Optimism up for Q3 — ING periodic poll

10/16/2009

Investors have increased their optimism on the Philippines beginning the third quarter, a periodic survey of global financial services group ING showed.

ING released yesterday data from its quarterly Investor Dashboard Survey, which shows a 16 percent jump in investor sentiment in the third quarter, moving the Philippine index to the “optimistic” zone.

While recent weather conditions and possible political fatigue have turned local investors cautiously optimistic, investors remain bullish on local stocks and property, due to stronger-than-expected remittances and upswing in asset prices globally, according to ING.

Other highlights of the survey were:

• Asia anticipates a global recovery as the pan-Asia Index increases eight percent to 143 for Q3 2009 from 132 for the second quarter, the highest investor sentiment score since the index was introduced in the third quarter of 2007;

• 53 percent of Filipino investors expect the US to come out of recession within a year while 60 percent anticipate the local economy to turnaround by end 2011; and

• Filipino investors remain bullish about local stocks and property and expect the stock market to further rise by 7.7 percent in Q4 2009.

Cesar Zulueta, managing director, ING Bank, Manila Branch, said local market conditions are now more favorable.

“Economic variables such as inflation, interest rates, company earnings, and remittances, are supportive of higher growth. Investors with the appropriate risk appetite may want to increase their exposure to growth assets like equities,” he added.

Resurgence in economic activity extended to the local stock market, which withstood various weather conditions that hampered trading and rallied 14 percent in the third quarter, according to the survey.

“Share prices continue to rise and soared past the crucial 2,900 trading barrier early in October, supporting survey results that reveal Filipino investors expect the stock market to grow further by 7.7 percent in the fourth quarter,” it said.

More Filipino investors are also bullish about property prices, with the number of investors who expect real estate rates to increase jumping 10 percentage points, from 40 percent in the second quarter to 50 percent in the third quarter.

Filipino investors expect the local property market to increase at an average of 3.2 percent going into Q4 2009, it added.

Filipino investors are looking ahead in their investment approach and are opting for equities in longer-term growth sectors poised to grow from global recovery including energy (55 percent), telecommunications (48 percent) and financial services (42 percent), the survey added.

This investment strategy supports survey results which show local investors’ preference of a balanced investment strategy with medium- to long-term growth and a stable return, it added.

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