Stocks advance as market expects strong earnings
PHILIPPINE SHARES rebounded on Tuesday on expectations of strong corporate results, with the peso’s weakness slightly denting market sentiment.
The benchmark Philippine Stock Exchange index (PSEi) inched up by 0.08% or 6.53 points to close at 7,413.16 on Tuesday, while the broader all shares index rose by 0.12% or 5.21 points to end at 4,085.50.
“The local market marginally gained this Tuesday. The gains are seen to be reflective of investors’ expectations of good third-quarter corporate results and continuous monetary policy easing by the Bangko Sentral ng Pilipinas (BSP),” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.
“The gains were tempered, however, by the rise of the US Treasury yields and the weakening of the local currency,” he added.
On Monday, the yield on the benchmark US 10-year Treasury note rose to its highest since July 26 at 4.22%, Reuters reported.
Meanwhile, the peso closed at P57.88 per dollar on Tuesday, dropping by 29 centavos from Monday’s finish of P57.59, Bankers Association of the Philippines data showed.
This was the local unit’s worst close in more than 10 weeks or since it finished at P57.90 per dollar on Aug. 9.
“Philippine stocks ended slightly up as investors remained cautious, opting to stay on the sidelines while awaiting fresh catalysts, such as companies’ third quarter earnings results,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
“While sentiment remains largely positive, with optimism that equities have more room to advance, concerns about elevated valuations — particularly in the run-up to the US presidential election — long with rising geopolitical risks, could lead to increased market volatility,” he said.
Majority of sectoral indices closed lower on Tuesday. Financials declined by 0.5% or 12.15 points to 2,411.22; property dropped by 0.41% or 12.13 points to 2,928.01; holding firms retreated by 0.3% or 18.75 points to 6,185.48; and mining and oil went down by 0.15% or 13.42 points to 8,669.13.
Meanwhile, services rose by 1.21% or 27.32 points to 2,281.60; and industrials went up by 0.68% or 68.76 points to 10,100.89.
“Monde Nissin Corp. was the top index gainer, jumping 3.94% to P11.08. Nickel Asia Corp. was at the bottom, falling 2.88% to P3.37,” Mr. Tantiangco said.
Value turnover climbed to P5.31 billion on Tuesday with 916.59 million shares traded from the P3.3 billion with 638.33 million issues that changed hands on Monday.
Advancers narrowly beat decliners, 99 versus 94, while 55 names were unchanged.
Net foreign selling stood at P16.04 million on Tuesday versus the P161.44 million in net buying recorded on Monday. — R.M.D. Ochave with Reuters
