Shares end 2021 on positive note after budget signing

shares end 2021 on positive note after budget signing - Shares end 2021 on positive note after budget signing

By Revin Mikhael D. Ochave, Reporter

LOCAL shares closed in positive territory on Tuesday, the last trading day for the year, as investor sentiment was lifted by the signing of the 2021 national budget.

The benchmark Philippine Stock Exchange index (PSEi) rose 17.46 points or 0.24% to end at 7,139.71, while the broader all shares index increased 18.34 points or 0.43% to close at 4,272.61 for the final trading day of 2020.

Compared with the previous month, PSEi’s close for December was an improvement of 348.25 points or 5.1% from the market’s finish in November, at 6,791.46. The market is closed until Jan. 4 due to the Rizal Day and New Year holidays.

In a mobile phone message, Philstocks Financial, Inc. Research Associate Claire T. Alviar said the market ended higher on the last trading day of the year as investors reacted positively after the 2021 national budget was signed by President Rodrigo R. Duterte.

“There’s no more fear about the re-enacted budget next year that may have hindered economic recovery,” Ms. Alviar said.

On Monday, Mr. Duterte signed the P4.5-trillion 2021 national budget, which gave the education sector the biggest allocation at P708 billion. The Department of Public Works and Highways followed with a budget of P694 million, and the health sector with P287 billion.

Further, Ms. Alviar noted that the market’s foreign investment portfolio recorded a net inflow, which also contributed to Tuesday’s strong finish. Net foreign buying reached P87.48 million, against the foreign outflows worth P98.26 million during the previous trading session.

“In addition, there’s also a window dressing for the end of the year,” Ms. Alviar said.

Meanwhile, Timson Securities, Inc. Head of Online Trading Darren Blaine T. Pangan said one of the market’s catalysts for December was the developments on the coronavirus disease 2019 (COVID-19) vaccines.

The month was highlighted by news of the first person to be vaccinated against COVID-19, with the United Kingdom (UK) coming out as the first country to approve the vaccine made by Pfizer and BioNTech.

However, Mr. Pangan noted that the market sentiment was affected by recent news on the new COVID-19 strain discovered in Britain.

“As a result, some investors chose to stay cautious ahead of the Christmas holidays, while other market participants conducted some bargain hunting activity during the last trading session of the year,” Mr. Pangan said.

In mid-December, the world was shocked as the UK announced the discovery of a new COVID-19 strain that was identified to be more infectious. Several countries, including the Philippines, have imposed travel restrictions on the European country.

On Tuesday, the majority of the sectoral indices at the PSE improved. Mining and oil rose 291.59 points or 3.15% to 9,528.15; industrials picked up 142.45 points or 1.54% to 9,393.42; financials improved 8.95 points or 0.62% to 1,447.64; and holding firms went up 30.96 points or 0.42% to 7,354.65.

Property declined 21.64 points or 0.58% to 3,664.47, while services retreated 2.18 points or 0.14% to 1,514.09.

Decliners edged out advancers, 122 against 119, while 36 names ended unchanged.

Value turnover on Tuesday amounted to P11.11 billion with 95.98 billion issues switching hands, higher than the P8.14 billion with 60.55 billion issues during the previous trading session.

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