Stock market rockets 38% in 2010

MANILA–The Philippine Stock Exchange (PSE) posted a whopping 37.6 percent surge in 2010, according to the PSE index.

Data showed that the PSEi advanced by 1,148.46 points to end at 4,201.14 as of Dec. 30, 2010.

Likewise, total value turnover for 2010 reached P1.21 trillion, 29.8 percent higher than the P930.4 billion posted in 2009.

“From a sluggish 2009, Gross Domestic Product grew by 7.5 percent during the first three quarters of 2010, on account of the robust performances of the industry and services sectors. Inflation and interest rates continue to be benign. These factors have largely buoyed stock market sentiment and reinforced investor and business confidence,” PSE chairman Hans B. Sicat said.

“Many of the developed, Western economies were showing signs of economic recovery despite the threat of some European nations’ bankruptcies. Overall, the major global stock markets were on an uptick this year, improving capital market conditions,” Sicat added.

The combined market capitalization of listed issues in the PSE at year-end rose by 47.1 percent to P8.87 trillion compared with P6.03 trillion in 2009.

Preliminary figures also show that foreign investors went into net buying territory in 2010 in the amount of P35.6 billion, higher than the net buying figure of P14.9 billion in 2009.

Total capital raised was P84.9 billion in 2010 due largely to the initial public offerings of Cebu Air, Inc., Nickel Asia and IP Converge Data Center, Inc. and stock rights offerings of First Gen Corp., SM Development Corp. and Bank of the Philippine Islands. This was an improvement over the P38.8 billion raised in 2009.

In terms of sectoral indices, the Holding Firms index emerged as the best performer in 2010 as it climbed by 110.28 percent in 2009. This was followed by the Industrial index at 56 percent.

It can be recalled that last July 26, 2010, the PSE rolled out a new trading system that is designed to trade a wide range of cash, debt and derivative instruments as well as improve the capacity of the PSE to handle any future sharp increases in its value turnover.

The new trading system was developed by the New York Stock Exchange (NYSE) Technologies.

The PSE also completed the transfer of its principal office to Makati City – the financial district of the country through an office integration project that aimed to increase the efficiency of resources and reduce costs in order to enhance shareholder value.

The PSE Board has also approved the spin-off of the Exchange’s market regulation division into an independent and self-regulatory company to monitor activities of trading participants.

In the aspect of Corporate Governance this year, the PSE launched its Corporate Governance Guidelines for listed firms, which will help govern the relationships among the Board, management and shareholders of company.

The PSE also worked on the establishment of a listing segment called the Maharlika Board that will distinguish companies subscribing to higher standards of corporate governance.

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