Stocks rise as gov’t opts for targeted lockdowns

PHILIPPINE shares closed higher on Tuesday after the government eased quarantine restrictions in Metro Manila in favor of targeted lockdowns.

The benchmark Philippine Stock Exchange index (PSEi) gained 35.61 points or 0.51% to close at 6,912.71 on Tuesday, while the broader all shares index climbed 20.03 points or 0.47% to end at 4,275.76.

“This came as investors were cheered by the decision to place the National Capital Region (NCR) under general community quarantine with granular lockdowns beginning Sept. 8,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

“The easing of restrictions in the NCR, which is the biggest contributor to the economy region-wise, is seen to mitigate the country’s overall economic losses,” he added.

Metro Manila will implement granular lockdowns beginning on Wednesday even after the Health department logged a record 22,415 new coronavirus disease 2019 (COVID-19) cases on Monday. Presidential spokesman Herminio “Harry” L. Roque, Jr. said final guidelines will be announced by Tuesday or Wednesday.

“Investors also brushed off the latest inflation print, which showed an acceleration in August of 4.9%,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a separate Viber message.

Preliminary data from the Philippine Statistics Authority showed headline inflation in August

picked up to 4.9% from four percent in July.

This is higher than the 4.4% median in a BusinessWorld poll of 16 analysts and was at the high end of the 4.1% to 4.9% estimate given by the Bangko Sentral ng Pilipinas. It also went beyond the central bank’s 2-4% target for 2021.

“Lastly, the Japan Credit Rating Agency (JCR) affirmed the country’s A- rating due to its economic resilience, relatively low debt levels, and unimpaired fiscal soundness,” Mr. Limlingan added.

JCR also kept its “stable” outlook on the rating, meaning the country is expected to maintain the country’s rating in the next 12 to 18 months.

Sectoral indices were split on Tuesday. Services gained 18.19 points or 1.03% to 1,780.93; holding firms went up by 68.77 points or 0.99% to 6,989.85; and property rose by 9.88 points or 0.322% to close at 3,086.71.

Meanwhile, financials lost 9.20 points or 0.63% to 1,448.09; mining and oil shaved off 33.76 points or 0.34% to finish at 9,655.96; and industrials went down by 14.17 points or 0.14% to 10,125.28.

Value turnover inched up to P5.4 billion with 1.96 billion shares switching hands on Tuesday, from the P5.30 billion with 1.8 billion shares traded the previous day.

Advancers beat decliners, 119 versus 76, while 41 names closed unchanged.

Net foreign buying slowed to P108.85 million on Tuesday from P263.06 million on Monday. —