LOCAL stocks extended their gains for a third day this week, breaching the 7,100 points psychological resistance following a global rally overnight on hopes of a broader European Central Bank stimulus program.
The Philippine Stock Exchange index (PSEi) gained 86.19 points or 1.22 percent to 7,154.22, while the wider All Shares added or 41.06 points or 0.98 percent to 4,218.29.
Overnight, foreign news reports said that the ECB was considering buying corporate bonds on the secondary market to bolster the economy and fight deflation in the eurozone.
The report sent global markets rising. In the United States, the S&P 500 had its best one-time gain since last year, up by 1.96 percent. The Dow Jones also rose 1.31 percent while Nasdaq surged 2.4 percent.
DA Market Securities Inc. equity analyst Gab Aguila said: “The western market changes positively from the negatives in the past few days. Today is the second day of the ECB [covered]bond buying program already, which brings positivity in the market.”
Aguila said that investors were eager to put some value in the market following the declines in the past few weeks.
He said the market is looking to breach 7,200 points in the short term due to waning volatility, easing foreign concerns, and the surge of optimism in the local market from the upcoming third-quarter corporate earnings results.
“By next week, we’re already seeing the third-quarter corporate earnings [beginning]to push up the market. This will be the main catalyst that will stimulate the market in the next few weeks,” Aguila said.
The market is seen to trade within the 7,050 to 7,200 range in the short term.
All sectors were up led by properties, which gained 67.31 points or 2.48 percent to 2,785.40. Financials were up 35.94 points or 2.17 percent at 1,693.74, industrials rose 62.92 points or 0.56 percent to 11,398.44, and holding firms added 13.63 points or 0.22 percent to 6,169.
Services leapt 23.13 points or 1.07 percent to 2,177.69 and mining and oil jumped 150.28 points or 0.96 percent
Among the actively traded stocks, PLDT was flat at P3,208 per share while SM Investments Corp declined 2.42 percent or P19 to close at P765.
The rest of the top-traded stocks were gainers including Bloomberry Resorts Corp., Energy Development Corp., Alliance Global Group Inc., Ayala Land Inc., Metropolitan Bank and Trust Co., Security Bank Corp. and SM Prime Holdings Inc.
Advancers outpaced decliners 111 to 67, while 41 shares were unchanged. Trading volume reached 3.3 billion shares valued at P6.69 billion.
On Tuesday, the benchmark index was slightly higher, gaining 10.50 points or 0.15 percent to 7,068.03, while the All Shares inched up 3.48 points or 0.08 percent to 4,177.23.