Philippine stocks rise on exports

By Dominic G. Diongson and Luzi Ann Javier

Bloomberg

PHILIPPINE stocks climbed to a one-week high Friday after a government report showed exports in January rose at the fastest pace in more than seven years and the central bank left its key interest rate unchanged. Philippine Long Distance Telephone Co. (PLDT), the nation's largest company by market value, and Jollibee Foods Corp., which outsells McDonald's Corp. in the Philippines, led gains. Just one of the benchmark's 30 stocks fell. Rising exports "could increase economic activity and spur consumer spending, which will positively affect the listed companies," said Marvin Fausto, who helps manage $3.5 billion in assets at Equitable PCI Bank in Manila. "This, plus the decision of the central bank to keep rates unchanged helped stocks gain." The Philippine Stock Exchange index climbed 71.45, or 2.4 percent, to 3099.82 in, the largest fluctuation among equity markets included in global benchmarks and the highest close this week. The measure slid 1.3 percent this week, extending last week's 7.4 percent plunge. PLDT gained P60, or 2.6 percent, to P2,360. Jollibee added P2, or 4.1 percent, to P50.50. Exports jumped 27 percent in January from a year earlier to $4.17 billion, as demand for computer chips rose. Exports account for 43 percent of the economy. President Arroyo aims to expand exports by 10.5 percent to boost growth in the $117 billion Southeast Asian economy at least 6.1 percent from 5.4 percent in 2006.  Steady rate AYALA Land, the country's biggest homebuilder, rose 25 centavos, or 1.6 percent, to P16. Megaworld Corp., a residential, office and commercial developer, jumped 25 centavos, or 9 percent, to P3. Filinvest Land Inc., the nation's fourth-largest builder by market value, gained 4 centavos, or 2.6 percent, to P1.58. Bangko Sentral ng Pilipinas on Thursday held the overnight policy rate at 7.5 percent, while maintaining lower payments for larger deposits. The decision, which came after the market's close, was expected by 11 of 12 economists surveyed by Bloomberg News. Keeping the rate unchanged may encourage consumers to take out loans for cars, homes and other goods. Metropolitan Bank & Trust Co., the biggest Philippine lender by assets, climbed P2, or 3.5 percent, to P60. Bank of the Philippine Islands, the No. 2, rose P1.50, or 2.3 percent, to P65.50.   *****  STOCK MARKET OUTLOOK  LAST WEEK: The benchmark PSE index bounced above the 3,000 support level to close Friday at 3,099.82, down 1.3 percent from 3,140 a week earlier. Apart from the global volatility, a marginal bounce in T-bill rates, the absence of a rating upgrade from Fitch and the lower than expected 2007 earnings projected by market leader Philippine Long distance Telephone Co. helped influence market sentiment.   THIS WEEK: Erwin Balita, an analyst at AB Capital Securities, sees the market moving sideways, building a new base that will support a second advance later this year. "Locally, we don't see investors making anything meaningful," Balita said. "Global stock markets are staging their own recovery rally after a traumatic selloff. However, we don't think that this would translate to a return of our bullish ways in the short term." Alvin Joseph Arogo of Unicapital Securities said it was difficult to ascertain what scenario will take place in the coming weeks. "However, we are currently leaning toward consolidation phase with mild volatility..." Arogo added. "Having the heaviest weight in the index, [PLDT's] financial performance and outlook will have a significant influence."  STOCKS TO WATCH: Arogo said property, power, consumer and bank stocks are still the attractive issues. (Honey Madrilejos-Reyes)

 

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