Stocks crawl near 6,900 on improved sentiment

MANILA, Philippines — Local stocks crawled near the 6,900 level yesterday on improved investor sentiment as new COVID cases decline and economic growth prospects stabilize.

The main Philippine Stock Exchange index (PSEi) finished higher for a second day, gaining 9.53 points or 0.14 percent to 6,890.73, while the broader All Shares index added 21.58 points or 0.51 percent to close at 4,286.57.

Trading weakened further with net value turnover registering P6.49 billion, below the preceding day’s P6.83 billion. This was also lower compared to the year-to-date average of P7.13 billion, implying that many are still staying on the sidelines.

Market breadth, however, was positive with 128 advancers against 82 losers, while 37 issues were unchanged.

Foreigners also became more upbeat, turning into net buyers for the first time in four days with P33 million in net inflows.

Philstocks Financial analyst Japhet Tantiangco said the market rose because of the improving COVID-19 situation.

“Our daily new COVID-19 cases have been declining lately, in turn raising hopes of further easing of restrictions in the economy. Gains were tempered however by a last minute profit-taking,”

He also cited the Asian Development Bank (ADB) retaining its 4.5 percent growth forecast for the Philippines this year – an outlier in a sea of downgrades in Southeast Asia – driven by the government’s infrastructure projects, renewed consumer spending and the vaccination rollout.

In most emerging Asian equities, shares were also lifted as China Evergrande’s promise to pay some bond interest calmed nerves.

Evergrande, one of China’s biggest private sector conglomerates, said it will make a payment due Thursday on a four billion yuan ($620 million) bond denominated in Chinese yuan.

Markets had already begun to stabilize as analysts downplayed the potential fallout from the Chinese property giant’s debt crisis.

Looking ahead, the Bangko Sentral ng Pilipinas is due for a rate-setting meeting today. The central bank is widely expected to keep its key interest rate steady at a record low.