PHILIPPINE shares rebounded on Tuesday as investors went bargain hunting and following the release of earnings reports of index-member firms.
The Philippine Stock Exchange index (PSEi) went up by 40.56 points or 0.56% to close at 7,252.10 on Tuesday, while the all shares index gained 19.68 points or 0.44% to end the session at 4,456.52.
“Corporate earnings [reports are] coming out strong and giving market a lift,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message.
“Philippine shares rebounded on bargain hunting as investors digested new earnings from index names, with [BDO Unibank, Inc. (BDO) and Manila Electric Co. (Meralco)] being the latest to report, while awaiting the next batch companies reporting,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a separate Viber message.
BDO’s net income declined by 10.6% in the third quarter to P11.033 billion. Still, its nine-month profit surged by 95.7% to P32.484 billion from P16.598 billion the year prior.
Meanwhile, Meralco reported a 29.7% growth in its core net income to P6.66 billion driven by higher energy sales as the country eased quarantine restrictions.
“On the other hand, the Philippine budget deficit rose 29.61% [year on year] to P1.14 trillion in [the nine-month period ending September], reflecting the accelerated borrowings to finance the [national government’s] COVID-19 (coronavirus disease 2019) response program,” Mr. Limlingan added.
The government’s budget deficit widened in September as spending outpaced a smaller increase in revenue collection, the Bureau of the Treasury reported on Monday.
The fiscal gap expanded by 30% to P180.9 billion in September from P138.5 billion a year earlier. The figure was also 49.6% higher than the P120.9-billion deficit in August.
The government runs on a budget deficit when it spends more than it makes to fund programs that support economic growth. It borrows from foreign and local sources to plug the gap.
Majority of sectoral indices posted gains on Tuesday except for property, which lost 40.12 points or 1.22% to end at 3,232.04.
Meanwhile, services rose by 35.60 points or 1.89% to 1,914.04; industrials climbed 106.79 points or 1% to 10,751.40; financials gained 8.14 points or 0.52% to 1,563.89; mining and oil improved by 50.38 points or 0.48% to close at 10,506.47; and holding firms went up by 25.17 points or 0.34% to 7,238.85.
Value turnover rose to P6.43 billion with 834.55 million shares switching hands on Tuesday, up from the P5.57 billion with 913.57 million issues traded the previous day.
Decliners outperformed advancers, 110 against 89, as 52 names closed unchanged.
Net foreign purchases surged to P127.74 million on Tuesday, higher than the P79.74 million seen on Monday. — Keren Concepcion G. Valmonte