Stocks post gains as investors remain optimistic
STOCKS managed to post gains last week, with the Philippine Stock Exchange index (PSEi) even closing at a new high for the year, despite security concerns in the local front and unfolding market-moving stories overseas.
Last Friday, the main index closed higher by 31.61 points or 0.39% at 7,990.24.
On a weekly comparison, it gained 1.04%, while the broader all shares index eked out gains of 0.7%.
Harry G. Liu, president of Summit Securities, Inc., said last week’s big story remained the Marawi City terror attack and the declaration of martial law in Mindanao, although he said investors had already discounted these as risks as the situation appeared to be “improving rather than deteriorating.”
On Monday, the PSEi finished at its highest level for 2017 at 8,001.38, up by 93.72 points or 1.19% from the previous trading day’s closing level of 7,907.66.
The stock exchange attributed the PSEi’s rise above the 8,000 level to the “optimism over the developments in the Department of Finance’s Comprehensive Tax Reform Program.”
The House of Representatives approved the government’s tax reform bill before it adjourned. The proposal is expected to generate P130 billion for the government on the first year of implementation.
The week also started with authorities having declared the security incident at Resorts World Manila as the act of a lone gunman instead of a terror group. Still, the death of 37 guests and employees of the casino- hotelmall complex dampened gaming stocks during the week.
Still, all sectoral indices finished positively week on week, with property stocks leading the gainers with a rise of 2.2% followed by services with 2.15%.
The week also saw foreign investors buying more stocks than they sold, at P23.29 billion versus P19.64 billion, resulting in a net buying of around P3.66 billion. Gainers outnumbered losers at 114 to 110, while 18 issues during the week were unchanged.
Luis A. Limlingan, business development head at Regina Capital Development Corp., said investors last week continued to buy up after nerves were calmed followed “Super Thursday.”
He said this was after James Comey, former director of the Federal Bureau of Investigation, testified to the US Senate on Thursday that US President Donald J. Trump pressured him to close a probe into a top former aide, fired him in an attempt to change the course of the larger Russian probe, then launched a “campaign of lies” to discredit him.
The European Central Bank also gave clarity on its outlook for Europe, saying risks were “broadly balanced” although underlying inflation remained subdued.
In the UK, Prime Minister Theresa May secured a deal on Saturday to prop up her minority government but looked increasingly isolated after a botched election gamble plunged Britain into crisis days before the start of talks on leaving the European Union. •