The PHILIPPINE stock market rebounded by more than 1 percent on Thursday after the House of Representatives approved on third and final reading the government’s tax reform package, fueling the investing public’s optimism.
The bellwether index rose 90.37 points, or 1.15 percent to finish at 7,927.49. The wider All Shares barometer surged by 0.96 percent or 44.82 points to settle at 4,730.32.
“Philippine markets kicked off June on an optimistic note as buying continued with accompanying volumes. It was taken as a positive sign that the House of Representatives on Wednesday passed on the third and final reading of the tax reform bill, which would help add a further P82 billion in tax collection and aid in the ambitious infrastructure spending of the Duterte administration,” Regina Capital Corporation Managing Director Luis Limlingan said.
“Further propelling funds to buy was today’s release of the [Purchasing Managers’ Index] PMI data, which showed the country still in expansionary state with a reading of 54.3 for the month of May,” he added.
The IHS Markit reported on Thursday growth in the Purchasing Managers’ Index remained above the 50 level, signaling a strong improvement in the manufacturing sector.
“With this showing, the Philippines’ manufacturing sector remained firmly in expansion territory during May, underpinned by robust output growth and new orders,” Limlingan said.
Harry Liu, Summit Securities Inc. president, said the market responded a little bit positive from the passage of the tax reform bill.
“I think the investing public is feeling that the tax reform will definitely be applied,” he said.
Asked how long the market will remain optimistic, Liu said: “As long as we don’t break the resistance [level of 8,000], you can be assured that there’s no new news that will excite the market that will break that technical resistance. So you need more positive news than what we have today.”
Nearly all sectoral indices posted gains, led by Services (up 3.10 percent), Property (up 1.24 percent), Financials (up 0.90 percent), Industrial (up 0.74 percent), and Holding Firms (up 0.65 percent). Only the Mining and Oil index was in the red, declining by 0.51 percent.
More than 1.49 billion shares were traded, valued at almost P11 billion. Advancers outnumbered losers, 127-82, while 49 issues kept unchanged.
Among the most actively traded issues, Wilcon Depot Inc. soared 7.83 percent, Jollibee Foods Corporation rose 5.57 percent, PLDT grew 5.09 percent, Ayala Land Inc. surged 2.92 percent, and SM Investments Corporation was up 1.75 percent.