Local shares inch up on banks’ strong Q1 reports

Philippine shares inched higher on Thursday amid strong earnings reports and as the national government’s budget gap narrowed last month. 

The Philippine Stock Exchange index (PSEi) rose by 0.03% or 2.13 points to end at 6,574.88 on Thursday, while the broader all shares index went up by 0.13% or 4.51 points to close at 3,467.97. 

“This Thursday, the local market inched up by 2.13 points (0.03%) to 6,574.88. Investors are looking forward to further first-quarter earnings results as initial reports from the banking space were positive. Additionally, the narrowing of the country’s budget deficit last March was cheered,” Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said in a Viber message 

“Many seem to have stayed on the sidelines, however, amid the lack of positive catalysts,” Mr. Plopenio said. 

Value turnover dropped to PHP 3.90 billion on Thursday with 752.87 million issues switching hands from the PHP 6.07 billion with 1.13 billion issues traded on Wednesday. 

“The recent market bounce is looking exhausted, even with the strong earnings kick-off led by the banks, and that’s because investors are selling the rally as they lighten up on equities and shift funds to haven assets like cash, sovereign bonds, gold,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message. 

BDO Unibank, Inc. reported last week that its net income grew by 12% year on year to PHP 18.5 billion in the first quarter as its core businesses remained strong. 

Bank of the Philippine Islands saw its net income climb by 25.8% to PHP 15.3 billion last quarter as higher revenues offset increased provisions and expenses, it reported this week. 

Meanwhile, the country’s budget deficit narrowed by 6.82% to PHP 195.9 billion in March from P210.3 billion in the same month a year ago, data from the Bureau of the Treasury showed. 

The PSEi moved sideways as investors awaited the release of US gross domestic product (GDP) data for the first quarter, AB Capital Securities, Inc. Vice-President Jovis L. Vistan said in a Viber message. 

“Essentially, the GDP report serves as a barometer for economic health, offering insights on inflation concerns and expectations regarding the future interest rate adjustments by central banks,” he said. “The anticipation surrounding the GDP report is heightened due to its implications for monetary policy decisions.” 

Majority of sectoral indices ended higher. Mining and oil climbed by 2.74% or 235.53 points to 8,823.06; industrials went up by 0.65% or 56.80 points to 8,691.75; financials rose by 0.19% or 3.95 points to 2,049.85; and holding firms gained by 0.14% or 8.66 points to end at 6,068.13. 

Meanwhile, property dropped by 0.60% or 15.26 points to 2,503.84 and services lost 0.18% or 3.48 points to end at 1,836.37. 

Advancers beat decliners, 104 against 83, while 50 names closed unchanged. 

Net foreign buying reached PHP 127.24 million on Thursday versus the PHP 1.86 billion in net selling seen on Wednesday. — RMDO