Optimism pushing PSEi closer and closer to 7,000

The local stock barometer firmed up on Thursday, tracking mostly upbeat global markets, but continued to shy away from the 7,000 territory.

The main-share Philippine Stock Exchange index (PSEi) added 18.77 points, or 0.27 percent, to close at 6,952.88 as domestic investors made up for sluggish foreign investor appetite.

Christopher Mangun, head of research at AAA Equities, said the market was still in consolidation mode, hovering right below 7,000 which he described as the “inflection point” for the PSEi’s long-term movement.

“Investors are deciding to be more optimistic, which is resulting in higher valuations despite the sluggish pace of recovery in the fundamentals of most companies. Investors are also counting on a much stronger fourth quarter, which also gives a lot of consideration to the beginning of the campaign season for the 2022 national elections,” Mangun said.

“We expect to see the PSEi to move in a sideways trend channel as investors and fund managers perceive current price ranges to be fairly valued considering the current internal and external risks,” he said.

The industrial and mining/oil counters both added over 2 percent, while the holding firm and services counters added less than 1 percent.

The financial and property counters slipped by less than 1 percent.

Value turnover stood at P9.9 billion. There was net foreign selling amounting to P346.7 million.

There were 115 advancers that outnumbered 87 decliners, while 51 stocks were unchanged.

Investors picked up shares of Converge, the day’s most actively traded counter, which rose by 5.26 percent.

BPI Securities said in a research note issued on Thursday that it was upbeat on the company’s medium-term earnings outlook. The brokerage house projected Converge’s earnings to post a compounded annual growth rate of 57 percent from 2020 up to 2023, driven by sustained subscriber increase in the residential segment and cash flow margin expansion.

Meanwhile, URC and AboitizPower both added over 4 percent, while PLDT rose by 3 percent. Globe, Ayala Land and Puregold all gained over 1 percent.