Market gets support from bargain hunters, PLDT gains

Share prices closed 1.1 percent higher yesterday, supported by bargain-hunting after a four-day downturn, dealers said.

Most interest was focused on market leader Philippine Long Distance Telephone Co. (PLDT) given expectations of strong 2005 earnings, with the stock bouncing back after heavy losses over the past two days following a Morgan Stanley downgrade.

The composite index gained 22.73 points at 2,083.65 after trading between 2,060.92 and 2,090.10. Volume was 916.16 million shares worth P1.49 billion.

The all-shares index was up 25.12 points at 976.33.

Gainers beat losers 53 to 20, with 52 stocks unchanged.

"I guess people realized that the sell-off was exaggerated. Bargain-hunters are back in," said Nestor Aguila of DA Market Securities.

There were concerns in the market that Moody’s Investors Service will keep its "negative" rating outlook on the country despite the government’s improved fiscal performance, said Astro del Castillo of First Grade Holdings Inc.

However, del Castillo said these concerns were outweighed by expectations that the next set of 2005 corporate results coming out shortly will be as healthy as the initial batch.

Ayala Land Inc. added 25 centavos at P11.

Food and beverage giant San Miguel Corp’s A shares fell 50 centavos to P62 while its B shares were steady at P84.50.

PLDT rose P70, or 4.26 percent, to P1,750, snapping a four-day, 11 percent decline. It plunged 6.2 percent yesterday, the biggest slide in more than three years, after the stock was downgraded to "equal-weight" from "over-weight" at Morgan Stanley on the outlook for earnings growth.

PLDT vice president Rogelio Quevedo said after the market closed that it will not agree to a Globe Telecom Inc. proposal to cut rates phone companies pay each other by as much as 83 percent. The proposal may hurt PLDT, which runs the nation’s largest landline and wireless networks, according to some analysts.

"If the interconnection charge reduction is forced by regulators on PLDT, the impact is disproportionately less than sellers of the stock imagine,’’ Junie Banaag, an equity fund adviser at First Metro Investment Corp. said in an e-mail last night. Banaag said investors should buy the stock, saying the company’s profit is not likely to fall this year.

Elsewhere, Ayala Land Inc., the nation’s largest developer, rose 25 centavos, or 2.3 percent, to P11. All 12 economists in a Bloomberg survey said the central bank won’t raise its key interest rate at its monthly monetary policy meeting today even after inflation picked up in January. A steady central bank rate may encourage banks to lower their lending rates, boosting borrowing for homes. – AFP