Local shares open higher due to bargain-hunting

MANILA (AFP) - Philippine shares opened higher Friday as bargain hunters moved in on the back of the fallout from the US sub-prime mortgage market crisis, dealers said.

The composite index was up 40.35 points or 1.37 percent at 2,982 about 15 minutes into the session.

On Thursday, Manila's main index posted its biggest single-day rout since February 28 when a selloff was triggered by the plunge in Chinese markets.

The market ended Thursday down 188.03 points or 6.0 percent at 2,942.31, much deeper than the previous day's decline of 4.1 percent.

Local stocks have been pounded most of the week on worries about tightening credit and the fallout from the crisis in US sub-prime mortgages.

Dealers said local stocks are now considered ripe for a technical rebound.

"The market has given up all its gains for the year, it is now close to end-2006 levels so stocks now are attractive as they were since the start of the year," said Francisco Liboro, president of PCCI Securities.

"For the savvy investors, this would be a good time to pick stocks," he added.
"The market has very good value as can be gleaned from corporate earnings, even the large cap stocks have become very cheap."

Liboro said gains may be limited as global equities are still shaky given the uncertainty of the credit crisis in the United States.

"Until US stocks stabilize, I don't think we can expect any sustainable rebound and consolidation in the near term, the market will continue to be held hostage by the US markets."