The stock market advanced Monday, led by PLDT and Globel Telecom Inc., after San Miguel Corp. agreed to a $1.5-billion deal to sell its telecommunication assets.
The Philippine Stock Exchange Index rose 52.66 points, or 0.7 percent, to 7,464.34 on a value turnover of P15.4 billion. Losers, however, beat gainers, 104 to 85, with 45 issues unchanged.
Philippine Long Distance Telephone Co., the biggest telecommunications company, jumped 9.1 percent to P1,901, while rival Globe climbed 5.6 percent to P2,310.
San Miguel gained 5.8 percent to P80.30.
PLDT and Globe acquired the telecommunications business of San Miguel for about P70 billion, including debt, according to statements from the companies Monday. PLDT and Globe are each taking a 50 percent stake in the business and saw their shares soar after the announcement.
San Miguel is selling its telecommunication business two months after it ended talks with Telstra Corp. for a joint investment in a new mobile network in the Philippines after they failed to agree on terms.
Liberty Telecoms Holdings Inc., part of the assets sold by San Miguel, plunged 19.6 percent to P3.62.
Tokyo stocks, meanwhile, led Asia higher Monday, boosted by hopes the government will delay a sales tax hike and by a weaker yen after Federal Reserve boss Janet Yellen hinted that a US interest rate increase was looming.
Tokyo ended up 1.4 percent and above 17,000 points for the first time in a month as the dollar surged against the yen. Hopes the government would delay a consumption tax hike also powered shares higher.
Hong Kong rose 0.3 percent, while Shanghai and Sydney were flat. Seoul shed 0.1 percent, but Jakarta and Taipei gained 0.5 and 0.9 percent, respectively.
“There has been a deliberate move on the part of the Fed to steer the market toward prospects of near-term tightening,” Philip Borkin, a senior economist at ANZ Bank New Zealand Ltd., said in a client note according to Bloomberg News.
“The Fed will probably be reasonably chuffed at the way the market is absorbing that message.”
Yellen said Friday she believed growth and the strengthening of the labor market would continue, and in that case, “probably in the coming months such a move would be appropriate”.
That timeframe, which other Fed policymakers have also referred to in recent weeks, would put the Fed’s action at its June 14-15 or July 26-27 meeting.
The US central bank has repeatedly stated its intention to continue raising rates this year after December’s first hike in nine years.
“Janet Yellen’s remarks on Friday confirm that at least one increase in the Fed rate is likely this year,” Ric Spooner, chief market analyst at CMC Markets, said in an email commentary.
“Traders will take confidence from the fact that stock markets are firm in the face of this confirmation. As far as the markets are concerned, the timing of the next Fed increase now becomes the central issue.” With Bloomberg and AFP
