The benchmark Philippine Stock Exchange index (PSEi), the stock market barometer, rallied by 248.27 points, or 3.48 percent, to close at 7,383.
KJ Rosales
Peso, stocks bounce back
Iris Gonzales (The Philippine Star) - September 22, 2018 - 12:00am

MANILA, Philippines — The stock market made a giant leap yesterday, boosted by bargain hunting and a spate of good news after several days of turmoil which pushed the market deep into bear territory.

The benchmark Philippine Stock Exchange index (PSEi), the stock market barometer, rallied by 248.27 points, or 3.48 percent, to close at 7,383.

Traders said bargain hunting and infectious optimism from Wall Street saved the market on the last trading day of the week.

At the Bankers Association of the Philippines, the peso likewise recovered, gaining 3.5 centavos yesterday, but remained within the 54 to $1 band.

 The local currency closed at 54.04 yesterday from Thursday’s 54.075. It opened stronger at 54.03, weakened to hit an intraday low of 54.08, but rebounded to hit an intraday high of 53.95 to a dollar.

Trading volume picked up by 10.5 percent to $669.9 million from $606.1 million last Thursday.

BSP officer-in-charge Chuchi Fonacier said the sustained inflows of foreign exchange from overseas Filipino remittances, foreign direct investments, business process outsourcing receipts continue to provide strong support to the peso and sustain the country’s strong external position.

Yesterday’s market performance marked the biggest one day jump since January 25, 2016 when the market rose by 3.64 percent.

Value turnover also exceeded the P10 billion mark versus the daily average of P7 billion the past days. However, despite the bounce, the index was still down for the third straight week by 0.4 percent.

Similarly, the broader All Shares index jumped by 95.44 points or 2.16 percent to end at 4,507.40.

All other indices were also in the green with the biggest gainers led by the financials, property, holding firms and industrial sectors.

Total value turnover reached a whopping P11.582 billion, in stark contrast to the dismal trade the last few days.

Market breadth sprinted back to positive, 114 to 86 while forty-three issues were left unchanged.

Yesterday’s market performance was in stark contrast to the rest of the week’s dismal trade which actually saw the local bourse dive deep into bear territory.

Investors concerns on inflation, the trade war between US and China and the lack of market positive market catalysts have all contributed to the market’s tailspin for most of the week.

But yesterday, Astro del Castillo, managing director at First Grade Finance Inc., said a host of positive developments encouraged market players to make a comeback.

“Bargain hunters ruled the market today. Noise in the domestic arena and concerns on the trade war were set aside plus the run-up in New York last night contributed to the surge in our local market,” he said.

Moving forward, del Castillo said, the market is expected to consolidate ahead of the meeting of the monetary authorities next week.

Luis Limlingan of Regina Capital said the local market made the leap back as US indices closed at record highs and emerging markets funding levels normalized.

US stocks closed higher Thursday with both the Dow Jones Industrial Average and the S&P 500 setting records high levels..

Meanwhile, Fonacier said the central bank has approved the enhanced guidelines on a hedging facility known as the currency rate risk protection program (CRPP) launched during the height of the Asian Financial crisis in 1997 to ease the demand pressures in the foreign exchange spot market.

“The BSP recognizes the need to temper excessive volatility in the foreign exchange market and remains vigilant on the impact of sustained peso depreciation on inflation expectations,” Fonacier said.

Fonacier also said the regulator would take all actions necessary to deal with speculative activity by market participants that may result in excessive peso volatility.

“We are also reviewing other prudential and regulatory measures to help further curb speculative pressures on the spot market,” she said. – With Lawrence Agcaoili

PHILIPPINE STOCK EXCHANGE INDEX STOCK MARKET
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