Stocks extend rally as investors pick up bargains

PHILIPPINE SHARES extended their rally on Thursday on bargain hunting and ahead of the release of July inflation data.

The 30-member Philippine Stock Exchange index (PSEi) rose by 53.03 points or 0.82% to close at 6,483.11 on Thursday, while the broader all shares index increased by 24.93 points or 0.72% to 3,461.76.

“Philippine shares [were] bought as investors picked up heavily beaten stocks ahead of the latest CPI (consumer price index) print [on Friday] and with the rising US-China tensions at the backseat,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“The local bourse rallied once again, up by 53.03 points [or] 0.82%, to 6,483.11 as foreigners continued to bargain hunt, registering a net buying of P315.55 [million],” Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message.

“Stocks in the US gained overnight as the view on the US economy improved following the strong ISM (Institute for Supply Management) non-manufacturing PMI (Purchasing Managers’ Index),” Ms. Alviar added.

The US service sector unexpectedly recovered in July, with strong new orders, supporting the view that the economy is not in recession despite the weak output in the first half of the year, Reuters reported.

The ISM’s non-manufacturing PMI ended three consecutive months of decline with a reading of 56.7 last month from 55.3 in June. A figure above 50 points to an expansion in the services sector that accounts for more than two-thirds of US economic activity.

Back home, all sectoral indices ended in the green on Thursday. Services climbed by 22.40 points or 1.33% to 1,699.92; industrials went up by 101.94 points or 1.07% to 9,609.50; property rose by 24.53 points or 0.85% to 2,908.24; financials increased by 11.39 points or 0.75% to 1,524.74; holding firms added 17.97 points or 0.29% to end at 6,155.58; and mining and oil gained 20.47 points or 0.17% to 11,609.09.

Value turnover went down to P5.84 billion on Thursday with 591.26 million shares changing hands from P6.52 billion with 502.37 million issues seen on Wednesday.

Advancers outnumbered decliners, 98 versus 78, while 49 names closed unchanged.

Net foreign buying went down to P315.55 million on Thursday from the P726.48 million seen the previous trading day.

“I think that overall market sentiment is slowly turning bullish as investors saw foreign flows coming in the PSEi,” Mercantile Securities Corp. Head Trader Jeff Radley C. See said in a Viber message.

Mr. See placed the PSEi’s support between 6,200 and 6,350 and resistance at 6,500-6,800, while Philstocks’ Ms. Alviar put support at 6,100-6,150 and resistance at 6,400. — Justine Irish D. Tabile with Reuters