Index ends above 8,000 as investors turn bullish

THE BELLWETHER INDEX climbed to its highest level for the year on Wednesday, breaching the 8,000 level after months of trading in consolidation phase, tracking Wall Street’s rise and as investors became bullish on the Philippines’ outlook following President Rodrigo R. Duterte’s State of the Nation Address.

The Philippine Stock Exchange index (PSEi) went up 0.82% or 65.79 points to 8,037.51 yesterday.

The all-shares index also rose 0.55% or 26.47 points to 4,779.80.

“Today’s closing level is the highest for the index since Aug. 10, 2016 when it closed at 8,051.40 points,” the local bourse said in a statement on Wednesday.

Year to date, the PSEi is up 17.5%.

“I think the investing public saw some plus signs on the economy growing in the next years. Of course, the volume is not big, but it will follow the most fundamental reason,” Harry G. Liu, president of Summit Securities, Inc., said in a phone interview yesterday, citing progress in the tax reform package, and an easing in the Marawi situation, among others, as some catalysts.

“If news continue to come in positive, then we might see another record high later,” Mr. Liu added.

Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a text message that local shares also followed US markets.

“[E]arnings powered Wall Street higher overnight. US banks led the rally following the yield move higher, covering lost grounds ahead of the FOMC (Federal Open Market Committee) meeting, which will conclude later today,” Mr. Limlingan said on Wednesday.

The Dow Jones Industrial Average rose 100.26 points or 0.47% to 21,613.43; the S&P 500 gained 7.17 points or 0.29% to 2,477.08; and the Nasdaq Composite added 1.37 points or 0.02% to 6,412.17.

The Federal Reserve is expected to keep borrowing costs unchanged at this week’s meeting, but could drop hints on the future path of interest rate hikes.

Mr. Limlingan also noted that mining stocks bounced back from the prior trading day’s slump.

“Another push at 8,000 may be seen as we approach window dressing,” he added.

Of the sectoral counters, only industrials ended in the red, dropping 0.31% or 35.27 points to 11,117.90.

Property surged 1.68% or 63.94 points to 3,864.05; mining and oil climbed 1.02% to 131.41 points to 12,980.50; holding firms rose 0.76% or 60.49 points to 7,966.62; services went up 0.49% or 8.45 points to 1,702.75; and financials gained 0.44% or 8.66 points to 1,957.51.

Advancers outnumbered decliners, 98 to 94, while 60 names closed unchanged.

Value turnover stood at P8.17 billion yesterday, higher than the P6.23 billion on Tuesday, with 1.82 billion shares changing hands.

Net foreign buying persisted, clocking in at P693.26 million on Wednesday, higher than the prior trading day’s P573.39 million. — J.C. Lim with Reuters