The Philippines is one of the best performing stock markets in Asia, after breaking new record highs two times this week.
On Tuesday, the PSEi finished at a fresh record high of 8,312.93. On Wednesday, the benchmark index scaled new heights surpassing the previous day’s high to close at 8,344.05.
The investor euphoria continued throughout the week as the benchmark Philippine Stock Exchange index soared to an intra-day record above the 8,400 mark on Friday but at end of the trading day closed at 8,310.88.
Philippine stocks are rising due to several factors – investors are taking their cue from upbeat US economic data and record highs on Wall Street. Investors continue to remain bullish about the prospects of the Philippine economy, expectations of a tax overhaul and government’s plan to liberalize foreign ownership restrictions in highly regulated industries is further bringing good tidings to the market.
The proposed tax reform measures include expanding the value-added tax base, raising excise taxes on fuel and automobiles, and slap levies on sugar-sweetened beverages will add billions of pesos into the government’s coffers.
On growth, the government has set a full year growth target of 6.5 percent to 7.5 percent for 2017. The local economy accelerated 6.5 percent in the second quarter, mainly due to higher government spending, strong domestic demand, and increased farm output.
Local stocks are being led by financial, industrial, services, holding companies and mining issues.
VC Securities president Wilhemino Agregado said the PSEi would likely end at around 8,500 this year, adding that many investors were now positioning for the local stock barometer to reach 10,000 by next year.