Investors look to tax bill progress in hunt for leads

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INVESTORS will primarily be looking at the possible passage of the tax reform package as the major catalyst for the market this month, after a loss in November.

Investors look to tax bill progress in hunt for leadsThe Philippine Stock Exchange index (PSEi) ended at 8,254.03 on Nov. 29, the last trading day of November, and recorded a loss of 1.33% for the month. The highest close for the month was 8,523.07 recorded on Nov. 6.

Corporate earnings lifted the market during selected trading days of the month, but investors mostly took profits despite good third-quarter gross domestic product results.

Metropolitan Bank & Trust Co. had the highest return in the blue-chip category, while Semirara Mining Corp. led losers, down by 15.29%

“The reconciliation of the tax reform bill version of the Senate and the House of Representatives will be one of the focus of local investors as the current admin is expected to sign it into law this month. Aside to this major catalyst, window dressing may also push our index higher, so, I’m guessing a rally towards 8,800-9,000 area before end of the year is highly likely,” Jervin S. de Celis, equities trader at Timson Securities, Inc., said in a text message.

The Senate earlier this week approved its version of the tax reform package, and a bicameral session is expected this month for the Senate and the House of Representatives to reconcile their versions and target enactment before the year ends.

Financial markets were closed yesterday in observance of Bonifacio day.

Meanwhile, other Southeast Asian stock markets were downcast on Thursday as broader Asian equities fell sharply on a selloff in technology heavyweights, with Singapore falling the most.

MSCI’s broadest index of Asia-Pacific shares outside Japan retreated over 1% after US technology stocks posted steep losses overnight as investors shifted to financials and other sectors that could potentially benefit from lower regulation and taxes, as well as higher interest rates.

China economic data showing an unexpected pickup in factory activity in November had little impact on Asian shares.

Singapore shares fell as much as 0.6% to their lowest in a week, weighed down by industrial and financial stocks. DBS Group Holdings and Jardine Matheson Holdings Ltd were the top drags on the index, inching down 1.1% and 1.7%, respectively.

Malaysian stocks held steady as losses in consumer discretionary stocks offset an about 30% jump in Sime Darby Bhd after the company’s plantation and property  units debuted on the Jakarta Stock Exchange. Trading in Sime Darby Bhd was based on the reference price provided by the company of 1.85 ringgit per share.

Indonesian shares slipped 0.3% as consumer staples and telecom stocks weighed, with the index of the country’s 45 most liquid stocks down 0.3%.

Unilever Indonesia Tbk PT, a unit of Unilever Plc, and United Tractors Tbk PT fell about 1.2% and 2.1%, respectively. — with Reuters