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PHILIPPINE stocks rose Friday after President Gloria
Arroyo pardoned her predecessor Joseph Estrada, easing
concerns political instability would diminish the appeal
of the country’s assets to investors.
Ayala
Corp., owner of the nation’s biggest bank by market
value, and SM Investments Corp. led the advance. Philex
Mining Corp., the largest mining company by market
value, gained after the price of gold rose to a 27-year
high.
Granting
Estrada a pardon “lessens uncertainty for investors in
the Philippines,’’ said Allan Yu, who helps manage the
equivalent of $3.17 billion at Metropolitan Bank & Trust
Co. “It will allow the government to keep its focus on
expanding the economy.’’
The
Philippine Stock Exchange index gained 17.10, or 0.5
percent, to close at 3,784.88. Gainers outnumbered
decliners 69 to 44, while 60 companies were unchanged in
the broader market. The benchmark lost 0.9 percent this
week.
Ayala
climbed P15, or 2.5 percent, to P615. SM Investments
added P5, or 1.4 percent, to P375.
Estrada,
70, was pardoned more than a month after being convicted
and sentenced to life imprisonment on charges including
receiving P545 million in payoffs from illegal gambling
operators during his time as president.
Estrada’s allies in the House of Representatives have
tried and failed to impeach President Arroyo twice.
Granting the pardon may allow her to win support of her
predecessor’s allies, said Earl Parreño, an analyst at
the Institute for Political and Economic Reforms, on
October 22.
Philex,
which exports gold and copper, gained 50 centavos, or
5.4 percent, to P9.8 after the price of gold rose to its
highest since January 1980.
Gold for
immediate delivery rose $5.83, or 0.8 percent, to
$775.13 an ounce as of noon trading Friday in Manila.
Class A
shares of Lepanto Consolidated Mining Co., equity
reserved for Filipinos in the
Philippines’
second-biggest mining company by market value, gained 1
centavo, or 3 percent, to 34 centavos. Class B shares of
Lepanto, which have no ownership restrictions, gained 1
centavo, or 2.8 percent, 37 centavos.
---Bloomberg
*****
Peso holds near 7-yr high
By Karl Lester M. Yap
Bloomberg
THE
Philippine peso held near a seven-year high Friday on
optimism the pardon of convicted ex-President Joseph
Estrada will give investors more confidence to buy the
nation’s assets as the political climate stabilizes.
Bonds rose.
The
currency completed a weekly gain after President Gloria
Arroyo Thursday pardoned Estrada, who was convicted last
month and sentenced to life imprisonment for corruption.
The peso is the best performer this month of the 10
most-actively traded Asian currencies outside Japan.
“People
are trying to push the peso higher,’’ said Ricky Cebrero,
treasurer at East West Banking Corp. “With the release
of Estrada, the political uncertainty diminished since
it is unlikely his supporters will create more
instability.’’
The peso
gained 0.4 percent last week to P44.055 against the
dollar, according to Tullett Prebon Plc., the world’s
second-largest interdealer broker. The currency rose as
high as P44 per dollar Thursday, the strongest since
July 2000. It was little changed Friday.
Government bonds advanced, pushing the yield of the
benchmark 10-year note to the lowest in two weeks.
The
yield on the 7-3/4-percent note due August 2017 fell 3
basis points to 7.15 percent at the
noon fixing at Philippine Dealing & Exchange Corp. That is the
lowest since October 11. The price rose 0.2022, or P22
per P10,000 face amount, to 104.1643. A basis point is
0.01 percentage point.
The
perceived risk of owning Philippine sovereign bonds
declined, according to credit-default swaps.
The cost
to protect $10 million of debt from default for five
years is equivalent to $138,500. |
