Stocks consolidate as offshore tensions continue

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LOCAL STOCKS closed higher on the first trading session of September, with all sector indices turning in positive results, as investors opted for safety amid global uncertainties, analysts said.

On Monday, the Philippine Stock Exchange Index (PSEi) rose by 76.63 points or 0.96% to end at 8,035.20.

The broader all-shares index also climbed by 38.72 points or 0.82% to finish higher at 4,761.99.

“Investors sought for a safe refuge amidst the tension in North Korea, as shares were bought up heavily to begin the first trading session of September,” said Luis A. Limlingan, business development head at Regina Capital Development Corp.

Miguel A. Agarao, vice-president of Philequity Management, Inc., also pointed to overseas tension as a driver for yesterday’s session.

“I think consolidation will continue, especially given the rising geopolitical tension in the region. However, our market’s strength today is a positive sign considering other Asian markets fell because of North Korea’s bomb test,” he said on Monday.

“Until tax reform is passed in full, I expect the sideways movement to continue,” he added.

Yesterday, four of the six sub-indices registered an increase of over a percentage point, with mining and oil stocks taking the lead with a 241.49-point uptick or 1.82% to 13,495.43.

Property stocks came out strong as they gained 59.92 points or 1.42% to end at 3,773.72. Holding firms advanced by 93.01 points or 1.18% to 7,931.12. Industrial stocks moved up by 116.56 points or 1.06% to 11,111.73.

Financials and services lagged. The services counter rose by just 8.53 points or 0.49% to 1,729.62 while financial stocks went up by 0.39 point or 0.02% to 1,989.03.

Trading value thinned by 43% to P6.45 billion yesterday from P11.26 billion on Aug. 31, with 887.27 million shares changing hands.

Gainers outnumbered losers at 115 to 83, while 50 names closed unchanged. Foreigners bought more stocks than they sold on Monday, resulting in a net buying of P257.99 million, although 40% lower than the previous session’s net inflow of P426.13 million.

Joseph Y. Roxas, president of Eagle Equities, Inc., described local shares’ outlook for this month as “still not good.”

“Usually, [the stock market is] in the doldrums till end-October,” he said.

““If it (PSEi) breaks 8,100 [then] that is the significant situation,” Harry G. Liu, president of Summit Securities, Inc., said yesterday.

On the opposite end, Mr. Liu said the main index falling past 7,800 would prompt investors to analyze what triggered the decline.

He added that September, the last month of the third quarter, is the time when fund managers analyze the performance of issues towards yearend. He said investors might be looking at buying options for the rest of the year. — Victor V. Saulon