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By Katrina Mennen A. Valdez, Reporter
WITH its profit likely to suffer this year due to the ongoing market
turmoil, the Philippine Stock Exchange (PSE) has decided to extend
trading hours into the afternoon in hopes of increasing liquidity.
Several years ago, the local bourse also
attempted to extend trading hours, but dropped the extension after
eight months due to low volumes.
Under its board-approved plan, the PSE will
extend trading next year, starting at 2 p.m. and ending 4 p.m. with
a 10-minute run-off period from 3:50 p.m. to 4 p.m. In between the
morning and afternoon sessions, the PSE will observe a two-hour
break starting 12 noon. The morning trading session runs from 9 a.m.
to 12 noon.
Francis Lim, PSE president and chief executive
officer, said the board also decided that the afternoon session will
be conducted through off-floor trading.
“The decision of our board to extend the
trading is part of a coordinated strategy to level our Exchange with
its peers in the region and develop our local stock market to its
full potential,” he said.
Lim said the bourse’s move is also aimed at
addressing foreign investors’ concern over the local Exchange’s
short trading session. “[They] first look at the bigger markets in
the morning but by the time they get the opportunity to look at our
market, the PSE is already closing, so why bother at all,” he
said.
The PSE president said foreign investors don’t
bother entering the local bourse at all since they can’t respond
to developments in the afternoon.
“The afternoon trading session is also aimed
at preparing the PSE to take full advantage of market-friendly
legislations that are now being put in place by the government like
the Personal Equity Retirement Account [PERA] Law, “ Lim said.
The PERA Law, which President Arroyo signed
recently, gives tax incentives to people who invest in the stock
market.
“With the extended trading hours, overseas
Filipino workers in the Middle East can now catch [our] market live
through our online brokers, thus they can invest in [our] market
with special incentives they will get from the newly-enacted PERA
Law,” Lim said.
He said that one overseas Filipino working in
Abu Dhabi has complained that he has to wake up at 5 a.m. just to
trade in the Philippines since the PSE is open only up to 12 noon.
“With the special incentives for them under
the PERA Law and afternoon trading hours, we hope to tap overseas
Filipinos as active players in our stock market,” Lim said.
“Extending our trading hours will open our
stock market to more investments by creating an overlapping link in
trading hours with other exchanges,” he added.
The PSE president said Asian investors will find
the overlap advantageous because the afternoon session will allow
them to catch the trading hours not only of markets in Asia, but
also in Europe, such as Euronext, Deutsche Boerse, OMX, Bolsa de
Madrid, and the London Stock Exchange.
“Times have changed. We have to consider also
that markets are much different now as trading has become more
global. However, [we] decided to implement the extended trading
hours next year to give the PSE market players enough time to make
necessary adjustments in their operations,” Lim said.
“The implementation of the extended trading
hours will coincide with our timetable in commissioning our new
trading system, which is tentatively scheduled to go live on or
before June 30,” he added.
On Thursday, share prices closed 0.3 percent
higher despite official figures showing slowing economic growth,
with investors cheered by Wall Street gains, brokers said.
The composite index put on 9.5 points to close
at 2,655.75. The all-share index rose 0.4 percent, or 6.80 points,
to close at 1,646.60.
A total of 1.4 billion shares worth P1.86
billion were traded. Gainers led losers 49 to 40, while 57 stocks
closed unchanged.
“The market was turning weaker towards the
close after the release of the GDP [data],” First Grade Holdings
analyst Astro del Castillo told Dow Jones Newswires.
The Dow Jones Industrial Average in the US rose
89.64 points to close at 11,502.21 Wednesday.
The Philippine government on Thursday said
economic growth slowed to 4.6 percent in the three months to June,
hit by soaring inflation and a global economic downturn.
Metropolitan Bank and Trust Co. rose 1.4
percent at P37.50 while the Bank of Philippine Islands added 2.2
percent at P46.
Philippine Long Distance Telephone Co.
shares were steady at P2, 675. A shares of San Miguel Corp. were
steady at P44.50 while B shares dropped 1.1 percent to P45.50.
--With AFP
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