MANILA, Philippines — The Philippine equity market has been steadily recovering from the impact of the coronavirus pandemic and the subsequent community lockdowns, the Department of Finance (DOF) said.
Citing a report from Philippine Stock Exchange (PSE) president Ramon Monzon to the Capital Market Development Council (CMDC), the DOF said the stock market index has gradually climbed since it plunged to 4,623 in March, when the government started to impose quarantine measures to contain the spread of the coronavirus.
As of Dec. 2, the DOF said the PSE index dipped by only 9.4 percent, closing at 7,080.62 as compared to the 2019 finish of 7,815.26.
“We are now at 7,080, and, in fact, the market is doing very well especially for the month of November. We have gone up, just for the month of November, our markets are up by 10.7 percent,” Monzon said in his report.
Yesterday, the PSEi closed at 7,272.80.
He said trading volume averaged at P12.66 billion per day in November, almost twice the daily average of P6.7 billion over the January to October period.
“This brings our year-to-date average trading volume to P7.19 billion, just 1.4 percent below the 2020 average trading volume,” Monzon said. “Trading was weakened by the pandemic but has regained ground in the past two months.”
Meanwhile, Monzon said companies also continued to turn toward the equities market in raising funds this year, with about P90 billion in capital generated from January to October this year. This was 11.4 percent down from the P101.59 billion capital raised for the whole of 2019.
“Capital raising at the PSE has been robust in 2020 in spite of the pandemic,” Monzon said, citing Converge ICT Solutions, Megawide Construction Corp., San Miguel Corp. and MerryMart Consumer Corp. as among the companies who have raised funds through the stock market.
He said Cemex Philippines, AC Energy Philippines, Century Properties Group, Altus Property Ventures Inc. and Ayala Land AREIT Inc. also raised capital this year through the PSE.
In the pipeline are the fundraising activity of AC Energy, the issuance of preferred shares by Cebu Pacific, and follow-on offerings by Italpinas Development Corp. and 8990 Holdings Inc., Monzon said.
He said the PSE also expects upcoming offerings from DoubleDragon’s Real Estate Investment Trust (REIT), Robinson Land Corp. Office REIT, Megaworld REIT and Ortigas Land REIT.
Composed of representatives from the public and private sector, the CMDC is a coordinating body tasked to facilitate the development of the Philippine capital market. It is co-chaired by Finance Secretary Carlos Dominguez, lawyer Benedicta Du-Baladad of FINEX and Securities and Exchange Commission (SEC) chairperson Emilio Aquino.
“Looking at all these numbers, from a capital market’s point of view, it would seem that the COVID-19 effect is not such a big bump on the road as other people make it out to be when we talk about the economy,” Dominguez said in response to Monzon’s report.