2ND LD: Philippine shares, peso soar on end of Estrada rumors

Asian Economic News, Nov 13, 2000

MANILA, Nov. 6 Kyodo

(EDS: UPDATES WITH PESO CLOSING)

Philippine shares surged Monday with the key stock index closing 16.48% higher, and the peso strengthened against the U.S. dollar on rumors President Joseph Estrada is set to resign.

The 30-issue Philippine Stock Exchange Composite Index rose 212.25 points to 1,500.10 at the end of trading from 1,287.85 last Tuesday. There was no trading Wednesday to Friday due to a long holiday.

Gainers outpaced losers 99 to eight, with six issues closing unchanged. The volume of shares traded rose to 1.7 billion valued at 3.6 billion pesos ($70.8 million), from 356 million shares valued at 536 million pesos traded Oct. 31.

The market made the gains as the House of Representatives justice committee began formal impeachment proceedings Monday against Estrada over various charges, including an allegation he pocketed more than $8 million in kickbacks from illegal gambling operators.

Traders said foreign investors were among buyers who bid up share prices on the resignation rumors, which benefited blue-chip issues in particular.

Analyst Bong Bongolan of PCCI Securities said that while he hopes the bullish sentiment will be sustained, ''I would just not count on it yet.''

He said there are still ''a lot of ifs and buts'' about the political situation, and that while the opposition may be on the offensive now, Estrada could launch a counter-offensive.

The peso, which fell to an all-time low 51.950 against the dollar before closing at 51.000 Tuesday, strengthened Monday to a high of 47.950 before closing at 48.050. It's weighted average for the day was 48.895, up from 51.680 Tuesday.

Widespread calls for Estrada to resign continue to mount, fueled by opponents' charges he is incompetent and has lost the ''moral ascendancy to govern.''

At a historic Manila shrine, the site of the February 1986 ''people power'' revolt that ousted Ferdinand Marcos and swept Corazon Aquino to power, tens of thousands of protesters gathered Saturday to call for Estrada to go.

Newspapers reported Monday that political talk is taking place to secure a ''graceful exit'' for the embattled former actor.

But Estrada reiterated Sunday that he would not resign, pledging to prove his innocence during an impeachment trial in the Senate.

The bribery scandal has devastated the Philippine economy, shaving 10% off the peso's value in the last month and driving away foreign investors.