PHILIPPINE shares ended four days of losses on Tuesday after a rally on Wall Street overnight lifted sentiment and sparked bargain hunting in local stocks.
Abbygayle Estrella, analyst at AB Capital Securities Inc., said the market snapped out of a four-day decline on strong gains from Wall Street overnight.
“Somewhat growing tired and weary of poring over recent risk factors and discounting these into share prices, markets turned [their]focus on corporate, particularly on M&A [merger and acquisition]activity. This provided a decent lift to share prices in the US and Europe overnight,” Accord Capital Equities Corp. analyst Justino Calaycay said.
Calaycay was referring to Pfizer’s planned $100 billion takeover of its British rival AstraZeneca.
“In turn, this gave local investors, as well as [those]in the broader Asian region, a reason to snap out of an extended decline,” he added.
The Philippine Stock Exchange index (PSEi) came out of its four-day losing streak on Tuesday, rising 32.10 points or 0.49 percent to 6,636.45, while the broader all shares rose 19.84 points or 0.50 percent to 4,010.04.
For his part, BDO Capital and Investment Corp. president Eduardo Francisco described the rebound as a “technical bounce” after a four-day correction.
All the sectoral indices managed to eke out modest gains.
The property sector posted the biggest advance, rising 19.85 points or 0.78 percent to 2,580.76, followed by industrials, which climbed 75.21 points or 0.76 percent to 9,993.80.
Services also expanded 12.04 points or 0.60 percent to end at 2,010.00, while holding firms gained 22.47 points or 0.37 percent to 6,077.79. Mining and oil added 12.04 points or 0.8 percent to 15,490.78, followed by financials, which inched up 1.27 points or 0.08 percent to close at 1,569.13.
Estrella noted a lack of interest in banking stocks after two of the largest listed banks, BDO Unibank Inc. and Bank of the Philippine Islands, reported significantly lower earnings for the first quarter of the year.
“In the last few days, banks have shown weakness in earnings on a lack of trading gains,” she said.
Trading volume was thin at only at 710 million shares worth P6.5 billion. Advancers outpaced decliners 104 to 63, with 50 issues unchanged.
Some of the actively traded stocks on Tuesday were Ayala Corp., up 0.73 percent at P618.50; Alliance Global Group Inc., up 0.16 percent at P30.65 points; Universal Robina Corp., down 0.28 percent at P145; and Metropolitan Bank and Trust Co., up by just 0.06 percent at P82.55.
Estrella said trade in the coming days will likely be dictated by first-quarter earnings results.
The Philippine stock market traded lower on Monday, reflecting sentiment on Wall Street rather than any optimism for improved trade ties with the United States despite the arrival of President Barack Obama for a two-day state visit.
With sentiment dampened by Wall Street’s losses on Friday, the benchmark index retreated on Monday, falling by 80.75 points or 1.09 percent to 6,604.35, while the broader all shares fell 43.96 points or 1.09 percent to 3,990.20.