate with consideration to this. He further
stated that this was the only way to safeguard the future of the environment

•The Minister for Public Enterprise and State Investment, Charles Abel
announced the appointment of Chey Scovell of PNG Manufactures Council
and Mark Chan as the new Board of Directors of PNG Power Limited

•Oil Search maintains positive outlook for 2017 despite low world oil prices
in 2016. According to Oil Search Chairman, Rick Lee, revealed that the
company’s operated fields performed well above expectation, contributing
6.8 million barrels of oil equivalent to the PNGLNG Project reassuring
shareholders that the company had entered 2017 with a strong operational
and financial position to deliver substantial value for its shareholders

•Kina Asset Management Limited announced an NTA of K1.27 for the month
ending 31 May 2017 with a closing price of K0.96 per share

•This week’s BPNG auctions in Central Bank Bills offered for 28 days was
under-subscribed by K47.0m of the total amount of K326.0m offered with a
weighted average yield of 1.25%

•This week’s BPNG auctions in Treasury Bills was under-subscribed by
K73.2m out of a total amount of K334.2m on offer. Weighted average yields
for terms 91 days,182 days, 273 days and 364 days were 2.50%, 4.72%
and 6.64% 7.92% respectively for the week

•The KSi Index has increased by 10.0% from the previous week to end at
5,365.54 points. The KSi Home Index rose 0.1% to conclude at 11,057.97
points, reflecting increase in share price of banking and financial stock BSP
and mining giant Newcrest Mining

International Market Summary:

•Australian shares fell on Thursday due to weak energy and basic material
stocks and also the overnight dip on Wall Street after US Federal Reserve
hiked interest rates. The Australian shares fell by 1.2% or 67.6 points to
close at 5,766.30.

•Asian stocks were mixed on Friday as a tech sell-off overnight shaded
sentiment among investors who continued to focus on central bank policies,
including Japan’s decision Friday to keep its ultra-lax monetary stance
intact. Japan’s Nikkei 225 stock index rose by 0.6 % to close at 19,940.56

•Major US benchmarks ended lower. The Standard & Poor’s 500 index lost
0.2 % to close at 2,432.46. The Dow Jones industrial average dipped 0.1
% to 21,359.90 after Wednesday’s record high close. The tech-heavy
Nasdaq composite dropped 0.5 % to 6,165.50.

•European stocks came to a lowest close on Thursday as investors
examined the monetary policy outlook for US Federal Reserve with signs
of consumer demand cropped up. Meanwhile the Germany’s DAX fell by
0.9% to end at 12,691.81 while France’s CAC declined 0.5% to end at

•PGK/USD remained unchanged for the week to close at 0.3145 while
PGK/AUD depreciated 0.7% to end at 0.4146 and AUD/USD escalating
0.7% to end the week at 0.7580

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pdfKFM Weekly Investment Update: Friday, 16th June 2017

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