Bulls lining up to fire up market

After it fell into the bear market less than six months ago, the Philippine Stock Exchange index returned to the bull market on the last trading day of the week as local shares near 7,000.

Shares at the bourse surged 118.01 points to 6,951.54 on Friday — 1.73 percent higher than the previous day’s close.

“The index has now made strides into the bull market territory since falling into the 5700 range less than 6 months ago. A bull market normally occurs when a stock market rises at least 20 percent from a recent low, though some like to argue whether to use an intraday price or closing price as the marker,” Luis Limlingan, Head of Sales at the Regina Capital, pointed out.

“Another point of contention is the length of the period needed to reach the 20 percent mark and the duration before it can be considered a bull run,” he added.

Limlingan also noted that the rally will “obviously catch the attention of foreign investors as value turnover has noticeably picked up lately.”

“Philippine shares snatched another winning day as the US December’s CPI report showed prices declined 0.1 percent over November.

While prices rose at a 6.5 percent pace compared to the previous year, the results heightened hopes that the Federal Reserve may soon slow its hiking,” Limlingan said.

He also noted that among other drivers in the market, Bangko Sentral ng Pilipinas governor Felipe Medella’s “rosy inflation outlook” boosted investors’ prospects.

Medalla said the worst of the Consumer Price Index surge was potentially over, and inflation could drop fall within the national government’s target range of around 2 to 4 percent in the third quarter.

Meanwhile, Philstocks Financial, Inc. assistant manager for research and online engagement Claire Alviar said the local shares followed its Asian peers in the green territory.

This raises investors’ hopes that the Federal Reserve would have slower interest rate hikes ahead.

Positive cues

“Asian markets were also in the green following the positive cues from Wall Street. This raises investors’ hopes that the Federal Reserve would have slower interest rate hikes ahead,” Alviar said.