Index rises to 10-month high on PLDT, Petron gains

Index rises to 10-month high on PLDT, Petron gains

The Philippine Star 01/11/2006
http://www.philstar.com/philstar/NEWS200601110703.htm

Share prices extended gains yesterday, putting on 0.52 percent to a new 10-month high but there were some signs investors may be finding the market now overbought, dealers said.

They said there is likely a need for some consolidation of the recent gains before a further advance but underlying sentiment remains positive on the outlook for the economy and government finances.

The composite index closed up 11.28 points at 2,162.43 after trading between 2,151.15 and 2,167.92. This was the best finish since March 7 2005 at 2,166.10.

Volume was 628.27 million shares worth P1.147 billion.

The broader all-shares index advanced 6.62 points to 1,019.34.

Gainers led losers 38 to 30, with 59 stocks unchanged.

Dealers said sentiment on the economy and on most companies is positive, given the government’s improving finances and strong remittances from Filipinos working overseas.

"This is called the January effect. Everybody is optimistic about the economy and on almost everything at this time of the year," said Jonathan Ravelas of Banco de Oro Universal Bank.

Dealers said fund managers are also taking positions in blue chips that are likely to report strong earnings for the past year.

Indications that the US Federal Reserve may soon stop raising interest rates also boosted the equities market here, they added.

"The market may still go up. Investors are relieved that a regime of rising interest rates may soon be over," Ravelas said.

Telecom giant Philippine Long Distance Telephone Co. (PLDT) led the rise, ending up P15 at P1,845.

Top-traded Equitable PCI Bank gained P1 to P62.50, still boosted by Banco de Oro Universal Bank’s offer to merge with it. Banco de Oro advanced P1.50 to a record close of P37.

Food and beverage giant San Miguel Corp. saw its A and B shares both rise by 50 centavos to close at P64.50 and P88.50 respectively.

The government said November exports fell 1.6 percent from a year earlier to $3.6 billion.

Exports account for about two-fifths of the Philippine economy, which had its slowest rate of growth in more than two years in the third quarter last year.

Stocks also gained after BSP Governor Amando Tetangco said this year’s inflation may rise at an average of 7.5 percent to 8.2 percent, lower than initial estimates of eight percent to 8.5 percent.

Megaworld Corp., a builder of office and residential towers, added two centavos, or 1.5 percent, to P1.40 on speculation that lower inflation will help keep interest rates low. Filinvest Land Inc., the largest Philippine builder of affordable homes, rose four centavos, or 2.7 percent, to P1.54. – AFP