MANILA, Philippines — The Philippine Stock Exchange Index (PSEi) maintained its upward trend, notching a 0.71% increase, closing at 6,521.27, backed by a total value turnover of P4.2 billion.
Ayala Land Inc. (ALI) and BDO Unibank led the trading front, jointly accounting for 26.07% of the market weight. ALI soared to a new 52-week high, reaching P34.60.
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Meanwhile, foreign funds surged in net buying, reaching P395.0 million for the day.
The top five index gainers featured Central Azucarera de Tarlac leading the pack with a 3.44% increase. Following closely were BDO, JG Summit Holdings, Wilcon Depot, and Meralco, securing gains ranging between 2.13% and 3.44%.
The top five index decliners included Converge ICT Solutions, AC Energy Corp. (ACEN), Jollibee Foods Corp., Monde Nissin Corp., and SM Investments Corp., witnessing declines ranging from 0.99% to 2.74%.
ACEN hit a fresh 52-week low, reaching P4.18.
Most sectoral indices wrapped up the day on a positive note, except for Mining and Oil (-0.43%) and Holding Firms (-0.11%), which finished in the red.
At Tuesday's close, the PSEi reached 6,521.27, climbing by 45.77 points or 0.70%. Meanwhile, the All Shares index showed a gain of 16.57 points or 0.48%, settling at 3,432.71.
Houthi militants' actions pose threat to global trade
Attacks of the Iran-backed Houthi militants in the Red Sea posed a threat to global trade, stock broker AB Capital Securities said.
The stockbroker said it will make the shippers of commodities avoid passing through the Red Sea which will affect global trading routes.
They estimated that 12% of the world's trade flows, including 30% of global container traffic will be affected.
“The disruption is likely to trigger a domino effect on various industries, leading to inflationary repercussions. The inflationary pressures stem from the expected rise in shipping costs,” AB Capital Securities said in a statement.
Taking different routes will cost more and take longer, which might make things more expensive for consumers.
The increased risks due to the attacks and changes in shipping routes are causing insurance costs to rise. Shipping companies operating in high-risk zones might experience higher premiums as insurers modify their coverage policies.
“The immediate impact of these disruptions is keenly felt in the energy markets, particularly affecting oil and gas prices,” AB Capital Securities said.
“This, in turn, can have a cascading effect on various sectors of the economy, with implications for both businesses and consumers,” it added.
The Yemen-based militant group is targeting ships in the Red Sea as an act of "revenge" in response to Israel's attacks on Gaza.
Car sales thrive amid sluggish growth
The automotive sector witnessed a 7.6% year-on-year growth in vehicle sales for the month of November.
Despite the industry's positive momentum, it encountered challenges as month-on-month sales declined by 1.2%. The downturn revealed the subtle effects of recent increases in borrowing costs, specifically impacting car sales.
Commercial vehicle sales, however, registered a 7.7% increase driven by light commercial vehicles and Asian utility vehicles.
Passenger car sales also contributed to the overall positive trajectory, marking a 7.1% year-on-year increase despite its 5.14% decline on a month-to-month basis.
According to the latest data from the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) and the Truck Manufacturers Association (TMA), passenger car sales saw the most substantial growth rate, surging by 29% to reach 99,665 units.
Meanwhile, commercial vehicle sales experienced a notable increase of 22.2%, reaching a total of 290,989 units.
CAMPI president Rommel Gutierrez credited the surge in sales to the aggressive marketing efforts of all car brands.
“We already achieved 92 percent of our 2023 forecast in November; we may even exceed our sales forecast of 423,000 units if sales performance in the last three months is sustained,” Gutierrez said.
Year to date, the industry displayed a 23.9% growth in the first 11 months of 2023, reaching a total of 390,654 units. It set the stage for a potential breach of pre-pandemic sales levels, underscoring the sector's resilience amid challenges.
GT Capital Holdings Inc.' Toyota Motor Philippines Corp. maintained its dominant position with a substantial 46.2% share. Following closely were Mitsubishi Motors Philippines Corp. and Ford Motor Co. Phils., Inc.
According to AB Capital Securities' data, this marks the industry's slowest growth rate in 21 months, despite the increase in sales. The uptick in sales hints at a larger challenge connected to the delayed effects of high interest rates on consumer spending power.
However, the stockbroker also said that the anticipated decrease in interest rates in the coming year is seen as a key factor that could play a crucial role in revitalizing car sales.
“Projections indicate that the expected decline in interest rates in the forthcoming year could serve as a pivotal factor in rejuvenating car sales,” the stockbroker said.
“The anticipation of robust consumer spending signifies a favorable environment for the automotive market, hinting at a potential resurgence in demand for new vehicles,” it added. — with reports from Catherine Talavera and Iris Gonzales.