SMC shares buoy market out of the red

Stocks clambered up in robust trading on the strength of the gain on the foreign-flavored B shares of conglomerate San Miguel Corp., which single-handedly carried the market mostly out of the red during yesterday’s session.

The Phisix rose for the fourth consecutive trading day to 1,413.99, although the increase has been marginal – just 5.8 points or a mere 0.41 percent. The broader All-Shares index produced more steam, rising 12.01 points or 1.56 percent to 781.53 as stocks of the Canadian insurance giants continue to soar to record-highs.

Although there was still hesitation on most investors to play the market while the impeachment trial against President Estrada is ongoing, others took the occassion to load up and take early positions on choice blue chips such as San Miguel, ABS-CBN and Ayala Land.

SMC "B" dominated training with P2.069-billion worth or 77 percent of the total P2.697-billion turnover, its price adding P1 to P51.50. Its "A" shares were also heavily traded, staying put at 48.50.

Since it involved shares which are available to foreigners, a sizeable number of blocks of SMC B were traded by foreign brokers led by ABN-Amro, Jardine Fleming, Guoco, Merrill Lynch, BNP Paribas, WorldSec International and G.K. Goh Securities, along with local houses UCPB Securities, PCIB Securities, Capitol Securities and TIR Securities.

Analysts said a confluence of factors could have triggered the buying spree in SMC B, including its announced share buyback program of up to 10 percent of outstanding capital and the brewing negotiations for the re-acquisition of the local Coca-Cola bottling unit.

The food and beverage giant’s healthy income position, averaging at a 20-percent growth clip, and the slew of acquisitions (J. Boag & Son, Sugarland) along with programmed expansions such as the P10-billion logistics hub and wider exposure in the International market have also sweetened SMC’s appeal.

Last week, SMC chairman and CEO Eduardo Cojuangco Jr. stood firm in his decision to stick to his 20-percent personal stake in the company, indicating that other entities – including rival groups – could buy into San Miguel as soon as the government-sequestered 27 percent block gets auctioned off.

Aside from SMC, other blue chip gainers were ABS-CBN and its Philippine Deposit Receipts (PDRs), Ayala Land, Meralco B, First Philippine Holdings and Benpres Holdings.

Non-index heavyweights Sun Life and Manulife added P40 and P35, respectively to P1,165 and P1,455. Fairmont Holdings recovered from its losses to bounce back as one of the top gainers, going up eight centavos to P1.