Economy · August 4, 2022

PSEi strengthens with positive earnings reports

The Philippine Stock Exchange (PSE) climbed 67.78 points again Wednesday to close at 6,430.08.

Claire Alviar, Research Associate of Philstocks Financial Inc., and Rizal Commercial Banking Corp. Chief Economist Michael Ricafort said the good earnings reports of the index members boosted market sentiment.

“The heavyweight companies’ earnings, especially SM Investments Corp.’s 3.38 percent revenue increase, helped lift the PSEi,” Alviar said.

Ricafort added that the market also took into account the signal from Bangko Sentral ng Pilipinas governor, Felipe Medalla, that inflation may have peaked in July 2022 and took into account the official rate hike of 25-50. basis points on August 18, 2022.

Alviar pointed out that as the market broke through its 6,400 resistance level, he will test the sustainability of that benchmark in the next few days. If the market rises above 6,400, the next indicator is 6,600.

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In the US, Regina Capital Development Corp. Chief Executive Luis Limlingan said investors have moved away from US markets as House Speaker Nancy Pelosi’s controversial visit to Taiwan added to already strained US-China relations. Equities also fell further after three Federal Reserve presidents hinted that further rate hikes were needed to fight high inflation.

For local catalysts, investors await the release of the PH CPI (Philippine Consumer Price Index) on Friday and continue to be led by the release of further earnings reports.

Oil prices are on the upward trajectory again. Limlingan said oil futures rose ahead of an OPEC + producers meeting this week which may not lead to an increase in crude oil supply amid concerns that a possible global recession could limit energy demand. Brent futures rose 51 cents to settle at $ 100.54 a barrel, while US West Texas Intermediate crude rose 53 cents to $ 94.42 a barrel.

Market volume grew, with net sales of £ 6.09 billion, the highest from £ 6.27 billion on 8 July.

The total volume today was 502,366,276 shares.

Sectors were mixed as holdings posted the largest gain of 2.06%, while mining and oil lost more than 1.10%.

The bears beat the advances, 89 to 88, while 52 stocks remained unchanged.