THE MAIN INDEX clawed its way back above the 7,000 mark on Friday from Thursday’s worst year-to-date finish on bargain hunting and signs that Sino-US trade tensions could ease.
The Philippine Stock Exchange index (PSEi) increased by 120.39 points or 1.74% to close 7,004.77 — though Friday marked the fifth straight weekly fall, by 0.95% from Oct. 5’s 7,072.20 finish — while the all-shares index rose 60.55 or 1.42% to end 4,301.8.
PSEi ended Friday 18.15% down from end-2017’s 8558.42 closing and 22.67% lower than the last record-high finish of 9,058.62 on Jan. 29.
“After yesterday’s global sell-off, the Philippine market rallied on bargain-hunting today in tandem with other Asian markets,” RCBC Securities, Inc. said in a Stock Market Weekend Recap attributed to research analyst John Paolo D. Ayson.
“The PSEi started the day in the red, taking its cue from Wall Street’s losses last night, but bargain hunters immediately jumped in as the market was already at oversold levels,” he added, noting that index heavyweights SM Investments Corp. (SMIC); Ayala Corp., Ayala Land, Inc. (ALI); and SM Prime Holdings, Inc. as well as top gainer Universal Robina Corp. (URC) cumulatively added 73.18 points to PSEi.
Sought for comment, First Grade Finance, Inc. Managing Director Astro C. del Castillo noted that “[s]omehow, we saw a relief rally for the market today.”
“I guess all investors were really focused on the attractive valuation at hand. At this prices, it’s really a bargain for most.”
Reuters reported that Wall Street indices continued their slide on Thursday as investors worried about rising interest rates and a trade war. The Dow Jones Industrial Average slashed 2.13% to end 25,052.83, the S&P 500 lost 2.06% to 2,728.37 while the Nasdaq Composite Index dropped 1.25% to finish 7,329.06.
Asia, however, recovered from a recent sell-off, with Japan’s Nikkei 225 and TOPIX Index gaining 0.46% and 0.03%, respectively, while Hong Kong’s Hang Seng Index, South Korea’s KOSPI index, the Shanghai Composite Index, the blue-chip Shanghai-Shenzhen CSI 300, the Jakarta Composite Index and FTSE Bursa Malaysia KLCI increased by 1.96%, 1.51%, 0.91%, 1.49%, 1.31% and 1.20%, respectively.
In a mobile phone message, Regina Capital Development Corp. Managing Director Luis A. Limlingan said: “Asian shares, including the Philippines, experienced a bounce on a possible Xi-Trump meeting that would possibly end the trade tension.”
“Overnight news circulated that (China) President Xi (Jinping) will be meeting (US) President (Donald) Trump at the upcoming G20 meeting in Buenos Aires late next month. Beijing yesterday urged dialogue to resolve the conflict and said it’s ready to resume discussions for an investment treaty,” Mr. Limlingan said.
“In other market-making news, the US Treasury department’s staff has advised Secretary Steven Mnuchin that China isn’t manipulating the yuan as the Trump administration prepares to issue a closely watched report on foreign currencies, according to two people familiar with the matter. The conclusion, if accepted by Mnuchin, would avert an escalation of the US-China trade war and remove a source of anxiety for emerging markets. Mnuchin could issue a different finding.”
Locally, all six sectoral indices gained amid thinned trading, although overseas investors remained predominantly pessimistic.
Mining & oil led Friday’s gains with a 224.92-point or 2.63% surge to 8,775.43, followed by industrials’ 230.58-point or 2.22% increase to 10,575.37, services’ 27.73-point or 1.89% climb to 1,488.1, property’s 56.58-point or 1.65% hike to 3,479.81, holding firms’ 106.21-point or 1.58% rise to 6,796.92 and financials’ 15.56-point or 1.01% increment to 1,549.86.
In contrast to Thursday, stocks that advanced were more than double those that declined 127 to 56, while 47 others ended flat.
Friday’s list of most active stocks showed only three that lost: Globe Telecom, Inc. which retreated by 2.23% to close P2,100 apiece; Aboitiz Equity Ventures, Inc. which gave up 1.07% to P46.05 and Bank of the Philippine Islands which dropped 0.85% to finish P81.20 each.
Notable among stocks that gained was third major telco hopeful Now Corp., which surged by 28.67% to finish P5.61 apiece. RCBC Securities’ Mr. Ayson noted that “Now Corp. spiked after its board of directors approved the conversion of advances into equity and the participation of the company in a consortium to bid for the third telco player spot”.
The others that increased included URC, by 7.03% to P137; SSI Group, Inc., by 6.94% to P2.62; Security Bank Corp., by 5.78% to P140.90; Megawide Construction Corp. by gained 5.55% to P15.60; Jollibee Foods Corp., by 3.15% to P262; SMIC, by 2.47% to P871.50; PLDT, Inc., by 2.64% to P1,400.00; ALI, by 2.08% to P39.30; Ayala Corp., by 2.04% to P900 and SM Prime, by 1.48 to P34.20 each.
Trading volume thinned to 636.862 million shares worth P5.283 billion from Thursday’s 1.031 billion issues worth P5.427 billion.
Net foreign selling persisted, though 16.3% lower at P720.773 million from Thursday’s P861.128 million as gross sales dipped 2.62% to P3.216 billion from P3.303 billion and gross acquisitions grew 2.2% to P2.496 billion from P2.442 billion. — Reicelene Joy N. Ignacio