MANILA -- Positive sentiments on President Rodrigo R. Duterte’s statements in his third State of the Nation Address (SONA) lifted both the Philippine Stock Exchange index (PSEi) and the peso Tuesday.
PSEi recovered and went up 0.95 percent, or 70.22 points, to 7,447.02 points.
It was followed by the broader All Shares index, which increased by 0.71 percent, or 31.91 points, to 4,505.23 points.
Most of the sectors also gained and were led by the Mining and Oil, which increased by 2.23 percent.
Holding Firms came in second with 1.73 percent and tracked by the Services, 1.01 percent, Property, 0.95 percent, and Industrial, 0.11 percent.
Only the Financials index finished the day on the red after it declined by 0.28 percent.
Volume reached 2.65 billion shares amounting to PHP4.43 billion.
Advancers led decliners at 107 to 92 while 43 shares were unchanged.
Jonathan Ravelas, chief market strategist of the Sy-led BDO Unibank Inc., said in his tweet earlier in the day that “PRRD’s comment could provide a catalyst for equities to bounce.”
In an interview by PNA, he said the President’s decision to highlight in his SONA the importance of rice tariffication and tax reforms, among others, is a plus for investors’ positive outlook on the domestic economy.
“His speech showed that the current administration’s programs intend to really support the potential growth of the economy,” he said.
The President, in his speech, stressed his administration’s commitment for the passage of the proposed Comprehensive Tax Reform Program (CTRP) and asked lawmakers’ support for this bid.
He is hopeful to sign the second tax reform package, which is aimed at cutting corporate income tax (CIT) rates, before the end of this year, citing that this will be beneficial to small businesses and workers in this industry.
Before the SONA started there was an unprecedented event in the House of Representatives after House Speaker and Davao del Norte (1st District) Rep. Pantaleon Alvarez was ousted and was replaced by former president and now Pampanga (2nd District) Rep. Gloria Macapagal-Arroyo.
Ravelas said this is not worrisome to investors since it happened before in the Senate.
“The market has shrugged-off the impact and I’m not that alarmed regarding its dent on the market,” he said.
The BDO official said people have seen the President’s resolve and commitment to increase infrastructure spending and raise revenues and this is more important.
This, he said, is what is helping the domestic equities stay afloat.
“The challenge right now is to sustain the 7,500-level,” he said, noting the risks coming from rising inflation rate and weakening peso.
“There is a rally but the market remains vulnerable,” he added. (PNA)
