Philippine stocks breach 6,500 for first time in history
MANILA, Philippines— The local stock index closed above 6,500 for the first time on Wednesday as cash-awashed investors chased yields and bet on the country’s good macroeconomic prospects.
The Philippine Stock Exchange index surged by 68.06 points or 1.05 percent to finish at 6,527.99.
“Everyone is in love with the Philippine market,” said Astro del Castillo, managing director at investment management firm First Grade Finance Inc.
“The PSEi almost seems impervious to market corrections. The formidable macro backdrop, highlighted by the BSP (Bangko Sentral ng Pilipinas) in its economic briefing (Wednesday morning), is likely to keep valuations elevated longer than so far assumed,” said Mark Angeles, head of research at First Metro Securities.
Stock dealers said this continued to be a liquidity-driven rally as investors continued to gobble up stocks in a low-interest rate environment. This is amid rosy prospects for corporate Philippines as well as the macroeconomic backdrop this 2013.
This run-up fulfilled albeit a few days late the birthday wish expressed by President Benigno Aquino III during his Switzerland visit: that the PSEi hits 6,500 by his birthday (Feb. 8).
Firmer overseas markets also supported risk-taking at the local market even as many Asian investors were still on holiday due to the Lunar Year turnover break.
ALI (+4.58 percent) led the day’s upswing after beating consensus profit forecasts for 2012. ALI grew 2012 net profit by 27 percent to a record high P9.0.
Megaworld, BPI, URC, MPI, ICTSI, SMDC, Semirara, Metrobank and Petron also contributed significant gains to the PSEi.
On the other hand, the day’s laggers were RLC, AGI, Aboitiz Power and Belle. RLC announced a modest 3-percent increase in October to December net profit, the first quarter in its fiscal year ending September.
Value turnover amounted to P8.28 billion. There were 112 advancers that overwhelmed 52 decliners while 50 stocks were unchanged.
Meanwhile, the PSE unveiled plans to enhance its online disclosure system used by listed companies to better serve investors.
In July 2005, the PSE provided 24/7 online system access to listed companies for the submission and announcement of company disclosures through an Online Disclosure System (ODiSy). The ODiSy manages three key areas: compliance by listed companies with disclosure rules, extended service accessibility on the Internet, and operational efficiency with the immediate processing of each disclosure submission.
The proposed enhancement envisions the adoption of best practices for listed company disclosure. Under the new system, pertinent information contained in financial reports and other required disclosures relating to material corporate actions and transactions, such as dividend declarations, notices of meetings, rights offerings and public float reports, will also be submitted in an electronic format that can be transmitted directly to analysts and data providers via their respective systems. At present, disclosures are all submitted in PDF format where information is extracted using separate procedures by different users.
“The PSE is at the forefront of improving its online disclosure infrastructure and services to our listed firms. The enhanced features of the online disclosure system will help hasten the distribution of information to the public and, in the long run, rationalize the regulatory requirements for listed companies,” PSE president Hans Sicat said.