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MANILA, Philippines — The local stock index surged past 6,500 on Tuesday, seen by some as a bullish breakout, as hopes for extended monetary stimulus by the US Federal Reserve boosted risk-taking.
Rising for the third straight session, the main-share Philippine Stock Exchange index racked up 86.01 points or 1.34 percent to close at 6,514.72.
Across the region, trading was mostly upbeat after US Federal Reserve chair Janet Yellen said that US stimulus would continue for “some time,” thereby lifting emerging market currencies and equities.
Following the breakout from the 6,487 to 6,500 barriers, COL Financial head of research April Lee-Tan said it’s a buy on local equities. The next immediate index target is seen at 6,550 and afterwards at 6,650.
Apart from Yellen’s comments, Lee-Tan said, the market had discounted the Bangko Sentral ng Pilipinas’ recent one-percentage-point hike in the reserve requirement.
“Last week, the market initially thought that the increase in reserve requirement was negative but many have already anticipated that BSP needs to raise interest rates. The uncertainty has been removed,” Lee-Tan said, adding that the strengthening of the local currency likewise boosted local equities.
All counters were up but the biggest gainers were the cyclical financial (+1.86 percent) and property (+1.75 percent) sub-indices, followed by the counter for holding firms (+1.22 percent).
Turnover for the day amounted to P8.56 billion, including small block transactions on BPI, Vista Land, GMAP, Puregold and LTG.
Foreigners were in a net buying position, amounting to P274 million for the day.
There were 88 advancers against 68 decliners while 42 stocks were unchanged.
Investors loaded up on shares of ICT (+4.17 percent) as well as Metrobank and Megaworld whose shares rose by over 3 percent. SMPH, AC and AGI also advanced by over 2 percent while ALI, SMIC, DMCI, BDO and GTCAP gained over 1 percent. MPI and Petron also gained albeit modestly.
Outside of PSEi stocks, Nickel Asia (+3.64 percent) traded higher in heavy volume.
On the other hand, LTG (-3.1 percent) bucked the day’s upswing.
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