PSEi returns to 6,400 level as most regional markets recover
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MANILA, Philippines—The local stock barometer gained for the second session on Tuesday, bringing the main index back to the 6,400 level, as a recovery in most regional markets boosted risk-taking.
The main-share Philippine Stock Exchange index added 66.56 points or 1.04 percent to close at 6,466.55. Across the region, stock markets traded on the upside as jitters over Ukraine waned for now.
All counters ended in positive territory but the industrial, services, mining/oil and property counters were the biggest gainers, all surging by over 1 percent.
Value turnover for the day amounted to P7.82 billion. There were 97 advancers that beat 67 decliners while 41 stocks were unchanged.
One big index gainer for the day was SMC (+9.3 percent) on the back of a play on earnings and asset sale prospects.
Another big PSEi gainer was MPI (+3.52 percent) ahead of the release of earnings results, while ALI and EDC both surged by over 2 percent.
PLDT, URC, AC, Metrobank, GTCAP, ICTSI and BDO also performed strongly, all gaining by over 1 percent.
Meralco, AP, BPI, Jollibee, DMCI, SMIC and SM Prime also contributed to the day’s gains.
Foreign investors remained in a net buying position for the day, resulting in a net foreign buying position of about P334 million.
In a research note dated March 17, COL Financial head of research April Lee-Tan said investors must not be carried away by the market’s strength given continuing volatility in emerging markets and uncertainties on the US Federal Reserve’s tapering of monetary stimulus. She said these factors could once again put an upward pressure on domestic interest rates or cause the peso to weaken.
Domestically, Tan said 2013 earnings results have been “hardly spectacular,” with most companies merely delivering profits in line with expectations while globally, markets were likewise showing signs of weakness.
As such, Tan said in the research note that it would be difficult to justify any further upgrades in COL’s 6,900 as the end-of-2014 target for the PSEi.
“Although we remain bullish on the stock market over the long term, it might be a good idea for active investors to lighten up on expensively valued stocks as we see little reason to make any further upgrades at this point. You may consider switching to other stocks that remain attractive in terms of valuation or to wait for corrections to buy back at more attractive valuations,” she said.
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