PSE index up 1% on optimism over recovery

Philippine stocks rose after Intel Corp. reported record second-quarter profit and Singapore raised its 2010 economic growth forecast, driving optimism that the global economy is recovering. The Philippine Stocks Exchange index closed at 3,472.33 points, gaining 36.48 points or 1.06 percent. This connotes a new high since ending at 3,447.29 points on Jan. 15, 2008. More than 2.75 billion shares valued at P2.96 billion changed hands. Advancers outpaced decliners 56 to 25, and 54 stocks were unchanged. Intel, the world's biggest chipmaker, posted a net income of $2.9 billion in the second quarter, a turnaround from the $398-million loss that the company reported in the same period last year. Also, Singapore foresees its economy growing between 13 percent and 15 percent this year. The positive prospect for the economy of Singapore — an export-led economy like the Philippines — adds optimism to the world's recovery, after Greece sold bonds at a rate below what the country pays for European aid, said Jose Vistan, senior research manager of AB Capital Securities Inc. He said Singapore's dependence on global trade may mean it's likely to escape the impact of any renewed slowdown. "That would translate to the country's very conducive business environment, considering our low inflation rate, our low earning rate, etc. We have a positive outlook both on microeconomics and macroeconomics," Vistan said. Intel's sales growth, he said, would also ripple to our "booming" economy. "Manufacturing sector is the biggest employer to our Filipino workers," he added. Intel said its third-quarter sales will be $11.6 billion. —VS, GMANews.TV