Market soars to new record high

MANILA, Philippines - The local stock market reverted to bullish mode yesterday, soaring to its 35th record close amid optimism US lawmakers will reach a budget agreement soon.

The main benchmark index surged 75.92 points or 1.33 percent to finish at 5,763.64 as investors snapped up shares of companies in the services, property and financial services sectors.

A total of 4.46 billion shares valued at P11.45 billion changed hands yesterday.

Among the gainers were Philippine Long Distance Telephone Co. which rose 2.76 percent to P2,610 per share; Banco De Oro, up 3.95 percent at P76.30; Megaworld, up 4.85 percent at P2.81 and Metrobank, up 2.12 percent at P101.30.

Accord Capital Equities Inc.’s Jun Calaycay said the latest inflation number, which came in at a slower 2.8 percent year on year, also boosted market sentiment. The figure was an improvement from October’s 3.1-percent pace and  brings the year-to-date change in the general price level to 3.16 percent, well within the BSP’s target band.

“This has raised the prospects of another rate cut when the Monetary Board meets for the last time this year on the 13th. Over the first 11 months, domestic policy rates have been cut four times by a total of 100 basis points to a record low of 3.5 percent and 5.5 percent for overnight borrowing and lending, respectively.

The continuing European debt crisis and the market’s overbought level remain a thorny issue among investors.

Calaycay said a pull-back to the initial support lines at 5,630 and 5,580 should reignite a more aggressive buying stance.