SHARES went up on Tuesday on last-minute bargain hunting and the government’s approval of the Public Service Act, which will allow full ownership in sectors like telecommunications to further liberalize the Philippine economy.
The benchmark Philippine Stock Exchange index (PSEi) climbed by 52.34 points or 0.75% to close at 7,008.94 on Tuesday, while the broader all shares rose by 18.16 points or 0.49% to 3,715.79.
“The local bourse jumped on last-minute bargain hunting. The signing of the law amending the Public Service Act also helped the market’s recovery for today,” Philstocks Financial Research Associate Claire T. Alviar said in a Viber message.
President Rodrigo R. Duterte on Monday signed Republic Act No. 11647, which amends the 85-year-old Public Service Act, excludes telecommunications, domestic shipping, railways and subways, airlines, expressways and tollways, and airports from the definition of a public utility. This means they will no longer be subject to the 40% foreign ownership cap for public utilities under the Constitution.
“During the earlier part of trading, the market was trading in the red amid Russia-Ukraine tensions and worries over the rising oil prices which soared once again following reports that the European Union is considering banning Russian oil. Aside from that, there was also negative spillover from the performance of the US markets overnight,” Ms. Alviar added.
Oil prices rose more than 7% on Monday, with global benchmark Brent soaring, as European Union nations disagreed on whether to join the United States in a Russian oil embargo after an attack on Saudi oil facilities, Reuters reported.
Brent futures was at $115.62 per barrel rising $7.69 or 7.12%, while US West Texas Intermediate crude futures closed at $112.12 per barrel up $7.42 or 7.09%.
“Philippine shares were bought up at close with investors speculating after Federal Reserve Chair Jerome Powell said the central bank is open to higher rate hikes to combat rising inflation,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
The US central bank must move “expeditiously” to bring too-high inflation to heel, Mr. Powell said on Monday, adding that it could use bigger-than-usual interest rate hikes if needed to do so, Reuters reported.
Majority of the sectoral indices ended in the green except for industrials, which dropped by 54.32 points or 0.58% to 9,277.27, and mining and oil, which fell by 48.38 points or 0.39% to 12,270.32.
Meanwhile, financials climbed by 33.86 points or 2.08% to 1,658.19; services went up by 24.55 points or 1.32% to 1,880.47; property increased by 22.08 points or 0.66% to 3,359.81; and holding firms gained 7 points or 0.10% to 6,651.62.
Value turnover decreased to P6.67 billion with 1.11 billion shares changing hands on Tuesday from P7.60 billion or 974.77 million issues seen the previous trading day.
Decliners outnumbered advancers, 81 versus 77, while 60 names closed unchanged.
Net foreign selling dropped to P838.47 million from P860.2 million on Monday. — L.M.J.C. Jocson with Reuters