Philippine Daily Inquirer
5:09 pm | Wednesday, March 27th, 2013
AFP FILE PHOTO
MANILA, Philippines—It came as a surprise catalyst that revitalized the bulls into scaling unprecedented heights before the long Lenten break.
As the Philippine government bagged a much-coveted investment grade rating from Fitch Ratings, the main-share Philippine Stock Exchange index rallied by 182.35 points or 2.74 percent towards its best ever finish of 6,847.47 on Wednesday. A new intra-day peak was also hit at 6,873.89 close to the end of the session.
This marked the 24th record finish for the index this year. The local stock market, which is now on its fifth year of upswing, has gained a total of 1,034.74 or 17.8 percent at the end of the first quarter.
While trading was mostly upbeat since the start of the shortened trading week due to quarter-end window-dressing, Fitch’s rating action allowed the local market to end with a big bang.
At 2:33 p.m. on Wednesday, Fitch announced the upgrade of the Philippines’ Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘BBB-’ from ‘BB+’ with a stable outlook, lifting Philippine debt grade out of “junk” status for the first time in history. This immediately triggered a new wave of buying at the stock market during the last hour of trade.
“This is the best news for us Filipinos and we are all part of this,” said Ismael Cruz, president of local stock brokerage IGC Securities.
“It’s an early Easter for the market,” said fund manager Astro del Castillo, managing director at investment management firm First Grade Finance. “It will definitely open the floodgates of investment, both FDI (foreign direct investment) and hot money. The most conservative funds are really just waiting for this feather in our cap before plowing money to our country.”
Del Castillo said this rating action would likely trigger a race among the bulls in corporate Philippines. “It seems that the Philippines is no longer carrying its cross,” he said.
Jose Mari Lacson, head of research at local stock brokerage Campos Lanuza & Co. said the market’s performance on Wednesday turned very exciting with some fast buying of large-caps on the back of the investment upgrade news.
“But the upgrade was announced late in the day, which means that UK and US markets have yet to fully discount the development. They won’t get their chance over the next few days, which means that like a rubber band, investment demand for the Philippines could stretch some more by the time the market reopens on Monday,” Lacson said.
Local markets are closed in the next two days and will resume only on Monday.
“Barring any major upheaval in the global markets or political scene over the long weekend, we expect Monday to be equally exciting or even be a bigger blast,” he said.
Value turnover amounted to P12.92 billion at the local market. There were 110 advancers that edged out 44 decliners while 35 stocks were unchanged.
By counter, property got the day’s biggest boost (+3.88 percent) while the industrial, holding firm and services sectors all surged by over 2 percent.
The day’s biggest index gainers were MWC (+6.1 percent), ALI (+5.48 percent), SMIC (+5.29 percent), Meralco (+4.75 percent), Jollibee (+4.74 percent), URC (+4.44 percent), PLDT (+4.18 percent), BPI (+3.48 percent), SM Prime (+3.35 percent) and Megaworld (+3.18 percent).
Among the few index stocks that lagged the market on Wednesday were EDC (-2.56 percent) and Globe Telecom (-1.64 percent).
Follow Us
Recent Stories:
Short URL: http://business.inquirer.net/?p=114413
Tags: bull run , Business , fitch investment grade rating , stocks
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
seo tools
No comments:
Post a Comment