PHILIPPINE stocks on Monday climbed to the highest in more than nine years. Banco de Oro and Megaworld Corp. rose on speculation faster economic growth in the third quarter would boost demand for loans and property.
"Banks and property tend to do well in a growing economy," said Mark Cañizares, an analyst at Citiseconline.com in Manila. "These stocks move ahead when the economic outlook looks good."
JG Summit Holdings Inc. fell after a report that its airline unit, Cebu Pacific, lost its right to fly to Japan from the Philippines.
The Philippine Stock Exchange Index added 8.11, or 0.3 percent, to 2,625.52 at the noon close in Manila, its highest since August 8, 1997. The measure advanced 2.9 percent in the past three sessions after the government said third-quarter economic growth may have exceeded the 5.5-percent expansion reported for the previous three months.
Banco de Oro, a lender seeking a merger with bigger rival Equitable PCI Bank (EPCIB), gained P2, or 4.8 percent, to P43.50, a record. EPCIB, the nation's third-largest lender by assets, added P1, or 1.5 percent, to P68.50, a 15-day high.
"When economic growth improves, companies and consumers take more loans," Cañizares said. "Demand for property and homes also picks up."
Megaworld Corp., the nation's largest builder of residential and office towers, added 8 centavos, or 3.9 percent, to P2.14, its highest since June 23, 1997. Filinvest Land Inc., the nation's largest builder of affordable homes, gained 4 centavos, or 2.4 percent, to P1.74, a five-month high. Empire East Land Holdings Inc., a builder of homes, gained 1 centavo, or 1.8 percent, to 58.
The stock exchange's Finance Index advanced 1 percent to a three-week high while the Property Index added 0.6 percent to a four-week high.
Bank of the Philippine Islands, the nation's most profitable lender, gained P1.50, or 2.6 percent, to P60, extending a two-day, 6.4-percent climb. The stock closed at its highest since July 8, 1999.
The lender probably had P2.3 billion ($46 million) in third-quarter profit, up 13 percent from a year ago and 10 percent from the previous three months, Gilbert Lopez, a Manila-based analyst at Macquarie, said in a note Monday.
Higher loans to consumers and lower provisioning boosted the bank's earnings in the third quarter, Lopez said. He rates the stock "outperform" and forecasts the share price to climb to P64 in 12 months.
Ayala Corp., which owns Bank of the Philippine Islands, rose P5, or 1 percent, to P490, bringing this year's gain to 56 percent.
Separately, JG Summit Holdings, owner of the nation's largest snacks maker, fell 10 centavos, or 1.3 percent, to P7.80, ending a three-day, 13-percent climb.
Shares worth P3.74 billion were traded, 78-percent more than the six-month daily average. Gainers beat losers 58 to 48 with 52 stocks unchanged in the broader market. Bloomberg
Business Mirror
October 24, 2006
http://www.businessmirror.com.ph/comp02.php
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