Stocks rose Wednesday, ending a five-day slide as investors take their position ahead of US President Donald Trump’s inauguration Friday.
The Philippine Stock Exchange index, the 30-company benchmark, rose 33 points, or 0.5 percent, to close at 7,156.36. The bellwether was also up 4.6 percent since the start of the year.
The broader index, representing all shares, also gained 16 points, or 0.4 percent, to settle at 4,321.58, on a value turnover of P5 billion. Advancers edged losers, 86 to 85, while 55 issues were unchanged.
Eleven of the 20 most active stocks ended in the green, led by property developer Arthaland Corp. which advanced 9.3 percent to P0.82 and Bloomberry Resorts Corp. which climbed 2.7 percent to P6.75. JG Summit Holdings Inc. of tycoon John Gokongwei rose 2.6 percent to P74.90.
Meanwhile, equity traders in Asia were on edge owing to uncertainty about the prospects of a Donald Trump presidency.
The greenback plunged Tuesday following comments from the US president-elect in an interview that it was too strong and that a weak Chinese yuan was “killing us,” fueling concerns of a possible currency war.
The sell-off marked a sharp turnaround for the US unit, which has been surging since Trump’s November election on expectations his big-spending, tax-cutting plans will fan inflation and force a Federal Reserve rate hike.
“Traders recognize that and when you throw in levels that were overbought — in a US dollar sense — some sort of retracement was on the cards,” Greg McKenna, chief market strategist at FX and CFD provider AxiTrader, said in a note.
“Add in Trump’s recent rhetoric about the US dollar being too strong—he was talking in context of China in this sense but the message is a broad one—and you get a chance for further US dollar weakness.”
Trump’s comments came days before he takes the oath of office on Friday, with market-watchers hoping his speech will provide some detail on his plans for the US economy as well as his intentions on the global trade front.
On Tuesday Chinese President Xi Jinping warned at the World Economic Forum in Davos against protectionism, alluding to Trump’s plans to tear up global trade deals, saying it was like “locking oneself in a dark room. Wind and rain may be kept outside, but so is light and air”.
In afternoon trade Wednesday, the dollar was up on the yen, euro and pound but was struggling against higher-yielding units including South Korea’s won, the Australian dollar and Malaysian ringgit.
The pound held up as it witnesses a volatile week that saw it plunge to three-decade lows against the greenback on worries about Britain’s plans for a clean break from the European Union.
However, it bounced sharply Tuesday after British Prime Minister Theresa May set out her plan to leave the customs union and single market in a so-called “hard Brexit”, and promised to let Parliament vote on the deal.
On equity markets Sydney was 0.5 percent down and Seoul was marginally lower. Singapore, Wellington, Taipei and Kuala Lumpur were also down.
However, Hong Kong rallied 1.2 percent in the afternoon, boosted by a flood of mainland Chinese investors picking up stocks considered cheap compared with those north of the border.
Tokyo ended 0.4 percent higher as the dollar’s advance against the yen helped Japan’s exporters.
Shanghai finished 0.1 percent higher. Late Tuesday China’s Cabinet issued a notice saying it had granted approval in principle for foreign companies to list shares and issue corporate debt and other financing instruments as part of a drive to open up the country’s markets. With AFP, Bloomberg