Local stock index firms up after 5-day selldown

photo from pse.com.ph

MANILA, Philippines—The Philippine Stock Exchange index firmed up on Tuesday as investors picked up large-cap stocks that were battered in the last five days but concerns over the US government shutdown trimmed main index gains at the end of the day’s trading.

Ending a five-day decline, the Philippine Stock Exchange index recouped 6.04 points or 0.1 percent to close at 6,197.84 in mixed trade.  This happened after the index climbed by 52.6 points or 0.85 percent in morning trade.

Jose Mari Lacson, head of research at Campos Lanuza & Co., said investors picked up shares that were sold down in previous day, such as JG Summit (+2.98 percent).

On Monday, JG Summit fell by 1.74 percent on concerns over the valuation of a 27-percent stake in Meralco that it agreed to buy from SMC.  At a valuation of P72 billion for the block (equivalent to about P236 per share), JG Summit is deemed to have bagged the deal at a good price.  On Tuesday, JG Summit was the biggest PSEi gainer.

ICTSI and EDC also contributed to the day’s PSEi bounce by gaining over 2 percent while Megaworld, Bloomberry, Semirara, AP, AEV, Petron and RLC rose by over 1 percent.

Outside the main index, Meralco gained by 3.15 percent to close at P295 per share as JG Summit’s entry removed the overhang from a divesting stockholder, SMC.

Across the region, markets were likewise mostly higher as investors digested the shutdown of the US government, which is deemed only temporary.  Nevertheless, concerns lingered over the US fiscal deadlock.

Local market breadth was still negative with 84 decliners edging out 57 gainers.

Turnover amounted to P7.88 billion.

The biggest index laggers were MWC and URC which fell by over 2 percent while DMCI, BDO, AC, FGEN, Philex and SMIC slipped by over 1 percent.  AGI and Globe telecom also closed lower.

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