PSE index rises, seen hitting 7,500 this year

STOCKS rose Thursday, bucking a session on Wall Street that saw major indices sink despite a surge in technology shares.

The PSE index, the 30-company benchmark, gained 43 points, or 0.66 percent, to close at 6,583.68, as five of the six subsectors advanced, led by financials.

The broader index representing all shares also went up 16 points, or 0.48 percent, to settle at 3,508.86 on a value turnover of P4.69 billion. Gainers matched losers, at 90 apiece, while 48 shares were unchanged.

Six of the 10 most active stocks ended in the green, led by Bloomberry Resorts Corp. which jumped 11.02 percent to P10.88. BDO Unibank Inc. climbed 4.78 percent to P144.60, while GT Capital Holdings Inc. rose 3.90 percent to P480.00.

Stock brokerage firm BDO Securities Corp. expects the PSEi to close the year at 7,500 as it forecasts corporate earnings to grow by double-digits this year.

BDO Securities head of research Abi Chiw said in a news briefing corporate earnings would likely grow 13 percent this year despite the high inflation and high interest rate environment.

“The potential catalysts for the Philippine market is if inflation continues to come down and interest rates start to stabilize hopefully by the second half of this year. These trends would improve. These will improve consumer and business sentiments and will revive interest in equities,” Chiw said.

Chiw said despite the current risk-off sentiments, now is the good time to invest in the market, particularly for longterm investors, as the market is trading at discounted valuation of 13x PE (price to earnings ratio) versus historical average of 17xPE.

Chiw said investors should consider stocks that are expected to deliver positive growth this year amid the current business environment.

Chiw listed Bank of the Philippine Islands Inc., Metropolitan Bank & Trust Co., SM Investments Corp., GT Capital Holdings Inc., LT Group Inc., International Container Terminal Services Inc., Aboitiz Power Corp., AC Energy Corp., Bloomberry Resorts Corp. and Cebu Air Inc. as their top stock picks.

The market is still trading sideways because of microeconomic headwinds.

Meanwhile, BDO Securities chief operating officer Bernhard Tsai said investors should watch out for the market’s support level of 6,390 and resistance level of 6,800.

A break in the market’s support area could indicate further downtrend in the index, while a break in the resistance level could indicate that the market would be on an upward momentum.