Philippine Stock Market Wrap-up Report: October 23, 2018

Manila, Philippines – The Philippine Stock Market succumbed to profit-taking today after days of rally. The index closed at 7197.62, which is lower by 38.54 points or 0.53 percent.

The broader all-share index was lower by 0.34 percent.

Most of the sub-indices were lower except for the Holdings sub-index.

The worst performing sector is the Property sector, falling by 1.65 percent. Next to it is the Service sector, which dropped by 1.20 percent.

Within the Property sector, SMPH led the sub-index higher as it closed at 34.00. It was lower by 2.58 percent versus yesterday’s close.

Moreover, ALI ended the trade at 40.60, which is lower by 1.34 percent. MEG closed at 4.45, dropping at 1.11 percent. VLL locked at 5.26, a decrease of 2.59 percent.

Within the Service sector, TEL led the sub-index lower as it closed at 1376.00. The figure is lower by 2.48 percent versus yesterday’s close.

Meanwhile, BLOOM locked at 8.5 with a decline of 3.41 percent. ICT ended the day at 92.65, falling by 0.59 percent. RRHI closed at 48.75 with a 1.14 percent drop.

Gainers and Losers for the Day

The most active stocks today include SMPH with PHP 302.23 million in traded value. ALI made it to the top gainers with a traded value of PHP 276.96 million. SM also had PHP 246.91 million in traded value.

Significant gainers for the day include MHC, increasing by 17.31 percent, EDC by 11.49 percent, VUL by 8.27 percent, TBGI by 5.66 percent, and EEI by 5.26 percent.

On the other hand, the notable losers include X, falling by 8.42 percent, ECP by 7.14 percent, and NOW by 4.93 percent.

Market Breadth

There were 74 advances and 120 declines, while 40 names remain unchanged. Value turnover totaled PHP 4.37 billion. Foreign exchange rate stood at USD 1: PHP 53.79.

Budget Deficit Almost at 100 Percent of Target

On Monday, the Bureau of Treasury (BTr) stated that spending continues to outrun an increase in revenues.

The budget deficit totaled PHP 378.20 billion for the first nine months of the year. This figure is a 78 percent increase versus the same period in 2017.

At the same time, it is a five percent deficit from the full 9-month target of PHP 396.60 billion.

Revenues for the first nine months totaled PHP 2.11 trillion, a 17 percent growth versus the same period last year. It is also beyond the PHP 2.03 trillion, a four percent outperformance.

Most of the revenues or around 90 percent came from taxes totaling PHP 1.90 trillion. This figure is 16 percent higher versus last year but is a bit short of the PHP 1.91 trillion target.

The Bureau of Internal Revenue got majority of the tax collections at PHP 1.44 trillion. This amount is an 11 percent increase but is also short of the PHP 1.47 trillion target.

On the other hand, the Bureau of Customs collected PHP 434.60 billion, a 34 percent increase versus last year. It is 4 percent beyond the target at PHP 417.50 billion target.

Other offices accounted for PHP 16.7 billion, which is higher by 5 percent from the same comparable period.

Non-tax revenues totaled 10 percent of overall revenues for the first nine months at PHP 216.10 billion. It is a 33 percent increase versus last year and is 72 percent higher than the PHP 125.5 billion target.

Subsequently, disbursements for the first nine months grew by 24 percent at PHP 2.49 trillion from only PHP 2.01 trillion last year.

Most of the expenses came from other expenditures. It takes into account capital outlays and infrastructure spending totaling PHP 2.218 trillion.

This figure is 26 percent higher versus last year, which is three percent beyond the target of PHP 2.146 trillion. It accounts for 89 percent of total disbursements.

Furthermore, interest payments totaled PHP 271.30 billion, a nine percent increase but are lower than the expected PHP 281 billion.

For September alone, the fiscal deficit reached PHP 96.20 billion. It is more than double versus the PHP 36.9 billion recorded in the same month in 2017.

Index Pulls Back

The index appears to pull back after five straight days of green candles. So far, the 15 EMA and 20 SMA act as support while the 50 SMA may act as resistance.

It is best if the index could mark a higher low so it would be ripe for another higher high set up. MACD is already bullish.

RSI is also bullish but is not yet at overbought levels. Estimated support is at 7143 while expected resistance is at 7355.

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