Stocks surge to new high

LOCAL STOCKS surged to a new record high Friday as optimism on second-quarter corporate results overshadowed offshore uncertainties.

The main-share Philippine Stock Exchange index added 35.19 points or 0.79 percent to finish at 4,458.74. The index, which is now trading in uncharted territory, has advanced 258.74 points or 6.2 percent since the start of 2011.

“Amid worrisome headwinds from the US and euro zone, the market rose on the back of tailwinds from ‘hot money’ flows. The euphoria continues,” said First Metro Securities head of research Reuben Mark Angeles.

“We continue to be optimistic about the market’s prospects given the Asian region’s relative stability compared with the debt situation in the US and Europe. This was also reflected by the upbeat performance of other Asian markets today,” PSE president and chief executive officer Hans Sicat said.

All told, investors are upbeat on corporate Philippines for the second half of the year, especially with the much-awaited infrastructure-building under the public-private partnership framework seen to finally take off.

“There’s positive outlook for the rest of the year and higher domestic liquidity continues to influence the equities market. Expect the market to break new highs,” said fund manager Astro del Castillo, managing director of First Grade Holdings.

Jose Mari Lacson, head of research at stock brokerage Campos Lanuza & Co., said the new high suggested some bullish-

ness but the run-up was “stock selective” rather than broad-based.

All counters gained ground but the financial counter benefited the most, rising more than 1 percent. Banking stocks Metrobank and Banco de Oro led the index upswing on expectations of strong second-quarter results. First Gen, SM Investments, ICTSI, URC and PLDT also helped perk up the market.

“We are a bit concerned because there is no particular reason behind the gains. There are no large-cap bargains and earnings growth is still expected to decelerate,” Lacson said. “There’s no reason to be bearish so investors are choosing to be bullish whether fundamentals agree or not.”

Value turnover was relatively high at P6 billion. There were 111 gainers as against 43 decliners while 36 stocks were unchanged. Foreign investors helped lift the market with P465 million in net foreign buying for the day.

Overnight, Wall Street was in the red after the US Federal Reserve dashed hopes of a third round of monetary easing through bond buybacks.

The closely watched Dow Jones industrial average fell 54.49 points or 0.4 percent to finish at 12,437.12. Doris C. Dumlao