Mining Industry - The Catalyst of the Philippine Stock Market Growth

The recent plan of the Philippine government to create a new Executive Order or reenact the old laws on mining keeps investors on the sidelines as the president is still undecisive to sign it at present. There maybe some concerns that matters most when the said laws will favor or not with the investors. It was found out that billions of pesos was invested by the Philippine Social Security System and the Roman Catholic Church to the mining industry. What happens if these this new order is against he mining sector? The government investments will also be affected.

Here's some caption of the news recently published by the Philippine Daily Inquirer about the Philippine Stock Exchange's backing up the mining sector.

PSE backs ‘responsible mining’ framework

http://www.business.inquirer.net/48913/pse-backs-'responsible-mining'-framework

"The stock market’s advance, as an indicator of economic growth, has been supported by the mining sector. The growth of the mining and oil index by 69 percent in 2011 helped push the Philippine stock market to become the best-performing in Asia despite the uncertainties in the global environment. 

The PSE reported that in the last five years, the mining and oil sub-index registered an annual growth rate of 39 percent, much higher than the 15-percent annual expansion registered by the next best performing sector, the holding firms sector. On the other hand, the overall market grew an average 8 percent over the same period. 

This growth of the mining sector was even more pronounced in the past three years as the sector posted a compounded annual growth rate of 94 percent since 2008 when markets globally suffered significant declines, the PSE said. 

The PSE report added that the mining sector had created wealth amounting to P378 billion in the last three years, representing the 951-percent increase in the sector’s market capitalization since 2008. Meanwhile, the contribution of trades in mining stocks to total market turnover has jumped from 5.5 percent in 2008 to 14 percent in 2011.

Meanwhile, the PSE also noted that its mineral reporting requirements for listed mining firms would allow stakeholders to have access to information on the practices of listed mining firms with respect to “sustainable” and “responsible” mining.

The most valuable mining firms listed on the PSE and their respective market capitalization levels were: Philex Mining (P106 billion); Semirara Mining (P81.58 billion); Lepanto Consolidated Mining (P67.6 billion); Atlas Consolidated Mining and Development Corp. (P32 billion); Nickel Asia (P30.3 billion); Philodrill Corp. (P10.4 billion); Manila Mining (P16.3 billion); NiHao Mineral Resources (P9.5 billion); and Oriental Peninsula Resources Group (P8.9 billion). Philex and Semirara are part of the main-share PSE index, which recently breached the historic 5,000 mark."