By Revin Mikhael D. Ochave, Reporter
PHILIPPINE STOCKS closed higher on Tuesday as investor sentiment got a lift from the Bicameral Conference Committee’s approval of the proposed Corporate Recovery and Tax Incentives for Enterprises Act (CREATE).
The bellwether Philippine Stock Exchange index (PSEi) improved by 53.12 points or 0.77% to close at 6,867.88, while the broader all shares index rose 40.5 points or 0.98% to 4,144.17.
AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail that the market improved as investor sentiment was boosted by the approval of the CREATE bill by the Bicameral Conference Committee on Monday.
“The bill is expected to boost the economy’s recovery with the outright reduction of corporate income tax and other fiscal incentives,” Mr. Mangun said.
Under the proposed law, the country’s corporate income tax will be lowered to 25% compared to the current rate of 30%.
“Included in the law is the value-added tax free sale and importation of coronavirus disease 2019 (COVID-19) drugs, vaccines, medical devices, and components of personal protective equipment until December 2023, which will make the process cheaper for the private sector,” Mr. Mangun said.
Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a mobile phone message that the market closed higher as Socioeconomic Planning Secretary Karl Kendrick T. Chua announced the possibility of further relaxing the country’s quarantine measures by March.
“The easing of restrictions would allow more consumer and business activities, which in turn would help our local economy recover,” Mr. Tantiangco said.
Mr. Chua said in a briefing on Monday that the rollout of COVID-19 vaccines will improve consumer and business confidence, adding the government is not expected to hit its growth targets until lockdowns are eased further.
Majority of sectoral indices at the PSE ended higher on Tuesday, with property being the sole decliner as it went down by 12.68 points or 0.35% to 3,514.47.
Mining and oil increased 278.57 points or 3.3% to 8,715.96; industrials went up 228.59 points or 2.59% to 9,040.26; holding firms climbed 84.43 points or 1.23% to 6,950.16; financials gained 8.39 points or 0.59% to 1,430.18; and services surged 8.19 points or 0.54% to 1,503.73.
Value turnover on Tuesday amounted to P10.66 billion with 56.17 billion issues switching hands, higher than the P9.98 billion with 32.11 billion shares traded in the previous session.
Advancers beat decliners, 157 against 68, while 43 names ended unchanged. Net foreign selling went down to P567.48 million from the net outflows worth P1.19 billion seen on Monday.
“Investors are slowly gaining confidence as more developments progress. The main index remains in a downtrend and until we see it break above 7,000, the current trend will remain,” AAA Southeast Equities’ Mr. Mangun said.