Roundup: Philippine stocks snap four-day loss

The Philippine market snapped a four-day losing streak on Friday after the U.S. markets rebounded anew and following the entry of bargain hunters who took advantage of the bleeding stocks to beef up their portfolios.

The bellwether Philippine Stock Exchange index rose by 0.98 percent or 27.68 points to close at 2,830.99, while the all share index edged 0.79 percent or 14.29 points higher to settle at 1,804. 31.

Trading was within average where some 4.74 billion shares valued at 3.28 billion pesos (67.22 U.S. dollars) were exchanged. Foreign investors were net sellers at 24.5 million pesos (502,000 U.S. dollars).

All six subsector indices treaded higher, led by mining and oil stocks which gained 2.41 percent or 203.14 points to 8,600.98.

A total of 86 stocks regained their value while 31 shares slipped. A total of 53 shares meanwhile retained their value.

"The local market has finally rebounded after experiencing several days of losses. It had again took its lead from the U.S. markets," Paul Balaoing of local brokerage PCCI Securities Brokers Corp. said in an interview.

Balaoing attributed Friday's rally more to a "technical correction" rather than a trend, pointing out that the local composite index remains to be expensive.

"The Philippine market has been down for several days so investors took the opportunity to pick up the stocks that have been battered for the past four days since there was positive news from abroad," he said.

The Dow Jones industrial average index went up by 0.69 percent or 63.94 points to settle at 9,344.61 on Thursday after U.S. August retail sales beat investors' expectation.

Nonetheless, Balaoing said investors should not expect much from the local market next week since it will just likely resume its correction.

"We expect the market to correct again next week especially since the indicators are pointing to an overbought local market. From the looks of it -- whether on a weekly or monthly point of view -- the value of the index is already high," Balaoing said.

This statement came despite the market losing 0.76 percent or 21.94 points of its value this week. Year to date, the composite index has already regained almost half of what it lost to last year's carnage.

The relatively lackluster performance of the market this week has been attributed by most analysts to lack of positive leads locally and overseas.

The 22-year low 0.1-percent August inflation has mostly been anticipated by investors and as such it did not come as a surprise at all. Adding further salt to the injury is the four-day decline of the U.S. markets.

Still, despite the local market attempting twice to break below the 2,800 level this week, analysts said it was quite notable how bargain hunters will enter at the latter part of the trading preventing the Philippine market to close at a lower end.

Analysts said the local composite index has a strong support at the 2,800 level although it remains to be seen whether it can successfully break above the 2,900 level.

"Investors are pacing their investment, preparing mostly for the local market and the local economy's rebound next year. Some are holding on to their positions while some are simultaneously buying cheap stocks which kept the market afloat," Balaoing said.

Most stocks in the 30-company index went up.

Shares of Philippines' third largest property developer Megaworld Corp. soared by 4.05 percent or six centavos to 1.54 pesos (0.03 U.S. dollar). Likewise, heavyweight Philippine Long Distance Telephone Co. rose by 0.2 percent or 5 pesos (0.10 U.S. dollar) to 2,420 pesos (49.6 U.S. dollars).

Philippines' largest power distributor Manila Electric Co. meanwhile slipped by 1.03 percent or 2 pesos (0.04 U.S. dollar) to 192 pesos (3.93 U.S. dollars) after touching its record high or 302 pesos (6.18 U.S. dollars) apiece just last month.

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