Local stocks climb as bargain hunting continues

PHILIPPINE STOCKS closed higher on Tuesday on continued bargain hunting after last week’s decline and amid window dressing activities.

The benchmark Philippine Stock Exchange index (PSEi) rose by 106.59 points or 1.70% to close at 6,345.41 on Tuesday and the broader all shares index climbed by 48.21 points or 1.43% to 3,400.68.

“Today’s rally was largely broad-based as bargain hunters continued to take advantage of extremely oversold conditions. We observed a surge of buying activity in the afternoon session after lackluster trading in the morning… Part of the move may also be attributed to quarter-end window dressing activities,” China Bank Securities Corp. Research Director Rastine Mackie D. Mercado said in an e-mail on Tuesday.

Mr. Mercado said the financials sub-index was Tuesday’s underperformer as the sell-off in the sector continues amid expectations of further monetary tightening here and abroad.

“Meanwhile, the services sub-index led the market, primarily attributable to the strong rally in telco stocks (Converge Information and Communications Technology Solutions, Inc., Globe Telecom, Inc., PLDT, Inc.),” he added.

“The market continues to gain momentum as we have seen the bottom at 6,054.79 late last week. It is almost the end of the first half of 2022, investors might expect window dressing,” Mercantile Securities Corp. Head Trader Jeff Radley C. See said in a Viber message.

“Investors (are hoping that) the new administration will help the economy moving forward, which shows [in] how strong the index is,” Mr. See added.

Most sectoral indices ended higher except for financials, which fell by 4.36 points or 0.29% to 1,483.11.

Meanwhile, services improved by 55.03 points or 3.32% to end at 1,710.88; mining and oil went up 318.65 points or 2.97% to 11,036.30; property gained 62 points or 2.16% to close at 2,930.47; industrials jumped by 145.14 points or 1.63% to 9,038.22; and holding firms increased by 83.15 points or 1.41% to 5,946.70.

Value turnover increased to P7.46 billion on Tuesday with 847.09 million shares changing hands from the P5.24 billion with 682.61 million issues seen on Monday.

Advancers beat decliners, 121 versus 70, while 47 names closed unchanged.

Net foreign selling dropped to P157.91 million on Tuesday from the P389.88 million logged the previous trading day.

China Bank Securities’ Mr. Mercado said the PSEi may continue to rise but could succumb to selling pressure once it approaches the 6,380-6,410 resistance.

“We continue to see the market’s strength this week as fleeting given prevailing uncertainties in the inflation outlook and the global economy,” he said.

Meanwhile, Mercantile Securities’ Mr. See put the PSEi’s support at the 6,000 to 6,200 levels and resistance from 6,400 to 6,500. — J.I.DP. Tabile