S&P rating upgrade boosts PH stocks

The local stock barometer climbed back to the 8,000 level on Thursday as investors cheered the latest Philippine sovereign credit rating upgrade from Standard & Poor’s.

The main-share Philippine Stock Exchange index (PSEi) rose by 48.85 points or 0.61 percent to close at 8,001.57.

Apart from pricing in the last S&P rating action, investors digested first quarter earnings results released by some local blue-chip companies.

Elsewhere in the region, trading sentiment was mixed.

“The credit rating upgrade by S&P Global Ratings from “BBB” to “BBB+” bodes well for the Philippines as this move affirms the solid economic fundamentals of the country. We expect investor optimism, particularly from institutional funds, to push share prices and trading volumes higher. Aside from the stock market’s positive reaction, we are also keen on seeing the medium- to long-term impact of this upgrade on the country’s economy and fiscal position,” PSE president Ramon Monzon said.

S&P earlier issued a positive outlook on the Philippine government in April 2018.

BBB+ is the highest credit rating so far achieved by the government and marks two notches above the minimum investment grade rating.

Local stock brokerage Papa Securities said the PSEi might even have a chance to beat March’s high of 8,032 on the back of S&P’s credit rating upgrade.

“Resistance past this area would then be February’s high in the 8,200 area which could hold in the near term due, especially with MSCI’s announcement and rebalancing still coming up this month,” Papa Securities said.

The local market was led higher by the industrial and services counters, which both rose by over 1 percent.

The financial and holding firm counters also firmed up.

On the other hand, the mining/oil and property counters slipped.

Value turnover for the day amounted to P8.17 billion.

There were 109 advancers that edged out 81 decliners while 52 stocks were unchanged.

Among PSEi stocks, big gainers included URC, which gained 7.68 percent. It announced a 3-percent year-on-year growth in first quarter net profit to P3.1 billion as the domestic coffee business pivoted back to growth after a three-year slump.

ICTSI and AGI  both surged by over 4 percent.

SM Investments and Security Bank both added over 2 percent while BDO and Globe Telecom firmed up by 1 percent.

SM Prime, Ayala Corp., Meralco, Metrobank, Megaworld and Puregold also eked out gains.