The stock market jumped Wednesday along with the rest of Asian markets on increasing optimism that China and the United States will be able to hammer out a deal to help ease their trade war.
The Philippine Stock Exchange Index surged 217.55 points, or 2.8 percent, to 7,919.67 on a value turnover of P10.2 billion. Gainers beat losers, 140 to 72, with 30 issues unchanged.
Aboitiz Equity Ventures Inc., which is into power generation, banking, food and infrastructure, advanced 6.6 percent to P61, while SM Investments Corp. of retail tycoon Henry Sy Sr. climbed 6.1 percent to P995.
JG Summit Holdings Inc. of industrialist John Gokongwei rose 5.9 percent to P63.50, while International Container Terminal Services Inc., the biggest port operator, gained 5.2 percent to P104.
The rest of Asian markets rallied Wednesday. After taking a battering in December and suffering a shaky start to 2019, confidence is slowly returning to equity trading floors, though dealers remain on edge.
Hong Kong rose 2.3 percent—a fourth straight gain that has seen the index put on around five percent—and Shanghai ended up 0.7 percent, while Tokyo closed 1.1 percent higher.
Sydney jumped one percent with Singapore, while Taipei and Wellington were each more than one percent higher. There were also gains in Mumbai and Jakarta.
Seoul added two percent as North Korean leader Kim Jong Un visited Beijing with speculation swirling that he will meet Trump for a second summit later this year.
Federal Reserve boss Jerome Powell provided the platform for a rally last week when he said the central bank had no “pre-set” plan for lifting interest rates and was “listening” to markets, signaling that the pace of hikes could slow this year.
Fear of higher borrowing rates was a major cause of last year’s stocks losses.
The mood among dealers held this week as officials from China and the US hunkered down for trade negotiations in Beijing that have extended into a third day. US President Donald Trump on Tuesday described them as going “very well.”
Bloomberg also reported White House sources as saying Trump is keen to get a deal done in order to boost stock markets, which he regards as a gauge of his success.
And the Wall Street Journal said the two were moving in the right direction, with China ready to buy more US goods and services, while further talks at cabinet level were being lined up next week.
The progress in talks “is fueling investor optimism suggesting there might be a light at the end of the trade war tumultuous tunnel”, said Stephen Innes, head of Asia-Pacific trade at OANDA.
The gains also come after a strong reading on US jobs creation Friday, which soothed worries that the American economy was slowing down, and ahead of the corporate earnings season.
“When the dust settles, if it ever does, the fear of recession will prove to be premature,” Bob Doll, an analyst at Nuveen Asset Management, told Bloomberg TV. With AFP