Philippine stocks climb to 34th all-time high year-to-date
Shares on the Philippine Stock Exchange closed broadly higher in active trading Tuesday, buoying the main PSEi to a 34th all-time high in the year-to-date.
Tuesday's trading results prompted Justino Calaycay Jr., senior analyst at Accord Capital Equities Corp., to say the “strength is legitimate,” supported by volume that makes the 5,800 target for the year “look feasible. It looks like it will be done.”
The strength is coming from “a strong economy... proven by the 7.1 percent GDP growth in the third quarter, which is already above the target,” Calaycay noted, saying “the five to six percent target has already been exceeded by default.”
In terms of foreign buying, “there were no significant spikes but a steady stream of foreign funds coming in... supporting the market,” said Accord Capital's analyst.
The main PSEi rose 33.58 points or 0.59 percent to end the session at 5,706.28.
More than 3.092 billion shares valued at P8.290 billion were traded, with all sub-sectors posting gains.
Winners led losers 76 to 75, with 56 issues unchanged.
While market players are waiting for a correction on the perception that Philippine stocks are expensive at 18 times earnings compared with the 15 times historic average, Calaycay said “we might be seeing a change of norms” in terms of the price-earnings ratio.
“Only if there is no support from company earnings can we say that stocks are overvalued, but company earnings are supportive of the valuation of stocks and the market's movement,” he noted.
With interest rates at historic lows, there is no way fixed-income placements can compete with the 30.5-percent gain of the PSEi in the year-to-date, he added, saying “the Philippine market is now the top perfromer in the world.” — BM, GMA News
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