Philippine share prices rose in early trade after data on the US economy showed higher-than-expected growth, fueling confidence for sustained recovery in a major global market despite the headwinds and in the absence of strong local leads.
The Philippine Stock Exchange index (PSEi) ended the morning session with more than a 1 percent gain. It was up 1.02 percent or 71.4 points at 7,093.49.
“Local sentiment got another boost from a surge on Wall Street, especially with signs the US economy grew better than expected. The other catalyst is still on the possibility that the Fed rate hike move may be deferred” from an earlier date in September as the market had earlier speculated, F. Yap Securities Inc. investment analyst Jason Escartin said.
US gross domestic product grew at an annual rate of 3.7 percent in the second quarter, the Commerce Department said. The increase had been estimated at only 2.3 percent, after GDP grew 0.6 percent in the first quarter.
On Thursday night, Wall Street advanced on optimism about the US economy, with the Dow Jones Industrial Average up 2.27 percent or 369.26 points at 16,654.77. The S&P 500 climbed 2.43 percent or 47.15 points to 1,987.66, and Nasdaq rose 2.45 percent or 115.17 points to 4,812.71.
In the Philippines, second-quarter GDP expanded 5.6 percent, up from the first quarter’s 5.0 percent but down from the year-earlier 6.4 percent. The pace also hit the low end of analysts’ forecast range of 5.6 percent to 6.8 percent.