Philippine shares bounce back to positive territory


The local stock market bucked the sideways trend on Thursday and bounced back to the green side after some positive economic developments turned up.

“After days of lethargic trades, local investors appeared on the buy side on a rather belated appreciation of recent positive developments,” Jun Calaycay, Accord Capital Equities Corp. analyst, said.

The International Monetary Fund (IMF) lifted its growth outlook for the Philippines the other day, citing that the economic fundamentals of the country remain buoyant.

Calaycay said, however, that investor sentiment is still very fragile at this point, easily swayed by daily developments and news from overseas.

“This highlights the fundamental problem the domestic equity market faces—the scarce leads from the macro-front and very little appreciation for long-term propositions,” he said.

“Retail investors are more attuned to searching for trades that promise a short-term upside potential, the steeper the prospective price advance, the more interested the market becomes,” Calaycay added.

Philippine Stock Exchange index ended Thursday’s session with a slight gain, inching up a bit by 1.57 percent, or 99.18 points to 6,407.36, while the wider all-shares index advanced by 1.58 percent, or 60.95 points to close at 3,919.60.

The sectoral indices reversed their early losses with property rising significantly by 2.69 percent, or 65.19 points to 2,490.02, and industrial advancing 2.15 percent, or 205.19 points to close at 9,756.11.

Mining and oil also posted a somehow hefty increase, gaining 1.94 percent, or 270.74 to 14,204.85, followed by services which increase by 1.55 percent, or 29.13 points to end at 1,913.57.

Holding firms, meanwhile, improved by 1.20 percent, or 68.74 points to 5,820.55, while financials moved up a bit by 0.69 percent, or 11.03 points to 1,600.48.

Value turnover also picked up to over P7.15 billion with gainers routing decliners, 106 to 40, while 43 issues unchanged. Overall, the market is expected to remain lethargic as most investors take cue from overseas developments.

“From this standpoint, a positive bias should begin to level, as concerns have apparently eased or at least have become less intense than in the recent period of ‘scare,’” Calaycay explained.

“A rational market should see the index attempt to break past the 6,500-level, particularly as the domestic earnings season rolls in. Obviously, the push will come from increased interest in index components as well as a good number of second-line growth counters,” he further said.


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