PSE trading floor AFP PHOTO / Jay DIRECTO
The local stock barometer ended at a new record high on Friday as investors focused on the country’s favorable macroeconomic prospects while global credit watcher Moody’s said local political risks won’t gnaw on the government’s creditworthiness.
Reversing sluggish trading in early trade, the main-share Philippine Stock Exchange index gained 35.94 points or 0.44 percent to close at the intra-day high of 8,180.85. This marked the PSEi’s best finish in history.
“Market sentiment continues to be
positive buoyed by the favorable outlook of analysts on the overall market. This optimism was again validated with the market closing today at yet another record high and with trading value exceeding P11 billion. We remain hopeful that our market levels and trading volumes continue to be robust,” said PSE president Ramon Monzon.
“Philippine equities closed mostly higher as the country was perceived as a less risky asset class. The perception that we have entered bull market has become stronger, and (even) after strong US inflation data raised the possibility of tighter monetary policy from the Federal Reserve,” said Luis Gerardo Limlingan, managing director at local stock brokerage Regina Capital Development Corp.
“Traders also appeared cautious after the latest threats from North Korea and (they) switched to the Philippines instead of other countries more directly involved (in this geopolitical showdown),” Limlingan added.
The local stock barometer tracked mostly firmer stock market across the region.
Meanwhile, global credit watchdog Moody’s said on Friday that the Philippine sovereign’s credit profile “balances sound economic and fiscal fundamentals against structural challenges to competitiveness and rising political risks.”
Moody’s expects robust economic growth to be sustained over the next few years, aided by the government’s focus on infrastructure development, buoyant private sector investment, and the recovery in external demand.
“The re-emergence of conflict in the southern Philippines, and the administration’s focus on the eradication of illegal drugs, represents a rising but unlikely risk to economic performance and institutional strength,” Moody’s said.
“Fiscal deficits are widening, but they have not interrupted debt consolidation and improving debt affordability. However, fiscal strength remains weak compared with similarly rated peers,” Moody’s added.
Except for the financial sub-sector, all counters gained at the local market. The biggest gainers were the property and mining/oil counters which both advanced by over 1 percent.
Total value turnover for the day amounted to P11.18 billion. Foreign investors were net buyers amounting to P473.68 million.
Buying activities, however, focused on selective large-cap stocks. In the broader market, there were more decliners (101) than advancers (98).
Investors gobbled up shares of Semirara and ICTSI, which both gained over 2 percent, while Ayala Land and SM Investments both rose by over 1 percent.
SM Prime, Ayala Corp., PLDT, Megaworld, Metrobank, Metro Pacific and AEV also contributed gains.
On the other hand, GT Capital slipped by 2.09 percent while AGI fell by 1.88 percent.
Shares of BDO, Security Bank, BPI, Jollibee and JG Summit also faltered.