November 23, 2022 | 5:27pm
MANILA, Philippines — Local shares rallied on Wednesday amid optimism on future US rate hikes and deflected fears about China’s strict Covid19 rules.
The Philippine Stock Exchange index soared 1.25% to close at 6,510.32 on Wednesday. The broader All Shares index inched up 0.75%, with all of the sub-indices closing in the green. Property shares led the pack, surging 2.57%.
Luis Limlingan, head of sales at local brokerage Regina Capital, noted that the market’s upbeat performance was largely due to investors’ optimism.
“Philippine shares broke through the 6,500-level as investors looked ahead to the publication of the FOMC meeting minutes for clues into the pace of future rate hikes and shrugged fears of further lockdowns in China,” he said in a Viber message.
Limlingan explained that the news of Japanese firms’ investment plans kept the market moving up. As it is, the local bourse shed some malaise plaguing sentiment in past weeks.
A bear market described equity movement once shares fall by as much as 20% from a recent peak.
The PSEi found itself trading in a bear market days before the end of September. Back then, inflation fears compelled investors into abandoning their positions since global equities likewise anticipated a similar trend taking hold.
Hernan Segovia, a trader at Summit Securities, noted that the local bourse has indeed left bear territory.
“Previously, the PSEi and peso movement don’t correlate well. It was only this year that it was both inversely correlated,” he said.
Segovia explained that he was “quietly bullish” on the local bourse since the US dollar’s pullback. The peso regained strength in the past few days, as the Bangko Sentral ng Pilipinas vowed they would defend the peso against speculative attacks.
“The peso that was by many (and yes until now) to reach P60 and beyond strengthened to P57. I know this sounds so hopeful but we might see the peso going back to mid-56 and the PSEi at 6,800 this year,” Segovia added.
Regional equities revelled in optimism for the most part. Shanghai, Sydney, Seoul, Mumbai, Taipei, Bangkok and Jakarta also rose, though Singapore and Wellington dipped. Tokyo was closed for a holiday.
Foreign investors bought P423.97 million more shares than they sold in the stock market. A total of million 802.39 million stocks, valued at P5.88 billion, switched hands on Wednesday. — with AFP
