LOCAL EQUITIES rebounded on Friday, as traders hunted for bargains and as optimism returned amid eased US-China trade tensions.
The Philippine Stock Exchange index (PSEi) gained 66.16 points or 0.88% to end 7,583.52 — though down for the second straight week by 2.837% from Aug. 10 — while the broader all-share index rose by 21.29 points or 0.46% to close at 4,606.69.
FACTORS
“I think this is just bargain hunting after six days of continued profit taking…” Joylin F. Telagen, research head at the I.B. Gimenez Securities Inc., said in a mobile phone message as the PSEi recessed at noon at 7,602.83, up 85.47 points or 1.14%.
RCBC Securities, Inc. said in its Stock Market Weekend Recap that was attributed to research analyst John Paolo D. Ayson that “[t]he PSEi, along with the majority of Asian markets, rose today after US and Chinese officials agreed to talk next week in order to resolve the ongoing trade dispute.”
“Week-to-date, we saw how the global market was dragged in the ongoing Turkey financial crisis. Investor’s feared a contagion effect and rushed to safety havens,” it added in explaining the second straight weekly drop.
“This news did not help ease local investor’s sentiment with the market still digesting last week’s disappointing 2Q GDP results.”
The Philippine Statistics Authority reported on Thursday last week that gross domestic product growth eased to six percent last quarter — the slowest in three years — from 6.6% in the preceding three months and a year ago, missing market estimates and taking last semester’s pace to 6.3%, compared to the first-half 2017’s 6.6% and the government’s 7-8% target for full-year 2018.
Summit Securities, Inc. President Harry G. Liu cited the central bank’s decision to aggressively raise policy rates last week to hem in rising price pressures and efforts by the Executive and the House of Representatives to resolve their disagreement over next year’s national budget as local drivers. “All of these are being digested…” Mr. Liu said in a telephone interview, pegging initial support early next week at 7,200-7,400 and resistance at 7,600-8,000.
OVERSEAS MARKETS
Reuters reported on Friday that, overseas, Wall Street rallied on generally positive earnings and waning trade jitters, with the S&P 500 Index rising 0.79% to 2,840.69, the Dow Jones Industrial Average increasing by 1.58% to 25,558.73 and the Nasdaq Composite Index edging up 0.42% to 7,806.52.
Asia was mixed, with Japan’s Nikkei 225 and TOPIX Index rising by 0.35% to 22,270.38 and 0.62% to 1,697.53, respectively; Hong Kong’s Hang Seng Index gaining 0.42 to 27,213.41 and South Korea’s KOSPI increasing by 0.28% to 2,247.05.
On the other hand, the Jakarta Composite Index shed 0.56% to 5,783.80, the Shanghai Composite Index gave up 1.33% to 2,669.10 and the blue-chip Shanghai-Shenzhen CSI 300 dropped 1.44% to 3,229.62.
LOCAL STOCKS
Four of the six sectoral indices gained: property by 69.06 points or 1.86% to close 3,772.13, holding firms by 96.86 points or 1.31% to 7,469.33, services by 13.55 points or 0.9% to 1,512.18 and industrials by 70.68 points or 0.64% to 10,976.55.
The other two fell: financials by 26.19 points or 1.43% to 1,796.6 as well as mining & oil by 14.5 points or 0.14% to 9,886.99.
Stocks that lost narrowly edged out those that gained 98 to 91, while 58 others ended flat.
Eleven of Friday’s 20 most active stocks gained, seven lost and two others ended flat.
Those that gained included Ayala Corp., Ayala Land, Inc. and SM Prime Holdings, Inc. that gained 6.73% to P999 apiece, 2.66% to P42.50 and 1.69% to P36 each, respectively. “The three raised the PSEi by a combined 63.35 points,” RCBC Securities said in its Friday report.
Manila Electric Co., Jollibee Foods Corp. and Metropolitan Bank & Trust Co. increased by 3.36% to P363 apiece, 1.65% to P271.20 and by 1.29% to 74.75% each, respectively.
Those that lost included Bank of the Philippine Islands and BDO Unibank, Inc. that gave up 3.56% to P89.50 apiece and 2.36% to P128.10 each, respectively.
Semirara Mining and Power Corp. and Megaworld Corp. ended flat at P30 and P4.94, respectively.
Some 1.158 billion shares worth P5.542 billion changed hands on Friday, compared to Thursday’s 1.058 billion shares worth P5.399 billion.
Overseas investors remained predominantly bearish for the sixth straight day, causing net foreign sales to grow 1.88% to P900.633 million on Friday from Thursday’s P884.018 million, as total sales increased by 36.27% to P3.046 billion from P2.735 billion and total purchases rose by 16.515% to P2.145 billion from P1.841 billion. — Reicelene Joy N. Ignacio

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