Stock Market Update: PSEi Sets New Record High Of 7,490 Due To Oil Price Cuts

Philippine Stocks Exchange sets a new record, another mark in the Philippine stock market history. If you're not yet investing, this might be your chance. Interested to learn, click, HERE.

PSEi rallies to new record high of 7,490 due to oil price cuts

MANILA, Philippines—The local stock barometer rallied to a new record high on Wednesday, even probing the 7,500 mark for the first time in intra-day trading, as investors bet on the favorable impact of lower oil prices on the Philippine economy.

The Philippine Stock Exchange index advanced by 91.88 points or 1.24 percent to close at 7,490.88, defying the slump elsewhere in regional markets.  The PSEi also hit a new intra-day peak of 7,530.41.

Most counters firmed up led by the property sub-index, which rose by 2.1 percent while the industrial and services counters were both up by over 1 percent.

Only the mining/oil counter was in the red for the day, tracking the slump in global commodities.

“With (low) gas prices fuelling (consumer) demand and low inflation rate in December, the economy has room to grow,” said Joseph Roxas, president of local stock brokerage Eagle Equities Inc.

The index rallied despite the start of a long weekend during, which many investors would otherwise typically hedge by paring down holdings.

The local stock market is closed on Thursday (Jan. 15) and Friday (Jan. 16) during the papal visit. It will resume trading on Monday (Jan. 19).

Source: business.inquirer

Manila stocks on track to close at record high

Manila's benchmark stock index is on pace to finish at a record-high, as investor preferences shift towards Southeast Asian and emerging market stocks.

The Philippine Stock Exchange Composite rose 1.8 per cent in the morning session, led by industrials and financials.

One reason for the gains is that investor preferences are shifting towards emerging markets.

Manila's index of 30 companies is now up more than 8 per cent since a recent low on Dec 17. Over the same period emerging market stocks have climbed 5.5 per cent, according to MSCI. Last year Manila's index rose nearly 23 per cent, a sixth straight annual gain, whereas MSCI's emerging markets index fell 4.6 per cent.

Analysts at UBS argue 2015 equities will be a better year for EM equities:

Despite macro headwinds [i.e. the Fed lifting US rates] we see a positive impact from weak commodity prices on EPS growth across much of EM and most of Asia.

Another reason is that southern Asian economies stand to benefit from China's rise.

Barclays analysts point out that rising incomes and a stronger currency in China have already begun to shift the export landscape toward Southern Asia - including Vietnam, Myanmar, the Philippines and Sri Lanka.

The dispersion of low-end manufacturing out of China is re-shaping trade routes in Asia and is driven by Chinese manufacturing wage rates that are nearly double that of other emerging Asia countries, given the renminbi's average 10% appreciation against competing Asian exporters in the past two years.

The Philippines has a tiny share of global trade, at just 0.3 per cent. But Barclays estimates that last year its manufactured goods exports rose 11 per cent, versus a 2 per cent slide in 2013.

Investors have taken notice. Here are year-to-date stock market returns for Southeast Asia:

Philippines: +4.1%
Vietnam: +5.6%
Sri Lanka: +3.4%
Thailand: +3.2%

Source: ft.com

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