Stocks surge to seven-year high
The Philippine Star 03/22/2006
The stock market rose yesterday to its highest level in almost seven years as foreign investors returned to the country after moving to the sidelines over the past few weeks amid continued opposition efforts to oust President Arroyo.
The 30-company Philippine Stock Exchange (PSE) composite index rose 22.40 points at 2,185.71 after trading between 2,170.89 and 2,186.34. This is the main index’s best finish since Aug. 30, 1999 when it ended at 2,201.24.
The broader all shares index gained 13.76 points to 1,336.02. Gainers outnumbered losers 63 to 31, with 44 stocks unchanged. Volume was 1.97 billion shares worth P1.49 billion.
Analysts said investors are cheering the fact the government has been able to contain its budget deficit for the first two months of the year as revenues increase while corporate earnings look solid and set to rise.
"The market is buying all the good news," said Nestor Aguila of DA Market Securities Inc. although he cautioned that some stocks now look pricey.
"We’ve seen strong foreign buying in the past sessions. It seems that confidence in the Philippine market has returned," said Nina Tinio of Unicapital Securities Inc.
"Assuming the political noise just stays political, this gain will be sustained,’’ said Paul Garcia, who helps manage P20 billion at ING Investment Management Philippines Inc. "Stocks are still cheap based on fundamentals," he said, adding that the index may climb to 2,500 this year.
At the Philippine Dealing System (PDS), the peso weakened by 10 centavos to close at 51.13 from 51.03 to $ 1 on Monday on speculation the Bangko Sentral ng Pilipinas (BSP) will unload the local currency to help domestic exporters remain competitive.
"There’s rumors the BSP may intervene, so the market’s backing off and the peso is just weakening a little," said Rovic de Guzman, a senior dealer at Union Bank of the
The peso opened strong at 51.03 but weakened during intraday trading to hit a low of 51.14 to the dollar.
The peso has climbed 3.9 percent so far this year. A stronger peso will make exports, which accounts for about 40 percent of the $85 billion economy, more expensive to overseas buyers.
Steady flow |
SM Prime, the nation’s biggest shopping mall owner, rose 10 centavos, or 1.3 percent, to P8. Company President Hans Sy said profit growth, which last year was the slowest in a decade, will pick up in 2006 as it opens new malls. Parent SM Investments Corp. rose P1, or 0.5 percent, to P225.
Petron, the country’s only publicly traded oil refiner, gained five centavos, or 1.1 percent, to P4.60. It said profit rose to P6 billion last year from P3.43 billion in 2004 as it opened more outlets and boosted exports.
Philippine Long Distance Co. (PLDT), the nation’s biggest company by market value, rose P35, or 1.9 percent, to P1865. Class B shares of San Miguel, the nation’s biggest food and beverage company, rose P1.50 or 1.9 percent, to P80.50.
With the "tapering off" of political challenges, "we see interest rates decline and a steady flow of cash back into stock markets," said Rico Gomez, who helps manage about $1 billion at Rizal Commercial Banking Corp. (RCBC)
Ayala Land Inc., the Philippines’ largest developer, rose 25 centavos, or 2.3 percent, to P11. Globe Telecom Inc. was up P5 at P900. –AFP
http://www.philstar.com/philstar/news200603220701.htm
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