052207: Philippine stocks rise to record for 2nd day

By Ian C. Sayson

Bloomberg

PHILIPPINE stocks Monday rose, lifting the index to a second-straight record, on speculation last week’s elections reduced the risk President Gloria Macapagal-Arroyo will face another impeachment attempt, allowing her administration to focus policy on economic growth and ending years of deficits. Ayala Land Inc., the nation’s largest builder, advanced to a 10-year high. Manila Electric Co. (Meralco) the biggest power producer, climbed to its highest since 1994. “The elections have tempered the risks and the market is experiencing a rerating,” said Rico Gomez, who helps manage about $1 billion at Rizal Commercial Banking Corp. in Manila. “There is more confidence government programs will stay on course.” Metropolitan Bank & Trust Co. led lenders higher after the central bank said stricter capital rules will spur more mergers among the nation’s big banks. The Philippine Stock Exchange index added 17.16, or 0.5 percent, to 3466.34 at the close. Gainers beat losers 71 to 33 in the broader market, while 55 stocks were unchanged. The nation’s stock benchmark also closed at a high on May 18, following a 3.2 percent, five-day climb. The index has gained 16 percent in 2007, after almost tripling in the previous four years. Ayala Land gained 25 centavos, or 1.6 percent, to P15.50, its highest since September 18, 1996. Megaworld Corp., a builder of resident and office towers, climbed 15 centavos, or 3.8 percent, to P4.10, its highest since August 23, 1996. Class A shares of Meralco, equity reserved for Filipinos in the power producer, climbed P2, or 2.3 percent, to P89, its highest close since November 16, 1994. Its Class B shares, which have no ownership restrictions, gained P2, or 2.3 percent, to P89.50, following a two-day, 13-percent advance.  Balanced by 2008? THE Philippines held mid-term elections last week and Mrs. Arroyo said her allies are likely to get a bigger majority in the House of Representatives. Retaining more than two thirds of the House diminishes the likelihood Mrs. Arroyo’s political opponents can succeed in getting her out of office. Mrs. Arroyo, who defeated two impeachment bids in her six years in office, has vowed to balance the budget in 2008, after 10 years of deficits. Finance Secretary Gary Teves said May 18 after the market closed that that the nation in April had its second budget surplus this year.

 

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