Top Philippine fund manager sells stocks as valuations rise

[MANILA] The biggest Philippine money manager is reducing equity holdings on concern a rally that drove valuations to the most expensive level in Asia is poised to end.

The Philippine Stock Exchange Index, which is within 0.3 per cent of entering a bull market, may face a correction in coming months, Fitzgerald Aclan, a vice-president in the money management unit of BDO Unibank Inc, which oversees about US$18 billion, said in an interview in Manila on May 16. The bank plans to introduce new funds this year that give clients access to overseas markets, including the United States and China.

Philippine shares have posted the second-biggest gain among equity gauges in Asia since December as the economy's strongest two-year expansion since the 1950s in 2013 and a ratings upgrade by Standard & Poor's lured overseas funds. The rally pushed valuations to 18.1 times estimated earnings last week, the highest level since August and the most expensive in the region, according to data compiled by Bloomberg.