SHARES bounced back on Wednesday, snapping a five-day losing streak, as optimism on investment opportunities in the Philippines revived investor sentiment.
The 30-company Philippine Stock Exchange index climbed 0.53% or 44.47 points to close at 8,404.69, recovering in time for closing bell after trading mostly in negative territory during the day. The broader all-shares index also rose 0.44% or 22.15 points to 5,055.87.
“It’s more of a rebound after the market has been oversold for the five trading sessions. The market rebounded as the finding shows that Philippines is still one of the best investment dispatches in the global market, considering the infrastructure program it’s going to implement,” Diversified Securities, Inc. equities trader Aniceto K. Pangan said in a phone interview today.
Financial news site Business Insider recently ranked the Philippines as the best country to invest in this year, which Department of Finance Secretary Carlos G. Dominguez said is due to fiscal reforms set out by the government.
Net foreign outflows slowed on Wednesday to P295.89 million against the P737.18 million in the previous session.
“But with the foreign selling, I still believe that market is still on the consolidation stage, especially after the result of inflation going beyond the target. It’s still on the high side of the range,” Mr. Pangan said.
February inflation stood at 4.5% based on the 2006 prices, toward the higher end of the local central bank’s revised target of 4-4.8%. Using the rebased index under 2012 prices, inflation rose by 3.9% in February, just within the 2-4% target.
Financials led gainers today as it rose 28 points or 1.28% to 2,206.24. Industrials went up 71.41 points or 0.62% to 11,528.44; holding firms climbed 43.05 points or 0.51% to 8,403.87; and property added 5.27 points or 0.14% to 3,754.94.
On the other hand, mining and oil dropped 204.52 points or 1.74% to 11,526.53. Services also lost 5.19 points or 0.29% to close at 1,744.2.
A total of 2.42 billion issues switched hands, for a value turnover of P8.63 billion, flat from the P8.61-billion turnover on Tuesday. Decliners narrowly beat advancers, 113 to 100, while 48 issues closed flat.
Mr. Pangan noted the main index will continue consolidating, with the next support level at 8,270.
Most Asian markets ended mostly down on Wednesday, reacting on the sudden resignation of United States Chief Economic Adviser Gary Cohn, due to differences in trade tariffs.
“Aside from this, another headline today that US is considering broad curbs on Chinese imports and takeovers, related to concerns over alleged intellectual property theft and also weighing reciprocity with Chinese investment barriers,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message.
“This all represents a real escalation and markets will likely start having to price in this risk,” he added. — A.B. Francia