Philippine stocks rise on China’s vow to boost growth
MANILA, Philippines—Local stocks sharply rebounded on Monday as regional markets took heart from the Chinese Prime Minister’s vow that Asia’s largest economy would focus on stimulating economic growth.
The main-share Philippine Stock Exchange recouped 74.58 points, or 1.53 percent, to finish at 4,954. The local markets thus firmed up after a bloodbath that caused a 5.4 percent pullback last week but overall sentiment was still cautious for the near term.
All counters surged on Monday but the cyclical stocks like banking and property benefited the most, respectively rising by 2.28 percent and 2.42 percent, on improved prospects for growth in emerging Asia. The mining/oil index was likewise up by 2.1 percent as China’s stance also boosted commodity markets.
Value turnover for the day amounted to P6 billion. There were 103 advancers that overwhelmed 42 decliners while 40 stocks were unchanged.
The main index was led higher by PLDT, ALI, Metrobank, SM, BDO, Megaworld, Metro Pacific Investments, BPI, Meralco, AGI and Aboitiz Power.
Investors also picked up shares of non-PSEi stocks like GT Cap, Philex Petroleum, Security Bank and Eastwest Bank. VMC, which resumed trading after a 15-year suspension, zoomed 931 percent higher to close at P2.99 per share.
On the other hand, DMCI, URC, SM Prime and Ayala Corp. bucked the day’s upswing.
Regional markets, battered in the past two weeks by the fiscal contagion in Europe, found relief from the Chinese Premier’s call for additional efforts to support growth.
“In emerging markets, assets suffered the last week amidst the risk-off trading sentiment with the ongoing uncertainties hanging over in Europe. Given the magnitude of the fall last week and remarks by Premier Wen in China over the weekend that the government will focus more on maintaining growth, some rebound in risk assets cannot be ruled out. However, we remain cautious on any rally in the near term as a comprehensive resolution to the European debt problem is yet to be found and the growth momentum in Asia seems to be losing steam,” said investment bank Credit Agricole CIB on Monday.
“In terms of economic data, we could see some good headline numbers but these should not be generalized into an overly optimistic growth outlook for the region,” Credit Agricole added.
