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Business

Stocks rise on earnings optimism

Iris Gonzales - The Philippine Star
Stocks rise on earnings optimism
Traders said investors opted to hunt for bargains, with some stocks falling to new lows.
Philstar.com / File Photo

MANILA, Philippines — Local stocks rebounded anew yesterday, highlighting the volatile nature of equities, despite continued tensions as a result of Russia’s war against Ukraine.

Traders said investors opted to hunt for bargains, with some stocks falling to new lows.

The benchmark Philippine Stock Exchange index (PSEi) rallied to close at 7,388.09, up 84.07 points or 1.15 percent, while the broader All Shares index gained 37.68 points or 0.97 percent to end at 3,918.42.

It was a green field for the sectors led by mining and oil, which continued to rally as oil prices continue to move up.

Total value turnover reached P8.255 billion. Market breadth was positive, 121 to 76, while 41 issues were unchanged.

“Earnings optimism kept the index afloat, and foreign funds flowed in on news that MSCI will remove Russia from its basket of Emerging Markets which will increase the weighting of other EMs like the Philippines,” AB Capital Securities said in a note.

In Asia, stocks also advanced after the US central bank chief said the Russia-Ukraine crisis would not likely derail the policy plans, helping revive some appetite for riskier assets.

Federal Reserve chair Jerome Powell also backed a 25-basis point hike in March, effectively ruling out the prospect of the feared 50 basis points hike.

Powell, in a testimony late on Wednesday, said the bank was proceeding largely as planned on its interest rate hike cycle, unencumbered by risks from Russia’s invasion of Ukraine.

The testimony followed a heavy sell-off in risky assets over the last few days, following the military crisis. As such, markets took Powell’s comments as a vote of confidence in the economy, even as the prospect of higher rates supported the dollar.

“That may be the assurances which market participants are seeking, who have been trying to adjust their expectations between geopolitical risks and Fed’s policy outlook,” said Yeap Jun Ron, a market strategist at IG.

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