Philippine stocks recover as foreign markets climb


THE LOCAL INDEX snapped out of its four-day decline on Thursday following Wall Street’s positive movement overnight as the Bank of England’s intervention in the UK bond market doused investors’ fears.

The bellwether Philippine Stock Exchange index (PSEi) climbed by 54.57 points or 0.92% to close at 5,934.25 on Thursday, while the broader all shares index inched up by 25.24 points or 0.79% to 3,190.88.

“The index staged an oversold rally today as it tracked similar moves in offshore markets. Today’s temporary reprieve comes on the heels of an overnight decline in the US treasury yields and a surprise intervention of the Bank of England in the UK bond market,” China Bank Securities Corp. Research Director Rastine Mackie D. Mercado said in an e-mail.

Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said what the local bourse saw was a “technical bounce” supported by possible spillovers from Wall Street.

“However, over the medium term, we’re still seeing bearish bias due to [the] confluence of headwinds. Of course, we still have peso depreciation, which may likely continue due to the hawkish outlook of the Federal Reserve,” Mr. Tantiangco added during an interview with BusinessWorld Live.

Global equities staged a partial comeback on Wednesday as the Bank of England said it would temporarily buy long-dated bonds to dampen investors’ fears of contagion across the financial system, Reuters reported.

On Wednesday, Wall Street rebounded, with the Dow Jones Industrial Average adding 1.88% to close at 29,683.74, the S&P 500 Index gaining 1.97% to 3,719.04, and the Nasdaq Composite going up by 2.05% to 11,051.64.

Back home, the peso closed at P58.97 against the greenback on Thursday, gaining a centavo from its P58.98 finish on Wednesday, data from the Bankers Association of the Philippines show.

Most of the sectoral indices closed higher on Thursday. Holding firms gained 126.90 points or 2.26% to close at 5,729.84; mining and oil went up by 191.63 points or 1.84% to 10,575.30; industrials climbed by 108.87 points or 1.25% to 8,771.10; financials added 11.67 points or 0.79% to 1,484.20; and property inched up by 7.69 points or 0.30% to end at 2,545.67.

Meanwhile, services retreated by 13.94 points or 0.88% to end Thursday’s session at 1,555.75.

Value turnover went down to P5.19 billion with 658.93 million shares on Thursday changing hands from the P6.79 billion with 815.83 million issues traded on Wednesday.

Advancers outnumbered decliners, 121 to 76, while 42 names closed unchanged.

Net foreign selling went down to P491.71 million on Thursday from P588.99 million the previous trading day.

“Based on our outlook, we’re seeing bearish bias moving forward,” Philstocks Financials’ Mr. Tantiangco said, pointing to the index going below the 6,041-bear- market line

“At the same time, it has breached below the support range of 6,000-6,100,” he added.

China Bank Securities’ Mr. Mercado said: “We expect overnight developments in offshore markets to once again factor into investor sentiment and the market move for tomorrow (Friday).”

He placed the PSEi’s immediate support at 5,830 and its resistance moving within the 6,000-6,050 range. — Justine Irish D. Tabile