Stocks jump 2.6%
The Philippine stock market on Tuesday jumped 2.62 percent after opening weaker in a display of optimism equities experts attributed to the fast, credible and peaceful national elections on Monday.
The benchmark Philippine Stock Exchange Index (PSEi) surged by 2.62 percent or 183.01 points, to close at 7,174.88, while the broader All Shares index likewise registered a gain of 2.62 percent or 109.18 points to end the trading day at 4,272.24.
Hans Sicat, PSE president and chief executive officer, expressed hope that the next president would continue to build on the advances and the success of the incumbent administration.
In addition, Sicat said he hopes that the Bangkok Sentral ng Pilipinas (BSP) may remain independent and operate in an autonomous and stable way despite the transition from incumbent to incoming administration, saying that the BSP is the “great pillar of support” to the country’s economy.
“On the economic front, all the [presidential]candidates seem to have economic advisers that are middle of the road and competent. May the next administration continue to choose competent economic advisers, whose advice the next President would heed,” he said.
“I think that is good for the country. I think the fear of some sectors is that some candidates did not articulate that very well. But all the candidates seemed willing to think of things in a pro-growth scenario,” he said.
Despite foreigners remaining net sellers at P697 million, the country’s main and sub-indices enjoyed substantial increases.
All the sub-indices saw gains, led mainly by the property sector jumping 3.48 percent and holding firms climbing 3.26 percent.
Total value turn over hit P8.785 billion from last week’s P5-billion average, with gainers outnumbering losers 133 to 50, while 47 issues were unchanged.
Justino Calaycay Jr., head of research and marketing at A&A Securities Inc., said that the national elections proved to be “anti-climactic,” and thus turned out to be a “pleasant surprise” for equity investors.
“After the heated exchanges over social media, and even through the mainstream, traditional channels, the exercise went by peacefully and orderly. The counting went with little hitch and the major contestants were quick to recognize the mandate of the people. This made the market upbeat,” Calaycay said.
He noted that the wide margin of victory of Mayor Rodrigo Duterte, which was apparent right from the start of the counting, settled the concerns circulating in social media about the alleged “Plan B” of the Aquino Administration.
“Against the backdrop of heavy exchanges of brickbats and negativity in social media fora, the sober reactions of the losing candidates as the numbers came out is a breath of fresh air” Calaycay noted.
He said that investors are now setting their sights on what Duterte’s plans and actions would be.
“It begins with his Cabinet appointments—especially the composition of his economic management team. This has been one gray area left unaddressed during the campaign, but it is the one important element for the market. It depends. If he can employ the best and the brightest minds, fears shouldn’t materialize,” he said.
Lastly, Jonathan Ravelas, chief market strategist at BDO Inc., said that the local stock market reacted positively to the quick results of the automated elections showing a clear mandate to the winner Duterte.
“This helped ease the fears. Clarity in his appointments to key posts, priorities of his administration and the timeline to achieve them would be key to win both local and foreign investors,” Ravelas said.