RP stocks post biggest gain in 3 years

RP stocks post biggest gain in 3 years

THE Philippines’ key stock index on Monday had its biggest gain in more than three years as optimism about the economy prompted overseas investors to add to their local shareholdings. Ayala Corp. and Philippine Long Distance Telephone Co. led the advance.
       The Philippine Stock Exchange Index climbed 118.93, or 4.8 percent, to close at 2,589.17 at noon in Manila, adding to last week’s 8.8-percent gain. That’s its biggest increase since June 17, 2003 and the highest close since July 13, 1999. Gainers outnumbered losers 69 to 38.
       Over investors were net buyers of $31.5 million of local shares Monday, after pumping in $36.7 million on May 5. That’s more than six times this year’s daily average of $4.8 million.
       “They woke up and decided we deserve to be rerated,” said Marvin Fausto, who helps manage $2 billion at Equitable PCI Bank (EPCIB). An improving economy is helping draw funds, he said.
       Trading Monday totaled P5.31 billion ($103 million), more than three times the average over the last six months.
       Bank of America on Monday raised its 2006 economic growth forecast for full-year Philippine economic growth to 5.3 percent from 4.7 percent. The government said last week the economy likely expanded more than 5.5 percent in the first quarter because of better-than-expected harvests.
       Ayala Corp., owner of the nation’s biggest developer and No. 2 banking and phone companies, surged P42.50, or 9.9 percent, to P472.50, its highest since at least 1987, when Bloomberg’s records begin. PLDT, the nation’s biggest company by market value, jumped P130, or 6.1 percent, to P2,255.
       Metropolitan Bank and Trust Co., the nation’s biggest lender, rose P4.50, or 11 percent, to P47. Class B shares of Manila Electric Co., which allow overseas investors to own the nation’s biggest power retailer, rose P2, or 10.3 percent, to P21.50. Megaworld Corp., a builder of office and residential buildings, rose 22 centavos, or 13 percent, to P1.86.
       EPCIB rose P1.50, or 2.1 percent, to P73.50. Government Service Insurance System said it might postpone Monday’s auction for its 12-percent stake in the lender. It would be the third postponement for an auction first scheduled for March.
       The government’s failure to sell its stake may pave the way for the lender to be sold to Banco de Oro, whose takeover bid the fund has been opposing. Banco rose P2, or 5.6 percent, to P38.
       Globe Telecom Inc. rose P45, or 4.6 percent, to P1,030. First-quarter profit may rise 30 percent to P2.5 billion (US$48.6 million), according to the median estimate of three analysts in a Bloomberg News survey. Globe was scheduled to release results Monday.
       Union Bank of the Philippines rose P3.50, or 8.4 percent, to P45. The lender agreed to buy International Exchange Bank for P13.5 billion, Union Bank said after the close of trading on May 5. The merger would create the nation’s ninth-largest lender. Bloomberg

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