Saturday, 30 May 2009

Investors still bullish about Philippine economy

Index surges to 2,389.31
Kristine Jane R. Liu

Share prices rose yesterday, boosted by Wall Street’s rebound and the usual month-end window dressing.

The benchmark Philippine Stock Exchange index gained 1.48% or 34.94 points to 2,389.31, while the all-shares index climbed by 2.47% or 37.91 points to 1,567.87.

A total of 4.43 billion shares worth P3.97 billion were traded, with foreign buyers edging out sellers with P175 million.

Advancers swept decliners 76 to 36 while 48 shares did not move.

Jeng T. Calma of A&A Securities, Inc. said the usual window dressing pushed up prices. It also helped that US stocks rallied on Thursday.

The 0.4% gross domestic product (GDP) growth in the first quarter did not discourage local and foreign investors, she said, who were already bullish about the economy.

And while investors already priced in a 25-basis point cut in the central bank’s key rates last Thursday, it was still welcome news.

The central bank slashed rates by 25 basis points late afternoon on Thursday, bring down its overnight borrowing rate to a new 17-year low of 4.25%.

Astro C. del Castillo of First Grade Holdings, Inc. said investors were focused on individual companies with good value, pushing up the prices of select issues.

He warned, however, that investors might do a reality check in the coming days due to the first quarter GDP data and the possibility of the country falling into recession.

Wall Street rallied on Thursday, pulled up by energy stocks that rose on rising oil prices and by easing bond yields. Rising bond yields the day before had raised worries over borrowing costs.

The Dow Jones industrial average climbed by 1.25% or 103.78 points to 8,403.80, while the Standard & Poor’s 500 index added 1.54% or 13.77 points to 906.83. The Nasdaq composite index gained 1.20% or 20.71 points to 1,751.79.

At home, holding firms shot up by 6.27% or 83.21 points to 1,409.69.

Property stocks added 2.74% or 22.14 points to 829.74 while industrial shares gained 0.99% or 31.02 points to 3,163.20.

Financial companies rose by 0.97% or 5.54 points to 571.19 while mining and oil stocks advanced by 0.02% or 1.33 points to 5,493.90.

The service sector, however, lost 0.28% or 3.60 points to 1,261.42.

Most blue chips rallied, with Pangilinan-led Metro Pacific Investments Corp. surging by 27% or P1.35% to P6.20 following the company’s announcement on Thursday it will sell new shares to the public.

Sy-led holding firm SM Investments Corp. jumped by 14.52% or P42.50 to P335, while Manila Electric Co. shot up by 7.47% or P8 to P115.

Ayala Land, Inc. gained 3.57% or P0.30 to P8.70, while Sy-led Banco de Oro Unibank, Inc. rallied by 1.53% or P0.50 to P33.

Ayala-led Bank of the Philippine Islands, however, lost 1.12% or P0.50 to P44 along with index heavyweight Philippine Long Distance Telephone Co., which shed 0.67% or P15 to P2,210.

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