Philippine stocks rallied on Thursday, rebounding back to the psychologically important 6,800-point level, as investors cheered the minutes of the latest Federal Reserve Board meeting which indicated that the US central bank was not considering raising interest rates any time soon.
The Philippine Stock Exchange index (PSEi) rose past the 6,800 mark Thursday and settled at 6,830.58, gaining 68.20 points or 1.01 percent, while the wider all shares added 32.78 points or 0.81 percent to 4,073.72. Overseas, Asian markets rallied by more than 1.0 percent.
“Providing enough lift to reverse the widespread pessimism of the previous day [Wednesday] were the Fed minutes,” said analyst at Justino Calaycay, Accord Capital Equities Corp.
Overnight, the minutes of the April 29 to 30 Federal Reserve meeting showed that the Fed is confident it can keep target interest rates at current near zero levels for what it calls a “considerable time” after the complete unwinding of the stimulus program.
“In that meeting, another $10 billion was pared off the monthly bond-purchase fund, pulling the total cuts to $40 billion and the fund to only $45 billion. Inflationary pressures from these cuts in QE3 [third quantitative easing]are seen to be subdued,” Calaycay said.
All sectoral indices were higher amid the widespread optimism, with holding firms rising 78.33 points or 1.28 percent to 6,191.72, followed by industrials, which advanced 78.33 points or 1.28 percent to 6,191.72.
Services went up by 14.16 points or 0.70 percent to 2,046.96, while property rose 18.47 points or 0.68 percent to 1,716.89. Financials added 9.72 points or 0.61 percent to 1,600.43 while mining and oil climbed 80.97 points 0.52 percent to 15,816.64.
However, trading volume was thinner at 876 million shares, valued at P8.9 billion. Advancers edged out decliners 106 to 68, while 41 issues were unchanged.
Some of the most actively traded stocks were BDO Unibank Inc., down 0.11 percent at P87.00; Philippine Long Distance Telephone Co., up 0.55 percent at P2,900; Ayala Corp., up 1.32 percent at P654.00; and Puregold Price Club Inc., up 0.84 percent at P41.95.
On Wednesday, the main index fell below the 6,800 level for the first time in several days, wiping out the gains of the past 10 trading days, as the sluggish trend in the global market weighed on sentiment. The PSEi shed 120.35 points or 1.75 percent to end at 6,762.38, while the wider all shares lost 69.68 points or 1.70 percent to 4,040.94.