PSE Index Regains Loss

The Philippine Stock Exchange (PSE) index today regained lost ground finishing up at 6,469.72 points, up by 64.81 points or 1.01 percent on assurance from the Bangko Sentral ng Pilipinas that the banking system is healthy following the unraveling of the US banking system.

Photo Insert: The Philippine Stock Exchange (PSE) Index, March 17, 2023

The latter was gripped by fears consequent to substantial losses of banks for their bond holdings that showed their losses based on mark-to-market rules.

BDO Unibank posted a hefty gain of 5.02 percent to close at P127.60, up by P6.10 on trades of P497 million, the second most active stock, while Metrobank went up by 2.50 percent to P57.40, a gain of P71.40.

Security Bank also rose by 95 centavos to P93 while East West Bank by 18 centavos to P7.06. Bank of PI though, went down by P1.70 to P101.20.

As a result, financials posted the biggest gain among the sub-indices at 1.75 percent while holding firms rose by 1.66 percent, services by 0.38 percent, industrials by 0.04 percent, property by 0.18 percent, and mining and oil by 0.73 percent.

ICTSI was the day's most active stock with trades of P811 million as it ended the day unchanged at P198 while Ayala Land was the third most active stock with trades of P484 million as it lost by 10 centavos to P28.20.

SM Prime was unchanged at P34 and Robinsons Land posted a gain of 12 centavos to P13.52. Other gainers were PLDT up by P10 to P1,310, Jollibee Foods up P8 to P223, Universal Robina up P1.20 to P142, Globe Telecom up P10 to P1,740, Megaworld up 4 centavos to P1.96, and Semirara Mining up 65 centavos to P30.75.

The assurance from Bangko Sentral Governor Felipe Medalla that the Philippine banks are insulated from the losses that hit hard the US banking industry with the collapse of the Silicon Valley Bank and Signature Bank, plus the edgy handling of Credit Suisse somehow assured investors in the Philippine Stock Exchange that all's well in the banking industry.

There have been fears of a contagion that could hit US banking due to the losses in the bond holdings that US banks own with the rise in interest rates that the US Fed made to battle an inflation spiral.

This resulted in considerable losses for the treasury bonds that SVB and others hold which meant huge losses as the bonds have very low interest rates of up to below one percent.

The fear of contagion has already resulted in a big drop in the offer price of Upson International's IPO where it reduced its offering by 56 percent to P2.40 per share price against a maximum price then set of P5.50.

The PSE index's recovery though is seen to bolster enthusiasm once again in the market unlike in the selldown last Tuesday where the index was just 50 points away from its support price of 6,350 points.

Value turnover was a third higher at P8.5 billion with 102 gainers, 79 losers, and 57 shares unchanged.

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