Local equities returned to the 7,200-point territory as the benchmark stock index mirrored gains from global markets, boosted by the announcement of new China stimulus for banks.
The Philippine financial markets as well as most Asian and European markets were influenced by the People’s Bank of China’s decision to make available 500 billion yuan ($81 billion) in fresh loan funds to its top five banks “to improve stimulus in region.”
The main Philippine Stock Exchange index (PSEi) gained 0.72 percent or 51.50 points to close at 7,231.84, while the wider All Shares index settled 0.68 percent or 29 points higher at 4,283.47.
Astro del Castillo, managing director of First Grade Finance Inc., said the PSEi rode on the optimism fueled by the China stimulus, following the lead of other global markets in Wednesday’s trade.
“We were also caught in the wave of optimism in global markets as a result of reports that China will invest and inject funds to boost its economy,” del Castillo said via a brief phone interview.
“There was relief in the market, and investors were encouraged to buy stocks,” he added.
Del Castillo said that despite the boost, the market is still cautious ahead of the conclusion of the monetary policy meeting of the US Federal Reserve.
Jason Escartin, investment analyst at F. Yap Securities Inc., also said that aside from the China stimulus, the market also responded to the overnight Wall Street rally.
“Sentiment took its cue from US equities’ overnight rally, while others position for the window-dressing season in the fourth quarter,” Escartin explained.
The Dow Jones closed with a 100.83-points gain, while the S&P 500 advanced 14.85 points, and the Nasdaq added 33.86 points in Wall Street’s Wednesday trading session.
All the sectoral indices on the local board finished in positive territory. Financials were up 0.79 percent or 13.30 points at 1,704.81; industrials increased 1.01 percent or 112.53 points to 11,244.72; holding firms jumped 0.75 percent or 47.04 points to 6,340.37; services added 0.31 percent or 6.89 points to 2,226.57; mining and oil went up 0.25 percent or 45.41 points to 17,997.36; and property was ahead 0.99 percent or 26.89 points at 2,752.98.
Among the 10 most active stocks, the only losers were Philippine Long Distance Telephone Company, down 0.06 percent or P2 to close at P3,304, and Alliance Global Group, which dipped 0.41 percent or P0.10 to end at P24.35 per share.
Universal Robina Corp., Ayala Land, Puregold Price Club, Security Bank Corp., SM Prime Holdings, Travellers International Hotel Group, Ayala Corp. and Energy Development Corp. all posted gains in active trade.
Total volume traded was 3.254 billion shares, valued at P8.111 billion. Gainers were well ahead of declining shares, 107 to 71, while 45 issues were unchanged.
On Tuesday, the PSEi advanced 19.07 points or 0.27 percent to 7,180.34, while the All Shares index added 14.83 points or 0.35 percent to 4,254.47.