Budget, water deals push stocks higher

MANILA, Philippines — The benchmark Philippine Stock Exchange index ended higher at 7,840.70, up 42.83 points or 0.54 percent even as inflation rose higher than expected to 2.5 percent.

The broader All Shares gauge also went up by 15.02 points, or 0.32 percent, to finish at 4,648.35.

Most sectoral gauges were up except for the mining and oil, financials and property.

Conglomerates led yesterday’s gainers. Total value turnover reached P6.849 billion.

Market breadth was positive, 94 gainers against 85 losers while 64 issues were unchanged.

Traders said that despite the higher-than-expected December inflation, the signing of the 2020 budget and government offer of new contracts for water concessionaires gave fresh hopes to market investors.

“The signing of the 2020 budget and renewed hopes on the contract extension for the water concessionaires sent the local market higher by 42.83 points or 0.55 percent at 7,840.70. Volume and value turnover registered 2.2 billion and P6.5 billion, respectively. Conglomerates led the uptick climbing 1.33 percent. Miners were at the tail end, shedding 0.56 percent,” Philstocks Financials said.

Malacanang is offering water concessionaires new contracts to replace the existing contracts deemed onerous.

“Hence, the chief executive is giving water concessionaires the option of accepting the new contracts minus the onerous provisions without any guarantee of not being criminally prosecuted together with those who conspired to craft the very onerous contracts,” presidential spokesman Salvador Panelo said.

Meanwhile, the December headline inflation rose more than expected in December. In a commentary, J.P. Morgan attributed the increase to demand side developments rather than the supply shocks and are expected to ebb over the course of the first quarter of the year.