The benchmark stock index closed slightly higher, remaining in record territory amid optimism on the rebalancing of the MSCI Philippines Index.
Philippine Long Distance Telephone Company (PLDT) posted the biggest gain, rising 2.73 percent or P90 to close at P3,390 per share. The Manny Pangilinan-led telecoms firm has the highest market capitalization weight of 11.7 percent in the MSCI index.
The Philippine Stock Exchange index (PSEi) finished up 0.19 percent or 13.26 points at 7,146.35, touching an intraday high of 7,155.64. The All Shares index firmed 0.09 percent or 3.87 points to 4,221.42.
The PSEi ended at its fifth all time high level so far in 2014 since it pierced the record 7,400 mark in May last year.
The MSCI effect lingered from its initial announcement on late Wednesday, August 14, with the effective date of the index’s rebalancing set for September 1.
According to its website, the MSCI Philippines Index is a free-float adjusted market capitalization weighted index that is designed to track the equity market performance of the Philippines.
The slight increase also reflected investors’ knee-jerk reaction after sitting on the sidelines as they awaited the release of gross domestic product (GDP) data due Thursday.
“Actually, it’s most likely from the MSCI rebalancing. It’s [been]pushing our index for the past few weeks… For the past weeks, there were also foreign buyers, so I’m guessing that it’s also a factor,” Fred Rara, analyst at online brokerage firm First Metro Securities Inc., said in a phone interview.
“We’ll see until the second-quarter GDP data comes out,” he added.
Alexander Adrian Tiu, equity analyst at AB Capital Securities Inc. also noted that investors were waiting on the sidelines for the announcement of the GDP results.
“The market today [moved]somewhat sideways although PLDT primarily buoyed the market. Everyone is on the sidelines, awaiting the GDP data,” Tiu said.
“And then of course, [US Fed chair] Yellen’s speech last week. She said that the [US] economy is doing good. That affected the global markets positively. Investors are turning optimistic as the Dow broke record levels. Even if it did only the intraday, still, that pushed or contributed to the global markets [advance],” he added.
Both Rara and Tiu expect the market to breach and “test” the 7,200 mark in the next few weeks, depending on the GDP results.
“For the next few weeks, we see the market going up to 7,200 [points],” Rara said.
“Tomorrow (Wednesday), we’ll probably continue to see sideways trading. They will still anticipate the GDP results. But I think we’ll reach 7,200 in the next few weeks but to sustain that, we’ll see. Whether it will remain on that level is another thing,” Tiu said.
Tiu sees support at 7,135 and resistance at 7,200. Secondary support is at 7,100, while secondary resistance is at 7,400.
Sub-indices were equally divided into the green and red. Financials declined 0.36 percent or 5.89 points to 1,641.70, while Industrial dropped 0.35 percent or 38.01 points to 10,944.75. Holding Firms dipped 0.0008 percent or 0.05 points to 6,279.80.
Services climbed 1.13 percent or 25.09 points to 2,244.05, while mining and oil increased 1.04 percent or 179.06 points to 17,424.98 and property advanced 0.15 percent or 4 points to 2,699.22
Besides PLDT, the most active advancers in Tuesday’s trading session were Megaworld Corp., DMCI Holdings Inc., SM Prime Holdings Inc., Energy Development Corp. and Semirara Mining Corp.
Losers were Universal Robina Corp., down 2.10 percent or P3.50 to close at P163.50 each; BDO Unibank Inc. was down 0.27 percent or 25 cents at P90.90. Alliance Global Group Inc. and Ayala Land Inc. were actively traded but finished unchanged.
Despite the market’s slight gains, there were more losers than gainers—93 to 76—while unchanged issues numbered 49. Total volume was 1.482 billion shares, while value turnover reached P10.265 billion.
On Friday, the benchmark stock index increased 0.52 percent or 36.60 points to 7,133.09. The market was closed on Monday for the celebration of National Heroes’ Day.