Stock market tests 9,000 points; investors upbeat
Share prices are expected to continue to test the 9,000-point level level as optimism about the positive results from the government tax reform agenda remains strong.
Philstocks Inc. research head Justino Calaycay said investors were still generally upbeat about the economy ahead of the third week of trading in the new year.
“Data shows the bulls are still in control of the market even as the bears attempt to take their share of the pie. Thus far, the latter have not had sufficient reasons to justify their stance except the valuation perspective. Still, these voices are being drowned by optimists hanging on to the promise held by TRAIN, in particular and the broad economy in general,” Calaycay said.
The Tax Reform for Acceleration and Inclusion Law, or TRAIN, is taking effect this month, assuring the government of additional revenues to fund the budget.
“The PSEI is still expected to test a breach of the 9,000 line even as we closely watch if it is able to hold support at the 8,750-8,800 range,” Calaycay added.
The PSEi last week rose 0.5 percent to 8,814.62 while the broader All Shares climbed 0.4 percent to 5,098.75.
Among the sub-indices, the financial posted the highest week-on-week growth of 3.2 percent, followed by mining and oil which advanced by 1.32 percent. The services and holding firms increased 0.8 percent and 0.61 percent, respectively.
The property index, meanwhile, dropped 1.8 percent while industrial declined 0.25 percent last week.
Foreign investors were net buyers for the week at P2.5 billion, while the average daily value traded stood at P7.53 billion from the previous week’s average of P9 billion.
Weekly top price gainers were LT Group Inc., which rose 12.5 percent to P21.30, China Banking Corp., which gained 11 percent to P182 ,and San Miguel Corp., which advanced 7.5 percent to P129.
Top losers were PetroEnergy Resources Corp., which declined 10.5 percent to P4.97, Starmalls Inc., which dropped 9.5 percent to P8.10 ,and East West Banking Corp., which dipped 3.9 percent to P31.05.
Wall Street stocks, meanwhile, surged to another round of records Friday as earnings season kicked off amid optimism ignited by the US tax reform.
All three major indices again ended at records, with the Dow Jones Industrial Average up 0.9 percent at the closing bell to 25,803.19.
The broad-based S&P 500 finished at 2,786.24, jumping 0.7 percent from Thursday’s record, as did the tech-rich Nasdaq Composite Index which closed the week at 7,261.06.
Earnings from big banks were mixed, with JPMorgan Chase rising 1.7 percent after beating expectations, even as profits were hit by one-time effects of the tax law changes. But JPMorgan expressed confidence the tax changes would boost results long-term.
Wells Fargo shed 0.7 percent as fourth-quarter earnings rose 17 percent to $6.2 billion, but were marred by $3.3 billion in litigation costs, some in the aftermath of the fake accounts scandal. With AFP