Analyst view: Aquino has big lead in Philippine election

MANILA (Reuters) - Benigno "Noynoy" Aquino is a clear leader in vote counting in the Philippine presidential election, and a result seen as credible and consistent with opinion polls is expected to boost local markets on Tuesday. Aquino has over 40 percent of votes cast for the presidency, and leads second-placed Joseph Estrada by about 15 percent points with nearly 80 percent of votes counted, the election commission said on Tuesday.

Following are analysts reactions to Aquino's victory:

SONG SENG WUN, REGIONAL ECONOMIST, CIMB RESEARCH,

SINGAPORE:

"A strong mandate will bring policy continuity which is what people want to see. The last thing they want to see is always uncertainty as we've seen in Britain. The popular support hopefully will translate into confidence in the economy.

"What the Greek story has shown, the weakness in tax collection can cause a lot of problems. So they should continue improving revenue collection and government finances. After that, they can focus on infrastructure."

VISHNU VARATHAN, REGIONAL ECONOMIST, FORECAST, SINGAPORE:

"In terms of market reaction, it looks like there will be less political instability/violence risks in relation to the results being contested, so with that uncertainty watered down, it looks like a relief rally might be in order.

"What remains to be seen is the policy transition between administrations once the power transition is proven to be smooth.

"The ability of the new administration to push forth with reforms -- not all of which will go down well with the populist agenda -- and to get the fiscal house back in order will be one of the key challenges as the economy works its way out of the downturn.

"With the benefit of inflows from exported labor, getting merchandise exports up and moving the manufacturing industry up the value chain will be another challenge.

"And on the political front, the ability to get a grip on graft and to optimize resource usage will be the key watch factors for investors."

JONATHAN RAVELAS, CHIEF MARKET STRATEGIST, BDO UNIBANK,

MANILA:

"The present trending of the results appear to be consistent with the last SWS and Pulse surveys. It will be well received by the markets. We were able to exercise our right to suffrage. The election commission was able to find ways to push through with the elections.

"The leading presidential candidate appears to be well received by investors. The things they will watch out for are: who will comprise the cabinet and his inner circle; how will he address the growing budget deficit and lastly, what will be the order of battle: will it be infrastructure spending or social services or how they will fund the deficit. These are the things the financial markets will want to know."

EUBEN PARACUELLES, ECONOMIST, NOMURA, SINGAPORE:

"In terms of the results, early indications is that Aquino is going to be the likely winner which is what we have been expecting all along and can be viewed quite positively."

"Whether he can push forward longer-term reforms, that will still be a question. One surprise is that in the vice presidential contest, Estrada's running mate is leading which might prove to be a dent for the reform process.

"It is positive for the market in the short term, but on a longer term nature it still remains to be seen."

STANDARD CHARTERED BANK:

"Preliminary results show that Aquino has a 4.3 million lead over his closest rival Joseph Estrada, based on the partial and unofficial tally of 76.4 percent. We see this as a positive for markets as a wide margin implies less risk of a challengeable result. As such, the election is likely to be broadly positive overall -- although Aquino does not have quite so clear a reform platform as was the case in the Indonesian elections of 2009. In sum, we expect the PHP to play catch up as the year progresses with the appreciation seen elsewhere in the Asia ex-Japan region. For end-Q2, Q3 and Q4 this year, we are forecasting USD-PHP at 44.00, 43.00 and 41.50."

(Reporting by Saikat Chatterjee, Umesh Desai, Jun Ebias and Manolo Serapio Jr; Editing by John Mair)