Stocks continue to rise

THE LOCAL stock market yesterday posted a new all-time high—the 29th this year—as a rosy outlook for 2013 alongside banking merger and acquisition (M&A) talks kept investor sentiment buoyant.

The main-share Philippine Stock Exchange index jumped 27.08 points or 0.49 percent to a record finish of 5,579.42. The index also hit a new record intra-day high of 5,585.09.

The upswing continued to be led by banking stocks, which perked up the financial index by 1.62 percent.

JP Morgan Securities Philippines Inc. executive director Gilbert Lopez said investors were positioning ahead of an upbeat 2013 but noted that a big factor behind the PSEi’s surge to record highs was banking M&A excitement.

“People regard the merger as something positive but they are kind of moving ahead because a merger is not sure yet,” Lopez said. In the end, Lopez said he believed it was still BPI that was most likely to forge a deal to take over PNB given that the Ayala-led bank was trading at a much higher

price-to-earnings

multiple compared to either Banco de Oro Unibank or Metropolitan Bank and Trust Co. For the Lucio Tan Group, Lopez added that once the conglomerate has been restructured by the first quarter of 2013, it would bemore attractive to investors if the shares to be sold by LTG under a followon offering factored in a bank exposure that would be under a BPI entity than under PNB.