(UPDATED) Local share prices resume surge as investors hunt for bargains

Local share prices resumed their surge on Monday after cash-rich investors took advantage of the recent lull by hunting for blue-chip bargains. Expectations of better-than-expected first-quarter corporate earnings also pushed the Philippine Stock Exchange index to a fresh two-year record of 3,294.83 points, less than 6 points shy of the psychological 3,300 level. The composite index briefly touched 3,300 but retreated later, gaining 1.19 percent or 38.71 points. It was the index’s highest close since February 4, 2008, when it finished at 3,323.25 points. "Today’s results [were mostly brought about by] the Dow’s rise last Friday... We also joined in cheering what appears to be a solution to Greece’s debt problem, with the European Union and International Monetary Fund coming together with a $45-billion package," Justino B. Calaycay Jr. of Accord Capital Equities Corp. said in an interview. On the local front, he added, companies continue to report good earnings for last year. "There is nothing on the domestic front that might raise concerns, at least not on the economic and financial sides," he pointed out. The analyst said much of the concern is political, particularly about the upcoming elections. He said the index would likely finish at 3,300 points in the coming days. "But whether we can sustain that in the next week or two is still in question," he pointed out, adding that the market was surging now in anticipation of better economic conditions. "The fundamentals are good, but I’m not sure these support the level the market has gone to now. There has to be some corrective action," Calaycay said. Online brokerage 2TradeAsia said the stock market might become volatile in the weeks ahead, with less than a month before the May 10 elections. "Attention could seesaw between economic and political headlines," it said, adding that investors might pay more attention to the latter. "In this light, it might be prudent to balance portfolios in favor of defensive bets, as traders weigh the odds relative to the new administration’s resolve in upholding existing political laws, versus the probability of altering rules with the new political team’s composition and priority basket," it added. Gainers beat losers 64 to 41, while 65 stocks were unchanged. Volume turnover was brisk, with 1.22 billion stocks worth P4.24 billion being traded. Foreigners bought P278.24 million worth of stocks more than they sold, PSE data showed. Subindices rose across the board, led by property companies, which soared by 2.78 percent or 33.33 points to finish at 1,231.29. Holding firms also went up by 1.15 percent or 23.62 points to 2,074.26, while services gained 0.97 percent or 14.41 points to 1,499.61. Financial stocks likewise advanced by 0.94 percent or 6.55 points to 703.65, while the mining and oil index added 0.58 percent or 55.77 points to close at 9.622.12. Industrial stocks gained 0.51 percent or 25.26 points to 4,980.14. SM Investments Corp., the day’s most active stock, increased by P10 to P402.50, while Ayala Corp. gained P5 to finish at P352.50. Dominant carrier Philippine Long Distance Telephone Co. went up by P45 to P2,535, while Bank of the Philippine Islands gained 50 centavos to P46. Universal Robina Corp. lost a peso to P25, while Metro Pacific Investments Corp. shed five centavos to P3.05. Metropolitan Bankd and Trust Co. and First Gen Corp. were steady at P50.50 and P10.75, respectively. — Norman P. Aquino, GMANews.TV