The stock market and the peso rose for the second day Wednesday as the controversial Rodrigo Duterte tried to soothe investor worries after his landslide victory in presidential elections Monday.
The Philippine Stock Exchange Index surged 221.64 points, or 3.1 percent, to 7,396.52 on a value turnover of P12.9 billion. Gainers overwhelmed losers, 160 to 50, with 34 issues unchanged.
The peso, meanwhile, strengthened further against the US dollar Wednesday, gaining P0.20 to close at 46.55 from 46.75 a day before, two days after the national elections that saw Davao City Mayor Rodrigo Duterte as the clear winner in the hotly-contested polls.
It was the local currency’s strongest level since the 46.44 on April 21. Total volume turnover stood at $806 million, slightly lower than $825 million on Tuesday.
Analysts said the results of the polls removed one uncertainty that had affected the peso’s trading in the past months.
“[There are] some appreciation pressure as the dollar was weaker overnight. We will take our cue from global developments now that the elections are over,” Nicholas Antonio Mapa, research officer at the Ayala-led Bank of the Philippine Islands, said in an emailed statement.
SM Prime Holdings Inc., the biggest builder, advanced 5.2 percent to P25.25, while JG Summit Holdings Inc. of industrialist John Gokongwei jumped 6.5 percent to P88.
Robinsons Retail Holdings Inc., a unit of JG Summnit, surged 6.1 percent to P82.20, while Megaworld Corp., the third-largest builder, climbed 5.2 percent to P4.05.
The rest of Asian markets tapered Wednesday after an early rally as nerves returned to trading floors, with a pick-up in the yen skimming Japan’s Nikkei.
The day started on a positive note as gains on Wall Street and in Europe—fuelled by upbeat Chinese inflation data and progress on Greece’s debt relief—provided a healthy buying catalyst after last week’s sell-offs.
The gains initially extended into Asia, with Tokyo’s Nikkei surging with exporters thanks to the weakening yen but the rally petered towards the end of the day as the Japanese unit recovered.
By the close of trade Tokyo was up 0.1 percent. The dollar slipped to 108.67 yen from 109.27 yen late in New York, but analysts said the losses were to be expected after rallying over the past week and the dollar could hit 110 yen soon. The greenback hit a recent trough of 105.50 yen last Tuesday.
Japanese leaders, including Finance Minister Taro Aso, have tried to cap yen gains by keeping the possibility of government intervention on the table.
“Talk of intervention from Japan is one catalyst pushing the yen lower,” Masato Yanagiya, head of currency and money trading at Sumitomo Mitsui Banking Corp. in New York told Bloomberg News.
In other markets Shanghai ended 0.2 percent higher and Sydney rose 0.6 percent but Seoul slid 0.1 percent.
Hong Kong was one percent down as mainland shares listed in the city were hit by fears China may not introduce any fresh stimulus for some time after a warning over debt levels by the government mouthpiece People’s Daily. With AFP