Philippine stock index declines on profit-taking

By Ian C. Sayson

Bloomberg

The Philippine stock index fell after a two-day climb. Bank of the Philippine Islands (BPI) and Ayala Corp. declined on speculation that the market’s recent gains have made some stocks expensive. “The market’s recent climb has provided investors with a good opportunity to take their gains,” said Ron Rodrigo, head of research at Manila-based Unicapital Securities Inc. Philippine Long Distance Telephone Co. (PLDT) dropped after this paper reported a mobile unit suspended a plan to invest in third-generation cell phone service technology. Ayala Land Inc. rose after property consultant CB Richard Ellis said prime office vacancies in the nation’s main business districts fell in 2006, to the lowest in at least 10 years. The Philippine Stock Exchange index lost 13.39, or 0.4 percent, to 3365.53 at the close, after climbing 1.5-percent over the previous two days. The measure has advanced 13 percent this year, advancing last week to its highest in more than 10 years. BPI, the nation’s largest lender by market value, fell P1, or 1.4 percent, to P69, shaving this year’s gain to 8.7 percent. The stock is trading at 21 times earnings compared with 18 times earnings for the main stock measure. Ayala Corp., the nation’s fourth-largest company by market value, declined P10, or 1.6 percent, to P610. The stock is trading at 23 times prospective earnings, compared with 19 times prospective earnings for the main stock index. PLDT, the nation’s largest company by market value, fell P10, or 0.4 percent, to P2595, ending a two-day, 0.8-percent advance. Investment suspended SMART Communications Inc., a wholly owned unit of PLDT, suspended its plan to invest P33 billion in third-generation mobile-phone service technology until demand picks up, this paper reported, citing president Napoleon Nazareno. Ayala Land, the nation’s largest builder, gained 50 centavos, or 3 percent, to P17.25, bringing this year’s gain to 13 percent. Philippine prime office vacancies fell to 1.6 percent last year, the lowest in at least 10 years, and will probably stay at that level in 2007 as the remaining space is too small for back-office providers and call centers, a property consultant said yesterday after trading closed. Filinvest Land Inc., the nation’s largest builder of affordable homes, added 2 centavos, or 1.1 percent, to P1.92 extending a six-day, 15-percent climb. CB Richard Ellis also said Wednesday that demand for homes this year will remain robust, keeping vacancies in apartments at the lowest since 2002. Shares worth P4.13 billion were traded, 25 percent more than the six-month daily average. Gainers beat losers 63 to 62, with 49 stocks unchanged in the broader market. Philex Mining Corp. (PX PM), the largest Philippine mining company by market value, rose 25 centavos, or 6.3 percent, to P4.25, the highest in more than two months. Copper for delivery in May gained 2.5 percent to $2.6645 a pound on the Comex division of the New York Mercantile Exchange Wednesday, because of renewed demand by hedge funds for metals. The company’s copper production gained 4 percent to 16,970 tons in 2006 from a year earlier, while its gold production advanced 31 percent to 3,419 kilograms, the state-run Mineral Economics Office said on February 7. Class A shares of Lepanto Consolidated Mining Co. (LC PM), equity reserved for Filipinos in the Philippine gold producer, jumped 2 centavos, or 7.1 percent, to 30 centavos, its highest since November 10, after the price of the precious metal climbed to a nine-month high. Its Class B shares (LCB PM) gained 2 centavos, or 6.5 percent, to 33. The spot price of gold gained 3.3 percent Wednesday to $678.85 an ounce, the highest since May 18, on expectation that demand for the metal will rise after the US said inflation accelerated more than forecast in January. The metal last traded at $678.45 as of 10:34 am in Manila. (With reporting by Luzi Javier in Manila)

 

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