Friday, October 28, 2011

Philippine Stock Exchange index (PSEi) outlook weekly october 31 2011

Philippine Stock Exchange index (PSEi) outlook weekly october 31 2011 ; Stocks continued to rally on Friday after European leaders approved a plan tackling the debt crisis on Thursday while the US reported surprisingly high economic growth for the third quarter.

The Philippine Stock Exchange index (PSEi) added 1.55% or 66.22 points to pierce through the 4,300 psychological barrier and close at 4,333.72. The broader all-share index rose by 1% or 29.93 points to 3,004.91.

"Local stocks soared for a second day… [as] global investors cheered the European rescue deal," noted brokerage firm RCBC Securities, Inc. in a market report on Friday.

In a separate market report, 2TradeAsia.com, the online arm of brokerage firm F. Yap Securities, Inc., said investors cheered "Europe’s $1.4-trillion debt package, especially after [holders of Greek bonds] accepted a 50% write-down."

Banking stocks led Friday’s rally. Sy-led Banco de Oro Unibank, Inc. soared by 5.33% or P2.85 to close at P56.30, while Metropolitan Bank & Trust Co., owned by George S.K. Ty, jumped by 3.48% or P2.40 to P71.45.

Bank of the Philippine Islands, the banking unit of conglomerate Ayala Corp., climbed by 3.35% or P1.90 to P58.50.

Stocks markets zoomed higher yesterday after European leaders on Thursday approved measures to prevent the debt crisis from spreading to the larger euro zone economies of Italy, Spain and France. One of these was a 50% write-down on Greek bonds.

"The resolutions and milestones definitely created a good impact on world markets and brought relief to investors," said analyst Maria Arlysa E. Narciso of brokerage firm AB Capital Securities, Inc. in a market report.

US markets, meanwhile, welcomed a report by the US Commerce department that the US economy, the world’s largest, posted a 2.5% growth in the third quarter. Corporate earnings reported by listed US firms were also strong.

The blue chip Dow Jones surged by 2.9% or 339.51 points to close at 12,208.55, the first time it closed above 12,000 since Aug. 1, when President Barack H. Obama and the US Congress agreed to raise the country’s debt ceiling.

The broader Standard & Poor’s 500 index rose by 3.4% or 42.59 points to 1,284.59 while tech-rich Nasdaq composite index added 3.3% or 87.96 points to 2,738.63.

At home, turnover more than tripled to P12.106 billion from P3.64 billion on Thursday. This was mostly due to a P6.02-billion special block share executed yesterday by Philex Mining Corp. covering 286.78 million shares worth P21 apiece.

Foreign buying skyrocketed to P1 billion. Advancers led decliners, 90 to 46, while 40 stocks ended unchanged. All subindices ended in green territory, led by financial that surged by 3.09% or 29.13 points to 972.51.

Holding firms advanced by 1.74% or 58.81 points to 3,443.69, while mining and oil gained 1.32% or 298.10 points to 22,941.36.

Property and services leaped by 0.68% or 10.24 points to 1,514.68 and 0.61% or 9.39 points to 1,547.42, respectively. Industrial climbed by 0.56% or 38.36 points to 6,918.33.

The outlook for next week is positive.

"I think the rally may continue next week," said analyst Freya B. Natividad of 2TradeAsia.com in a telephone interview yesterday, citing the momentum in the global markets after Europe’s action last Thursday and the third quarter US growth.

The PSEi might rise near 4,400, she said, but not beyond this due to the constraints of a three-day trading week.

Financial markets are closed Monday and Tuesday to allow families to visit the cemeteries on All Saints Day on Nov. 1. For the latest updates on the stock market, visit Stock Market Today
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