Philippine-based investors are the main drivers of the local listed equities market, which the local bourse president Hans B. Sicat said, is on track to breaking last year’s record of P107.5 billion of capital raised.
Speaking before the 4th annual Corporate Treasury and CFO Summit in Makati Thursday, Sicat said 62 percent of average daily turnover in the Philippine Stock Exchange (PSE) comes from a “strong local bid” largely responsible for pushing the total transactions volume to P7.35 billion daily from P5.56 billion year-to-date.
“I think it’s important to know, however, that on the relative share in trading, Philippine-based is still greater compared to foreign trading in related volumes,” Sicat said.
Foreign participation in trades is at 32 percent although these trades increased by more than four times to P89.84 billion as of (Wednesday) from P19.16 billion last year, the PSE president added.
Sicat said this investor profile is similar to what obtains in the BRICs emerging countries made up of Brazil, Russia, India and China, where the market performance is propped up mainly by “strong local demand with the add-on effect of foreign demand.”
“There are lots of reasons to remain bullish and optimistic on the PSE as an attractive investment destination. Compared to our peers, the PSE is just scratching the surface of potential," he said.
The PSE president said the local bourse is a growing market for generating capital, which jumped to P91.13 billion from P60.03 billion last year.
“(Capital raised from the bourse) is well on its pace to break the record level (at P107.5 billion) we achieved last year,” said Sicat.
The benchmark of the PSEi has increased 17.8 percent as of August 22, the PSE president added. The local bourse has breached 21 record highs so far this year.
The PSE is now aiming for “liquidity in stocks,” as it is now requiring listed companies to maintain a 10 percent public float in order to enter the market, said Sicat. As of June this year, 27 companies haveyet to comply with the public float requirement. — ELR, GMA News