PHILIPPINE SHARES closed in the green on Monday on bargain hunting ahead of the Holy Week break and improved sentiment following the signing of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.
The benchmark Philippine Stock Exchange index (PSEi) gained 63.15 points or 0.96% to close at 6,607.78 on Monday, while the broader all shares index went up by 20.30 points or 0.51% to 3,988.09.
“The market proved its resiliency as it ended higher despite starting the day with a substantial loss. The tightening of quarantine restrictions caused some panic selling at the open, however, buyers were quick to come in and pick up shares at cheaper prices,” Christopher John J. Mangun, research head at AAA Southeast Equities, Inc., said via e-mail.
“The optimism may be coming from the government’s commitment to the economy’s recovery despite the recent setback,” Mr. Mangun added.
Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said bargain hunters took advantage of the market’s decline earlier on Monday and from the previous trading day.
“Malacañang’s signing of the CREATE Act into law also helped spur optimism in Monday’s trading,” Mr. Tantiangco added.
The CREATE Law, signed by President Rodrigo R. Duterte on Friday, reduces the country’s corporate income tax rate to 25% from 30%. It will further slash the rate by a percentage point every year from 2023 to 2027 until it reaches 20%.
Mr. Duterte vetoed some sections of the measure, including one that allows incumbent and future presidents to exempt an investment promotion agency from CREATE’s coverage and another section that increases the threshold of low-cost housing eligible for value-added tax exemption to P4.3 million from P2.5 million.
Majority of the PSE’s sectoral indices closed in the green on Monday, except for mining and oil, which declined by 42.99 points or 0.49% to 8,590.95; and industrials, which fell by 25.22 points or 0.29% to 8,565.50.
Meanwhile, property increased by 72.45 points or 2.21% to finish at 3,349.41; financials went up by 19.05 points or 1.35% to 1,420.69; holding firms gained 38.02 points or 0.57% to 6,643.42; and services rose by 4.75 points or 0.33 to close at 1,440.73.
Value turnover increased to P7.27 billion on Monday with 2.88 billion shares switching hands, from the P6.28 billion with 4.91 billion issues traded on Friday.
Decliners outnumbered advancers, 116 against 97, while 44 names closed unchanged.
Foreigners turned buyers, with net inflows amounting to P30.43 million on Monday, versus the P724.71 million in net foreign outflows logged on Friday.
“Despite the gains, we are not out of the woods yet as the main index is coming up against resistance at 6,600 to 6,700,” AAA Southeast Equities’ Mr. Mangun said. “We may see it give back some gains in the coming days.” — Keren Concepcion G. Valmonte