Stocks rebound as interest rate hike fears ease
By Arra B. Francia, Reporter
LOCAL EQUITIES bounced back on Monday, tracking positive developments in global markets as fears over interest rate hikes eased.
The bellwether Philippine Stock Exchange index (PSEi) climbed 0.96% or 80.99 points to close at 8,453.50 today, back in the green after two days of losses last week. The all-shares index was likewise up by 0.61% or 31.19 points to close at 5,083.98.
“Today’s PSEi rebound is more of tracking the rise of regional and overseas markets that were buoyed by the possible easing of interest rates pressures in the US. Some bargain hunting is also a factor given the overall market decline last week that have brought relative valuations down,” PCCI Securities Brokers Corp. Research Head Joseph James F. Lago said in an e-mail on Monday.
The Dow Jones Industrial Average jumped 1.77% or 440.53 points to 25,335.74 last Friday. The S&P 500 index also added 1.74% or 47.60 points to 2,786.57, while the Nasdaq Composite index gained 1.79% or 132.87 points to 7,560.81.
Papa Securities Corp. Trader Gabriel F. Perez also attributed the market’s increase to the strength of US markets, which also prompted markets in the Asia-Pacific region to rally.
Majority of local sectoral indices were in positive territory on Monday, with financials leading the charge with a 1.5% increase or 32.76 points to 2,213.51. Property followed with a 1.17% or 44.26-point climb to 3,818.33; services increased 0.67% or 11.81 points to 1,767.17; industrials rose 0.66% or 76.71 points to 11,549.73; while holding firms added 0.58% or 49.18 points to 8,426.02.
Mining and oil was the lone sub-index that declined, dropping 0.66% or 76.27 points to close at 11,445.18.
A total of 8.62 billion issues valued at P7.20 billion switched hands, higher than Friday’s value turnover of P6.58 billion.
Decliners narrowly beat advancers, 109 to 106, while 44 issues remained unchanged.
Foreigners continued their selling streak on Monday, as net foreign outflows rose to P731.71 million from the net sales of P573.73 million logged last Friday.
First Gen Corp was among the most actively traded stock on Monday, after disclosing that its San Gabriel Plant is now contracted with the Manila Electric Co. Papa Securities’ Mr. Perez noted the stock had the highest net foreign buying at P30.8 million.
Sought for an outlook, PCCI Securities’ Mr. Lago said the market may continue trading up, but may still be affected by the faster February inflation print of 4.5%, based on 2006 prices.
“The PSEi will certainly attempt to move back above the 8,500 level but it might be dependent on how investors will come to grips with local inflation that came in higher than expected for the first 2 months of the year,” Mr. Lago said.
