Philippine Stocks Surge as Investors Cheer Iran's De-Escalation

The Philippine Stock Exchange Index (PSEi) climbed 0.97% to 6,506.8 on Tuesday as investors reacted positively to Iran's statement that it will not further escalate its conflict with Israel, easing concerns over higher oil prices. The broader All Shares Index also rose by 0.62%.

Investors were cheered by the positive sentiment from Wall Street as well. All subsectors gained, with industrial and property firms leading the advances. Top gainers included SM Prime Holdings, Ayala Land, and Jollibee Foods Corporation. Advancers outnumbered losers 102 to 73, with 51 companies closing unchanged.

Why this matters: The Philippine stock market's strong performance reflects easing geopolitical tensions and positive investor sentiment. The gains suggest improved confidence in the country's economic prospects and corporate earnings outlook.

SM Prime Holdings Inc, a major real estate company, has pushed back its plan to raise at least $1 billion through a listing of its real estate investment trust unit this year due to unfavorable market conditions, according to its president Jeffrey Lim. However, the company has enough capital to finance its expansion projects, including the $2.5 billion to $3 billion SM Smart City project in Pasay which is on track for completion by 2028.

Jollibee Foods Corporation announced that its Board of Directors approved a cash dividend of PHP 1.15 per share of common stock for all shareholders of record as of May 09, 2024, with an ex-dividend date of May 08, 2024 and a payment date of May 23, 2024.

The Philippine peso closed sideways, trading between 57.39 and 57.51 to the US dollar. Net value turnover was lower than the year-to-date average, and foreigners were net sellers.

The gains in the Philippine stock market mirrored the positive performance of US stocks, with the Dow Jones, S&P 500, and Nasdaq Composite all posting advances. Investors were reassured by Iran's de-escalation and the National Economic and Development Authority's statement that an uptick in Philippine inflation for April is unlikely. The strong showing by property developers SM Prime and Ayala Land, along with fast food giant Jollibee, helped drive the PSEi's nearly 1% increase to close at 6,506.8.

Key Takeaways

• PSEi climbed 0.97% to 6,506.8 on easing Middle East tensions.
• All subsectors gained, led by industrial and property firms.
• SM Prime deferred $1B REIT IPO due to unfavorable market conditions.
• Jollibee declared PHP 1.15 per share cash dividend.
• Philippine peso traded sideways, and foreigners were net sellers.