Sy-led SMIC stock rises as PSEi nears 6,800 level

INVESTORS snapped up Syled SM Investments Corp. (SMIC) shares last week as the main index finished below the 6,800 level.

According to data from the Philippine Stock Exchange, a total of P1.98 billion worth of 2.19 million shares were traded from July 15 to 19, placing the Sy-led conglomerate in third place in terms of value turnover.

SMIC shares closed at P911 apiece last Friday, 3.5% higher than the P880 closing price on July 12. The stock has gained 4.5% since the start of the year.

“Investors can draw several reasons from the recent price movement of SM,” Regina Capital Development Corp. Equity Analyst Alexandra G. Yatco said in a Viber message, referring to the company’s ticker symbol. “As a whole, the index has been experiencing strong upward movement, with the PSEi (Philippine Stock Exchange index) closing just below 6,800 after falling below 6,200 several weeks ago.”

“Naturally, as SM is a main index heavyweight, it would lead this price movement,” she added.

The local bourse’s main index rose by 1.29% or 86.68 points to 6,791.69 last Friday. It was the

PSEi’s best finish since April 4, when it closed at 6,827.06.

Meanwhile, Mercantile Securities Corp. Head Trader Jeff Radley C. See said in a Viber message that SM’s rally in recent days is attributed to the recent inflation report in the United States.

According to a Reuters report, US consumer prices decreased for the first time in four years last June, amid moderating rents and cheap gasoline prices.

“This is bullish news because the [Federal Reserve Bank] might signal a rate cut this year,” he said, adding that the US dollar has started to weaken against the peso, which may encourage foreign investors to return.

SMIC’s attributable net income grew by 6.3% to P18.39 billion in the first quarter, up from P17.3 billion in the same period last year.

Mr. See expects profit taking next week, as SMIC is currently trading at overbought levels.

He placed SMIC’s resistance level at P930, while its support levels are P900 and P860. Established support and resistance levels for the stock are P869 and P923, respectively. —