THE CAUTIOUS market sentiment amid the ongoing Israel-Palestine conflict overshadowed Bank of the Philippine Islands’ (BPI) third-quarter performance last week.
Data from the Philippine Stock Exchange showed nearly 5 million BPI shares worth P532.29 million changing hands from Oct. 16 to 20, making the stock the 11th most actively traded last week.
Shares in the Ayala-led bank went down by 2.2% week on week to P105.46 apiece on Friday from P107.87 per share last Oct. 13. Its shares, meanwhile, have risen by 3.4% since the Dec. 29, 2022 finish.
The bank’s price action last week was negatively affected by the weakened overall market sentiment due to the ongoing geopolitical tensions and surge in US yields, Regina Capital Development Corp. Head of Sales Luis A. Limlingan said.
“The better-than-expected 3Q23 performance of the bank didn’t significantly impact BPI’s stock price, as it was overshadowed by the uncertainties brought about by the ongoing conflict between Palestine and Israel, as well as local and US yields,” he said in a Viber message.
The ongoing conflict between Israel and the militant Palestinian group Hamas, which began in early October, escalated last week as Israel launched air strikes in response to the group’s attacks.
The conflict has killed 1,403 Jews and 3,785 Palestinians as of Thursday and has drawn country leaders on opposing sides of the issue.
The worsening conflict may disrupt the global market and even cause an economic recession if more countries get involved, said a Reuters report.
Due to this, stock prices fell across the board as investors remained wary of the conflict’s impact on the global market.
Meanwhile, US bond yields surged following the US Federal Reserve’s signals of keeping its policy rates “higher for longer.”
The 10-year US Treasury note climbed for four straight days this week, reaching a 16-year high of 5%. It also saw a 37-basis-point jump this month causing investors to view government bonds from Asian countries as lesser in providing yields as compared with its US counterparts.
This led to weaker investor sentiment for Asian government bonds and a selling surge of regional bonds by foreigners amounting to $3.7 billion from Indonesia, South Korea, Malaysia, and Thailand, according to Reuters.
BPI’s net profit surged by 33.3% annually to P13.5 billion in the third quarter, the bank said in a disclosure to the local bourse last week, bolstered by an 18.3% increase in the top line to P35.3 billion.
This brought the nine-month bottom line of the country’s third-largest bank in assets to P38.6 billion, a 26.4% jump from the same period a year ago.
Mr. Limlingan expects the bank’s performance to continue positively for the final quarter of the year, which is seen to register a “double-digit bottom-line growth.”
He placed BPI’s support and resistance prices this week at P104.60 (260-day moving average) and P109.10, respectively. — Andrea C. Abestano
