Market bucks regional trend, closes at new high

MANILA, Philippines - Local stocks defied a regional downtrend yesterday as the main index swung to a fresh all-time high, aided by a last minute burst of buying in blue chip issues.

After trading in the red for most of the session, the benchmark Philippine Stock Exchange index (PSEi) spurted in the final hour to finish 14.28 points or 0.28 percent higher at a record 5,030.58, reversing earlier profit-taking pressures due to long-running debt woes in the eurozone as well as surging oil prices.

A total of 5.01 billion shares valued at P5.51 billion changed hands yesterday.

Advancers outpaced decliners, 92 to 71, while 40 stocks were unchanged.

Among the index stocks, Ayala Land and parent firm Ayala Corp. posted huge gains of 5.24 percent and 1.65 percent, respectively, to close at P22.10 and P431 each.

Other stocks that perked up the PSEi were ICTSI, Manila Water and San Miguel.

All sub-indices moved higher expect the financial index as investors cashed in on gains in Metrobank, Banco De Oro and Bank of the Philippine Islands.

Accord Capital Equities analyst Jun Calaycay said investors remain watchful of developments overseas as they have yet to see more evidence of firmer global growth.

Meanwhile, interest rates of Treasury bills are expected to rise by 10 to 15 basis points after the Bangko Sentral ng Pilipinas (BSP) said inflation could have eased in February.

Around the region, major Asian stock markets fell as tough talk by US President Obama over Iran’s nuclear program and uncertainty over Greece’s ability to clear the next hurdle in its debt reduction plan unnerved investors.

Japan’s Nikkei 225 index fell 0.5 percent to 9,731.82 and South Korea’s Kospi dropped one percent to 2,014.16. Hong Kong’s Hang Seng lost 1.1 percent to 21,319.32 and Australia’s S&P/ASX 200 shed 0.4 percent to 4,254.90.

In a speech Sunday, Obama said he would not hesitate to attack Iran to keep it from getting a nuclear bomb, hoping to dissuade Israel from launching a unilateral strike that could ignite a Middle East war.

But he also pleaded for time for diplomacy to work, stressing that military force was a last resort, not the next option at a time when sanctions are squeezing Iran.

Still, markets reacted nervously to the message that force remains an option.

“Markets are likely to begin the week in cautious mood on the back of US President Obama’s tough speech on Iran nuclear problem,” analysts at Credit Agricole CIB in Hong Kong said in an email.

Uncertainly over a definitive solution to Greece’s long-standing debt crisis also kept investors at bay.

The Greek Finance Ministry says the country’s debt-reducing bond swap with private creditors is expected to take place on March 12. At least 66 percent of private sector bondholders must be willing to participate in the deal, the minimum number to make the deal viable.

Athens last week took the first concrete steps toward making sure that a small number of holdouts cannot scupper the deal. The Greek parliament is expected to introduce so-called collective action clauses, which would force holdouts to participate in the bond swap as long as a majority of investors approve.

Louis Wong, director of Phillip Securities Ltd. in Hong Kong, said markets were in a holding pattern head of the release of US jobs data for February on Friday and a meeting Thursday of the European Central Bank, which is under pressure to reduce interest rates to help a waning eurozone economy.

“The market is taking a pause after the recent rally,” Wong said. “Various central banks are having their interest rate meetings this week, and also the US will release a batch of economic data.”

On Wall Street on Friday both the Dow and Nasdaq retreated from highs hit earlier in the week.

The Dow Jones industrial average fell marginally to close at 12,977.57. The Standard & Poor’s 500 index shed 0.3 percent to close at 1,369.63. The Nasdaq composite average eased 0.4 percent to 2,976.19. – with AP