INDEX  GAINS  FOLLOWING  BSP  DECISION  TO  CUT  KEY  RATES

MANILA, JULY 14, 2007
(STAR) Share prices closed 0.78 percent higher yesterday a day after the central bank cut its key interest rates, dealers said.

However, they said quick profit-taking trimmed the gains after the main index climbed to a fresh record high early in the session.

The composite index added 29.27 points to 3,786.02 after hitting a new trading high of 3,820.55. It hit a low of 3,778.47 points.

The all-share index rose 18.25 points to 2,437.39.

Of the 173 shares that were traded, 77 advanced and 48 retreated, while 48 stocks were unchanged. Volume reached 9.62 billion shares worth P6.83 billion.

“We hit a strong resistance level early in the session but, given the optimism in equities markets throughout the region, we expect the market to test the 3,800 level again early next week,” said Lawrence de Leon of Accord Capital Equities.

Asian stocks traded higher early Friday following record highs on Wall Street Thursday as investors were heartened by the strong retail sales figures in the United States.

On Thursday, the BSP surprised the market with its twin policy moves, cutting its overnight borrowing rate by 150 basis points to six percent, and removing the tier system of paying lower rates for commercial banks’ placements with the central bank in excess of P5 billion.

The BSP said the two complementary moves still maintained its neutral policy stance.

Investors welcomed the central bank’s policy action.

“There may be a shift of funds from fixed-income instruments to the equities market, where yields could be better,” said Astro del Castillo of First Grade Holdings.

Shares in Philippine Long Distance Telephone Co. (PLDT), the country’s biggest company by market value, rose P35 to P2,735.

Ayala Corp., the country’s largest conglomerate, was up P5 at P580.

Megaworld Corp., the country’s third biggest property developer by market value, jumped 10 centavos to P4.05.

San Miguel Corp. saw its A and B shares remain unchanged at P76.50 and P82.50, respectively. — AFP


Chief News Editor: Sol Jose Vanzi

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