Manila, Philippines – The Philippines Stock Exchange index rebounded and closed higher today.
The index ended at 6987.02, higher by 60.51 points or 1.12 percent. The broader all-share index rose by 0.31 percent.
The rally was across the board as all sub-indices closed in the green today.
The best performing sector is the Industrial sector rising by 1.47 percent followed by the Property sector which rose by 1.10 percent.
Within the Industrial sector, URC led the sub-index higher as it closed at 137.50, which was higher by 3.93 percent versus yesterday’s close.
Meanwhile, MER closed at 359.0, higher by 3.16 percent. JFC closed at 254.20, up by 1.68 percent. AP closed at 34.50 with a 2.68 percent increase.
Within the Property sector, ALI led the sub-index higher as it closed at 40.20, which was higher by 2.55 percent versus yesterday’s close.
Concurrently, MEG closed at 4.41, up by 5.00 percent. RLC closed at 20.25 higher by 1.45 percent. DD closed at 18.46 with a 2.44 percent increase.
Which Stocks Traded the Largest Volume?
The most active stocks today include ICT with PHP 528.76 million in traded value. SMPH made it to the top gainers with a traded value of PHP 325.33 million. ALI also had PHP 295.17 million in traded value.
Significant gainers for the day include VUL higher by 11.59 percent, IDC by 8.25 percent, and SSI by 5.88 percent.
Notable losers include PIP falling by 6.94 percent, FB by 6.08 percent, NOW by 4.25 percent, and X by 4.00 percent.
There were 100 advances, 83 declines, while 51 names remain unchanged. Value turnover totaled PHP 4.55 billion. Foreign exchange rate stood at USD 1: PHP 54.08.
Gov’t Eyes Non-Infrastructure Spending Cuts
The government is planning to slash non-infrastructure spending items to offset the effect of revenues lost from the suspension of oil excise taxes this January. The suspension of oil taxes was announced last week.
Finance secretary Carlos Dominguez said that the government would take necessary actions to minimize its budget deficit. Economic managers are set to identify items that will have funding cuts in the Development Budget Coordination Committee (DBCC) meeting scheduled today.
Initially, the DBCC has set a deficit ceiling to only three percent of the gross domestic product this year. This is foreseen to reach 3.2 percent in 2019 as infrastructure spending picks up, but will eventually wind down to three percent the following year until 2022. These projections are higher than the recorded 2.2 percent in 2017.
The secretary also said that since oil prices are expected to go higher as well as the peso sliding further versus the dollar, revenue loss may be offset by higher value-added taxes on fuel imports.
The estimated revenue loss is around PHP 41 billion, but the effect of the cuts in spending may be lower adding to the deficit.
Index Rebounds
The index marked a piercing black candle today, a bearish formation.
The moving averages are still bearishly aligned with the 15 EMA and 20 SMA as immediate resistance. MACD is bearish. RSI is also bearish.
Based on the chart, the index has marked another lower high. A lower low can now be expected in the coming sessions.
US futures as of writing points to a weaker open. This may again spill over to Asian markets the next day.
Furthermore, estimated support is at 6849 while expected resistance is at 7140.
Foreign Fund Flow
PSEi registered a Net Foreign Selling worth P223,540,863.71 as of October 16, 2018. On a 30-day trading period, PSEi is on a Net Foreign Selling worth PHP16,907,166,002.76.
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