Local shares rally on easing of Metro Manila lockdown

Ramon Royandoyan - Philstar.com
Local shares rally on easing of Metro Manila lockdown
This undated file photo shows the Philippine Stock Exchange building in Taguig City.
STAR / File

MANILA, Philippines — Investors cheered after the government announced that Metro Manila will shift to looser movement restrictions this week, sending local shares up on Thursday and fueling optimism over further economic reopening.

The Philippine Stock Exchange index gained 1.62% to close at 7,183.11. This was the main index's best finish since closing at 7,198.45 on January 19.

The broader All-Shares index likewise firmed up, rising 0.92%. All six sub-indices closed in the positive territory, with holding firms leading the pack with 2.28% gains.

“The market closed higher today as investor sentiment was buoyed by optimism from news of easing restrictions in Metro Manila,” Rastine Mercado, research director at China Bank Securities, said in a market commentary.

Metro Manila will transition to more-relaxed Alert Level 3 restriction from October 16 to 31, as cases go down while vaccination rate picks up. The health department reported 7,000 new cases on Wednesday, a far cry from the all-time high of 22,000 in the middle of the Delta variant surge in August.

The announcement fueled hopes that the easing of curbs would stimulate business activity in the capital region, which typically accounts for a third of the country’s GDP.

The local bourse moved in tandem with other Asian markets, which also posted gains as investors maintained optimism in the global recovery outlook but prepared for the end of an era of cheap cash with inflation continuing to surge on the back of supply chain problems and improving demand.

After a year and a half of ultra-loose monetary policies from the world's central banks, which helped spur a rebound from the pandemic collapse and send equities flying, concern about consistently high price rises is forcing officials to tighten their belts.

Several have already started — including South Korea and New Zealand, with Singapore joining in on Thursday — but all eyes are on the Federal Reserve, with minutes from its most recent meeting showing it plans to move either next month or December.

Tokyo piled on 1.5%, while Seoul and Jakarta added more than one percent.

There were also gains in Sydney, Wellington, Taipei and Mumbai, while Singapore advanced as investors brushed off the surprise policy tightening by the city's central bank. However, Shanghai dipped.

At home, foreign investors bought P191.09 million more shares than they sold in the stock market. A total of 1.01 billion shares, valued at P10.3 billion, were traded on Thursday. — with AFP

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