Philippine shares bounced back on Tuesday, recovering from a one-day correction, after Wall Street’s record gains overnight spurred buying of local equities.
Good first-quarter earnings and the sovereign credit rating upgrade received by the Philippines from Standard & Poor’s last week also added to the upbeat mood.
On Tuesday, the Philippine Stock Exchange index (PSEi) gained 41.47 points or 0.61 percent to 6,852.81, while the wider all shares went up by 30.35 points or 0.74 percent to 4,135.98.
“Investors cheered an overnight advance in the US equities, pushing the index to its highest level in a year—with the intra-day high falling a few points short of the June 10, 2013 close at 6,875.60,” said Justino Calaycay, analyst at Accord Capital Equities Corp.
Overseas, the Dow Jones hit a fresh record, reflecting a resurgence of confidence in the world’s largest economy, while expectations that China’s leaders will keep an accommodative stance amid weak economic numbers provided added lift to markets, Calaycay cited.
Except for financials, which shed 4.18 points or 0.26 percent to 1,613.53, most of the PSE’s sectoral indices ended in the green alongside the main index.
Mining and oil posted the largest advance, gaining 256.08 points or 1.56 percent to 16,659.40, followed by holding firms, which added 63.88 points or 1.03 percent to 6,275.33.
Properties came next, increasing 25.46 points or 0.94 percent to 2,732.68, while industrials rose 63.13 points or 0.61 percent to 10,339.94. Services gained 8.73 points or 0.43 percent to 2,060.27.
Trading volume on Tuesday rose to 1.8 billion shares valued at P9.7 billion.
Some of the most actively traded stocks were Puregold Price Club Inc., up 4.35 percent at P48.00; Philippine Long Distance Telephone Co., down 0.28 percent at P2,894.00; Ayala Land, Inc., up 0.79 percent at P32.00; and Alliance Global Group Inc., down 1.97 percent at P29.80.
Asked what could have prompted the sharp rise in Puregold shares, Puregold president Leonardo Dayao said he did not know why. Puregold conducted its annual stockholders meeting yesterday.
“Puregold led the actives list in early trades, adding P2 or 4.35 percent to P48. The Company is slated to report its first quarter numbers by Thursday, May 15th,” Calaycay said.
“Boosted by acquisitions last year, PGOLD posted net profits of nearly P4.0 billion or P1.43 per share against the P1.11 earned in 2012. This growth momentum should carry into and show in the first three months’ numbers, particularly with fresh period contributions from new acquisitions,” he added.
Philippine shares closed lower on Monday on profit-taking after several days of gains, driven further at the end of last week by S&P’s sovereign credit rating upgrade on the Philippines.
The PSEi ended Monday down 35.92 points or 0.52 percent at 6,811.34, while the wider all shares lost 10.43 points or 0.25 percent to 4,105.63.