Local stock index ends week with slight gain

MANILA, Philippines—The Philippine stock index firmed up on Friday, overcoming an early-session weakness  as prospects of further local monetary easing attracted buying on the interest rate-sensitive banking and property counters.

The main-share Philippine Stock Exchange index added 13.9 points or 0.29 percent to finish at 4,783.52, staying afloat despite a sluggish sentiment brought about by export concerns across the region.

For the week, the index was up by a modest 0.5 percent in volatile trading.

After closing at an all time high of 4,822 on Feb. 2, the market has been showing some fatigue, said Gus Cosio, president of First Metro Asset Management Inc. (FAMI).

“I think this consolidation could keep going on for a few days more; but rather than be fazed by any selling, I suggest that both traders and investors go deeper in each stock in his or her portfolio,” Cosio said in his financial blog.

“You can do some weeding out, but at the end of this downturn, you should have increased your exposure to the market.  It is like taking the bull by the horns.  If you manage to do it properly, the reward is well worth it,” he added.

The index was aided by the financial and property counters, which surged by 1.64 percent and 1.7 percent, respectively.  Mining/oil also outperformed with a 2.8 percent sub-index gain despite lingering concerns on the Aquino administration’s mining policy.

The industrial and holding firm counters, on the other hand, closed in negative territory.

Turnover amounted to P8 billion, with 96 advancers against 72 losers while 36 stocks were unchanged.

Among the index gainers were BDO, Metrobank, PLDT, AGI, ALI, AC, SM Prime, Globe and Meralco.

Non-PSEi stocks like Lepanto A (open only to local investors), PRCI, Security Bank, Manila Mining A, Puregold and Geograce also traded in heavy volume.

On the other hand, Aboitiz Power, URC and DMCI ended lower.

Sentiment was sluggish across the region following reports that China’s exports in January suffered their biggest drop since the global crisis of 2008. Closer to home, it was reported on Friday that Philippine exports dropped by 20.2 percent year-on-year in December, falling for the eighth straight month and underperforming the rest of Southeast Asia.

This prompted some analysts to predict a more aggressive monetary easing by the Bangko Sentral ng Pilipinas, and Finance Secretary Cesar Purisima, who sits on the BSP’s Monetary Board, was himself quoted as saying further interest rate cuts were needed.