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Bourse slips back above 8,300 line on bargain-hunting, tax reform optimism

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PHILSTAR

THE PHILIPPINE STOCK EXCHANGE Index (PSEi) ended the week higher on bargain-hunting, with sentiment buoyed by progress made in reconciling the House of Representatives’ and Senate’s tax reform legislation at the bicameral conference committee stage.

The benchmark index closed at 8,304.70 on Friday, up 129.77 points or 1.59%, while the all-shares index finished 4,858.86, up 58.27 points or 1.21%.

The PSEi last ended in 8,300 territory last Nov. 27, finishing 8,361.69.

Week-on-week, the index gained 1.97% on the back of Friday’s broad-based rally.

“The Index finished the week strong today after 27 out of the 30 stocks rose as investors sought stocks that were oversold in the past few days. Index heavyweights such as SMPH and ALI have found support levels above P35 and P41 per share respectively,” Jervin S. de Celis, equities trader at Timson Securities, Inc., said in a text message of SM Prime Holdings, Inc. and Ayala Land, Inc.

“Ayala Corp. and URC (Universal Robina Corp.) surged well today after a breakout from short-term downtrend lines. I think market sentiment was buoyed mainly by cheaper prices, with bargain-hunting in stocks that have been steadily keeping above their support levels.”

RCBC Securities, Inc. said in its Dec. 8 Stock Market Weekend Recap that “[t]he PSEi joined its regional peers in a strong market rally today”, while Luis A. Limlingan, managing director of Regina Capital Development Corp. said in a mobile phone message that “[t]he Philippine market tried to establish new trading ground breaking past 8,200 as part of the Christmas rally alongside regional peers.”

Wall Street itself finished stronger on Thursday, with the Dow Jones Industrial Average and the the S&P 500 Index each gaining 0.29% and the Nasdaq Composite Index closing up 0.54%.

Most of Asia joined the rally, with Japan’s Nikkei 225 and TOPIX index, Hong Kong’s Hang Seng Index, South Korea’s KOSPI, Jakarta Composite Index and the MSCI AC Asia Pacific gaining 1.39%, 0.98%, 1.19%, 0.08%, 0.40% and 0.41%, respectively.

RCBC Securities said further that gains by the House and Senate sitting in bicameral conference in harmonizing their conflicting provisions provided lift to the market. “It may also have helped that Congress expressed confidence that they will be able to reconcile the House and Senate versions of the tax reform bill by Monday and have already agreed on a compromise excise tax on sugar-sweetened beverages, which was closer to the lower rate proposed by the Senate,” RCBC Securities, Inc. said in its report.

Senator Juan Edgardo M. Angara, who heads his chamber’s Ways and Means committee, had said on Thursday that the bicameral conference committee harmonizing the Tax Reform for Acceleration and Inclusion versions from the two chambers had by that time agreed on “85-90%” of the legislation.

Most sectoral indices rose except for mining and oil, which closed at 11,482.37, down 213.36 points or 1.82%.

Financials closed at 2,110.33, up 24.13 points or 1.15%; industrials at 11,015.32, up 182.49 points or 1.68%; holding firms at 8,425.88, up 144.88 points or 1.75%; services at 1,605.48, up 6.20 points or 0.38% and property at 3,867.80, up 68.49 points or 1.80%.

Friday’s list of 20 most actively traded stocks showed those that gained led by Universal Robina Corp., which added 5.88% to P144 apiece; GT Capital Holdings, Inc., which went up 3.98% to P1,175; JG Summit Holdings, Inc., which increased by 3.68% to P69; Ayala Corp., which rose by 3.00% to P1,030 and Ayala Land, Inc. which climbed 2.14% to P43 each.

Those on the same list that lost were led by Rizal Commercial Banking Corp. which ceded 2.77% to finish P54.50 apiece and Semirara Mining and Power Corp. that dropped 2.76% to end P36.95 each.

A total of 1.02 billion shares worth P6.703 billion changed hands, compared to Thursday’s 877.69 million shares worth P5.946 billion.

Stocks that gained outnumbered those that lost 121 to 66, while 50 others were unchanged.

Offshore investors remained predominantly sellers for the sixth straight trading day, though Friday’s P37.284-million net foreign selling was the smallest amount in that period. — P. P. C. Marcelo