The market closed flat today at 8053.92, higher by 0.72 points or 0.01 percent. The broader All Share index was higher by 0.06 percent.
Sub-indices were mixed today. The Financials, Services, and Mining and Oil closed higher. On the other hand, the Industrials, Holdings and Property sectors closed lower. The best performing sector is the Service sector rising by 1.93 percent while the worst performing sector is the Holdings sector which fell by 0.68 percent.
Within the Service sector, TEL led the sub-index higher as it closed at 1385, which was higher by 4.29 percent versus yesterday’s close. ICT closed at 108.60, higher by 1.02 percent. PGOLD closed at 46, higher by 2.45 percent. RRHI closed at 86.50, higher by 1.76 percent.
Within the Holdings sector, SM led the sub-index lower as it closed at 970, which was lower by 1.92 percent versus yesterday’s close. JGS closed at 63.70, lower by 1.47 percent. SMC closed at 165.40, lower by 1.84 percent. MPI closed at 4.90, lower by 1.01 percent.
Which Stocks Traded the Largest Volume?
The most active stocks today include PHA with PHP 769.23 million in traded value. ALI also made it to the top gainers with a traded value of PHP 701.23 million. AC also had PHP 624.28 million in traded value.
Gainers and Losers for the Day
Significant gainers include PHA, higher by 29.52 percent, HLCM by 15.14 percent, BHI by 9.43 percent, ABG by 8.88 percent, RLT by 7.06 percent, UPM by 6.67 percent, and NRCP by 5.61 percent.
Significant losers include VITA by 10.85 percent, OV by 7.69 percent, PA by 7.32 percent, RWM by 7.06 percent, PHR by 6.91 percent, and PAL by 6.17 percent.
Market Breadth
There were 102 advances, 108 declines, while 44 names remain unchanged. Value turnover totaled PHP 7.27 billion. Foreign exchange rate stood at USD 1 : PHP 52.535.
Ripe for Another Expansionary Policy
The Bangko Sentral ng Pilipinas announced last Friday that the economy is already ripe for another cut in bank reserves (an expansionary policy). As inflation starts to go down, the central bank would most likely resume the gradual cuts in the reserve requirement ration (RRR). The RRR is the ratio of cash the bank keeps in relation to deposits. A cut in this requirement means that banks will be allowed to lend out more money which will in turn help the economy’s growth. The negative effect would be a possible inflationary hike.
In 2018, the BSP has already made two 100 basis point cuts in the reserve requirements bringing the previous 20 percent reserve standard down to 18 percent. In peso terms, a 100 basis point cut unlocks approximately PHP 100 billion worth of funds. BSP Governor Nestor Espenilla is keen on bringing this RRR to single digits by the end of his term in 2023.
HSBC sees three RRR cuts this year commencing in the second quarter while the ING bank expects a cut on the first quarter of 2019.
Market Undecided
The market registered another doji or a spinning top, a reversal candle that may cause the index to retrace. Nonetheless, the bullish formation is still intact. The 15 EMA and 20 SMA are still the estimated support. The moving averages are bullishly aligned. Both MACD and RSI are moving sideways. Support is estimated at 7862 while resistance is at 8341.
- Key Prices for PH Bluechip Stocks 30% Above 52-Week Low - June 4, 2024
- May 2024 Market Sentiment Rating of 30 PH Bluechip Stocks - June 3, 2024
- EquiTalks: ICT, BPI, AEV Updates – 5.29.2024 - May 29, 2024
