PSEi surpasses 8,000 on Japan pledge
Credit to Author: ANGELICA BALLESTEROS, TMT| Date: Mon, 03 Jun 2019 16:23:11 +0000
THE stock market jumped to a one-month high on Monday as investors cheered the news that Japan had vowed to support the Philippines’ infrastructure projects, alongside cuts in the reserve requirement ratio (RRR) and expectations of a lower inflation rate.
The benchmark Philippine Stock Exchange index (PSEi) climbed by as much as 2.13 percent or 169.72 points to 8,139.74 at intraday trading, but a last-minute selloff pared gains to end the day
just up by 1.44 percent or 114.86 points to 8,084.88. The last time the index hit the 8,000 territory was on May 2, when it settled at 8,001.57.
The broader All Shares, meanwhile, inched up by 1 percent or 48.64 points to end at 4,939.01.
Eastern Securities Development Corp. trader Jayniel Carl Manuel said the local market cheered after Japan expressed full support for the country’s infrastructure program, or Build, Build, Build, and pledged $9 billion during President Rodrigo Duterte’s state visit to the East Asian country last week.
“That support…[boosted] our local index, especially the property sector,” Manuel said.
The property index was a notable gainer, having increased by 3.29 percent, making it the highest among the sectoral indices.
Real-estate developers Ayala Land Inc., SM Prime Holdings Inc., Megaworld Corp., Robinsons Land Corp. and Filinvest Land Inc. were among the most actively traded issues during the day.
In a market note, brokerage firm Philstocks Financial Inc. said optimism was boosted by the RRR reduction and expectations that inflation rate would land within target.
The first RRR cut, which the Bangko Sentral ng Pilipinas first announced in mid-May and amounting to 100 basis points (bps), took effect last Friday. Further cuts of 50 bps each are expected on June 28 and July 26.
Meanwhile, the central bank sees inflation for May to settle between 2.8 percent and 3.6 percent. It cited higher jeepney fares in Central Visayas as having helped with the upside pressure, but this may have been tempered by lower rice and domestic oil prices, alongside the downward adjustment in electricity rates.
Official data will be announced by the Philippine Statistics Authority on June 5, also a holiday to mark the Eid’l Fitr or the end of Ramadan.
In contrast, most of the bourse’s regional peers saw drops. Tokyo fell 0.9 percent, Shanghai dropped 0.3 percent. Sydney lost 1.2 percent and Singapore edged down 0.1 percent, while Hong Kong ended flat. Only Seoul was the exception, rising 1.3 percent.
All sectoral indices finished in the green territory.
More than 1.3 billion issues were traded valued at P10 billion.
Winners outmatched losers, 120 to 72, while 48 issues were unchanged.
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