THE local stock barometer broke into the 6,900-point territory as a confluence of positive factors — strong corporate earnings, monetary policy easing by the Bangko Sentral ng Pilipinas (BSP), and upbeat cues from Wall Street — combined to lift investor sentiment, while the Philippine peso also extended its gains against the greenback for the second day in a row.
The benchmark Philippine Stock Exchange index rose 0.80 percent, or 54.89 points, to close at 6,944.76, just 35.05 points lower than its peak this year of 6,979.81 reached last April 1.
The broader All Shares index added 22.64 points, or 0.61 percent, to finish at 3,729.09.
Among the sectors, financials continued to lead, adding 2.54 percent, while the property sector was at the tail end, shedding 0.84 percent.
Decliners outnumbered gainers, 120 against 89, while 51 stocks were unchanged.
Japhet Tantiangco, senior research analyst at Philstocks Financial Inc., said the sustained market uptrend was due to “expectations that the BSP will continue with its monetary policy easing moving forward, and positive cues from Wall Street continued to lift sentiment.”
“Investors also cheered the balance of payment (BOP) surplus posted by the Philippines in July and the strengthening of the local currency,” he added.
The country’s BOP in July swung to a surplus of $62 million from a deficit of $53 million a year earlier, the BSP announced Monday.
“Philippine shares broke into the 6,900 level and now are just a stone’s throw away from the 7,000 level, with investors continuing to buy into the strong earnings, the recent 25 bps (basis points rate) cut, and upgrade… [to] investment grade for the country,” Regina Capital Development Corp. Managing Director Luis Limlingan added.
Last week, the BSP said Japan’s Rating and Investment Information, Inc. (R&I) had upgraded its rating on the Philippines from last year’s “BBB+” with a positive outlook to an “A-” with a stable outlook. This is the second A-level rating the country has obtained after securing an “A-” rating from the Japan Credit Rating Agency Ltd. (JCR) in 2020.
“US equities also went for another winning day as the market continued to recover from the previous sell-offs,” Limlingan said, adding that “many are awaiting word from [US Federal Reserve] Chair [Jerome] Powell this Friday.”
Peso extends gains
The Philippine peso strengthened for two consecutive days against the greenback on Tuesday.
The currency strengthened by 9 centavos to P56.55 against the greenback from the previous P56.64, data from the Bankers Association of the Philippines (BAP) showed.
This was the local currency’s strongest close this year, when it ended at P56.53:$1 last April 12.
It opened trading at P56.60 to the dollar and ranged from P56.51 to P56.64. Volume reached P1.548 billion, slightly lower than the P1.610 billion recorded in the previous session.
Rizal Commercial Banking Corp. chief economist Michael Ricafort observed that the peso strengthened following the recent decline of the US dollar against major global currencies, with the greenback falling to new 7.5-month lows.
“The peso also gained versus the US dollar after the recent gains in the local stock market,” he added.
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