Stocks rose amid thin trading Monday, tracking the regional markets as worries over the health of European banks eased and Japanese shares climbed on a weakening yen.
The Philippine Stock Exchange index, the 30-company benchmark, picked up 48 points, or 0.6 percent, to close at 7,677.73. This pushed up total gains to 10.4 percent this year.
The broader all-share index also gained 26 points, or 0.6 percent, to settle at 4,559.48, on a value turnover of P4.9 billion. Gainers edged losers, 93 to 88, while 50 issues were unchanged.
Sixteen of the 20 most active stocks ended in the green, led by Global Ferronickel Holdings Inc. which climbed 8 percent to P1.08 and Nickel Asia Corp. which advanced 4.9 percent to P7.55. DMCI Holdings Inc. rose 4.5 percent to P12.60, while Manila Water Company Inc. gained 4.1 percent to P30.50.
Meanwhile, Asian markets rallied Monday with financials up on easing fears about the future of German giant Deutsche Bank after a source said it was nearing a deal to slash a multi-billion-dollar US fine.
Traders fled for cover last week, sending stocks reeling Friday, after US officials slapped the lender with a $14 billion charge over its role in the subprime mortgage crisis.
The gigantic figure fueled fears the bank could go under and spark another global financial downturn, while Bloomberg News said several hedge funds had withdrawn their investments in the firm — though the company said it was in a “stable financial position”.
However, on Friday, a person familiar with the matter told AFP that the German bank is near an agreement to pay a much more manageable $5.4 billion to resolve the case.
“A lot of the market sentiment has improved because obviously people were worried that Deutsche Bank might be going to recreate the Lehman moment,” Andrew Sullivan, managing director for sales trading at Haitong International Securities Group in Hong Kong, said referring to the US bank whose fall precipitated the financial crisis.
“The fact that actually Deutsche Bank came out and said it’s well capitalized and that it’s close to securing a deal with US Department of Justice over that fine has just given the market more confidence that we’re not going to have another breakdown in the global banking system,” he told Bloomberg News. With AFP, Bloomberg