SHARES closed higher on Thursday after the ratification of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) bill and ahead of the release of January inflation data.
The 30-member Philippine Stock Exchange index (PSEi) improved 44.29 points or 0.64% to finish at 6,903.75, while the broader all shares index rose 22.07 points or 0.53% to end at 4,165.33.
Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a mobile phone message that the market closed higher as the proposed CREATE law now awaits the signature of President Rodrigo R. Duterte.
“Economic recovery hopes got a boost from the Congress’ ratification of the CREATE bill, compelling investors to pick up shares this Thursday,” Mr. Tantiangco said.
The Congress on Wednesday ratified the CREATE bill, which aims to reduce the country’s corporate income tax rate to 25% from 30%.
Once signed, the bill will also reduce corporate income tax to 20% for micro, small, and medium enterprises with a net taxable income under P5 million and total assets below P100 million.
Timson Securities, Inc. Head of Online Trading Darren Blaine T. Pangan said in a mobile phone message that the local bourse improved as investors opted to buy shares ahead of the upcoming release of January inflation data.
A BusinessWorld poll among 16 economists yielded a median estimate of 3.6% for January, within the 3.3% to 4.1% projection of the Bangko Sentral ng Pilipinas (BSP). January inflation data is scheduled to be released on Feb. 5.
AAA Southeast Equities, Inc. Research Head Christopher John Mangun said the market ended in positive territory even as the market remained cautious.
“Last-minute buying allowed the main index to end at its high for the day. Volatility on blue chips continues to decline as investors await earnings,” Mr. Mangun said in an e-mail.
“The general sentiment remains cautious as investors monitor the economy’s recovery,” he added.
Majority of sectoral indices at the PSE ended higher on Thursday. Holding firms increased 85 points or 1.22% to 7,045.95; property climbed 17.58 points or 0.5% to 3,518.47; financials went up 5.58 points or 0.39% to 1,431.12; and mining and oil gained 13.18 points or 0.15% to 8,698.53.
Meanwhile, industrials retreated 18.82 points or 0.2% to 9,045.35 and services dropped 2.15 points or 0.14% to 1,497.74.
Value turnover on Thursday amounted to P10.42 billion with 36.20 billion issues switching hands, higher than the P9.58 billion with 40.57 billion shares in the previous session.
Advancers bested decliners, 123 against 99, while 43 names ended unchanged.
Net foreign selling climbed to P471.61 million yesterday from the P460.10 million seen on Wednesday.
“In the last trading day of the week, we’ll have to confirm if the nearest support at 6,600 holds, with nearest resistance at 7,300,” Timson Securities’ Mr. Pangan said. — Revin Mikhael D. Ochave