PHL poised to gain from investor focus on emerging markets

The local equities market stands to be a “net beneficiary” of global investors’ heightened interest in emerging markets like the Philippines, according to the Philippine Stock Exchange (PSE).

PSE president Hans B. Sicat said the absence of a major corporate blowout, the soundness of the banking sector, the benign inflation, and the relative stability of Asia, especially Southeast Asia, all bode well for more foreign capital inflows in the coming months while the attractiveness of United States and Europe wanes in the investors’ eyes.

Sicat added, “There should be a few more follow-ons… compliance with the 10 percent minimum public float, and a few more private placement transactions to add more volume” in the rest of the year.

In the PSE president’s assessment, the glimmer of Philippine equities and expectations of higher trade volumes are largely due to predictable economic fundamentals.

“We had an upgrade in a period when upgrades are hard to get,” Sicat said in reference to the ratings upgrades the country earned from global debt watcher, Fitch Ratings.

The PSE is thankful the Philippine economy has been “less exciting” than that of debt-ridden United States and some European nations.

“We haven’t had a major trading partner going bankrupt on us,” Sicat added, while noting that the local market has been “less volatile, with not as wide levels of swings.”

Sicat noted that all the capital-raising activities done so far this year already matches what was achieved in 2010, making the next months’ outcomes incremental gains.

Among the significant listings and capital-raising executed as of last June 30 were by:

Megawide Construction Corp. – (IPO),

San Miguel Pure Foods Company Inc Preferred Shares – (follow-on),

Sta. Lucia Land, Inc. – (share for property swap),

Banco de Oro Unibank, Inc. – (placement),

Metropolitan Bank and Trust Company – (stock rights),

Robinsons Land Corp. – (stock rights),

San Miguel Corp. – (follow-on),

Trans-Asia Oil and Energy Development Corp. – (stock rights), and

Metro Pacific Investments Corp. – (underlying common shares for convertible securities).

— RSJ/JE, GMA News