The State of the Nation Address (SONA) of President Benigno Aquino 3rd helped influence the local stock index to breach the 6,700-point barrier anew.
There was also a massive “buying interest” on Manila Electric Co. (Meralco) and Metro Pacific Investments Corp. (MPIC) shares that raised Monday’s trading activity.
“For the SONA, the President has outlined things to do that will eventually improve the economic condition,” said Harry Liu, president of Summit Securities Inc.
He said that foreign stock markets, particularly in the United States, Japan and China, and the “stabilizing the global market” helped fuel the rebound.
“The foreign markets, US, Japan, China—they are all looking toward an improvement to do all they can do to improve the economy. [Such as] the recent election of [Shinzo] Abe of Japan and [US Federal Reserve Chairman Ben] Bernanke’s gratifying his stimulus of formula,” Liu said.
Astro del Castillo, First Grade Finance managing director, said that the “transactions” and “buying interest” in Meralco and MPIC shares also contributed to the upward movement of Tuesday’s market session.
The positive SONA outlook may also influence the market, “breaking into 6,800 to 7,000 area, with the medium term needing to consolidate and correct after,” he added.
The Philippine Stock Exchange index (PSEi) gained 115.85 points, or 1.75 percent to 6,745.21, while the all-shares index added 67.04 points, or 1.66 percent to 4,096.48.
All of the sectoral indices ended with gains, with industrial accumulating 137.91 points, or 1.41 percent to 9,901.72, and holding firms getting an additional 130.47 points, or 2.15 percent to 6,197.51.
Services went up by 2.24 percent, or 45.29 points to 2,064.66, while mining and oil increased by 1.70 percent, or 250.33 points to 14,954.12. Meanwhile, financials went up slightly by 0.56 percent, or 8.88 points to 1,604, and property by 0.99 percent, or 26.14 points to 2,665.43.
Total volume rose to more than one billion shares, while total value turnover reached P8.73 billion.
For long term, Liu said that the market is “still intact” for an uptrend, and could reach the 7,000-point level by the end of the year.
On Monday, the PSEi was in suspended animation over the content of President Aquino’s SONA and increased by 0.10 percent, or 6.34 points to 6,627.36, while broader all-shares index slid by 0.07 percent, or 0.78 points to 4,029.44. The SONA was delivered at 4 p.m. on Monday while trading closes at 3 p.m.