Stocks rose Tuesday, following overnight gains on the US and European markets sparked by optimism over China’s sweeping plan to boost global infrastructure and a rally in oil prices.
The Philippine Stock Exchange index, the 30-company benchmark, picked up 18 points, or 0.2 percent, to close at 7,791.07, lifted by property issues. The bellwether was up 13.9 percent this year.
The heavier index, representing all shares, gained 9 points, or 0.2 percent, to settle at 4,642.15, on a value turnover of P8.3 billion. Losers outnumbered gainers, 106 to 92, while 49 issues were unchanged.
Eight of the 20 most active stocks ended in the green, led by developer Ayala Land Inc. which climbed 3.9 percent to P38.90 and oil refiner Petron Corp. which advanced 3.2 percent to P10.32. Alliance Global Group Inc., the holding company of billionaire Andrew Tan, rose 3.1 percent to P15.16.
Meanwhile, equity markets in Frankfurt, London and New York ended at fresh records Monday, lifted by a rally in oil prices that boosted energy shares and by upbeat German election news.
World oil prices leapt after oil ministers from Saudi Arabia and Russia—the world’s two biggest oil producing nations—declared Sunday that they would consider extending an output cut into 2018.
That gave a boost to petroleum producers such as Royal Dutch Shell and Chevron. Mining stocks, which have heavy representation in the FTSE 100, also rose.
“We are seeing finally some rebound in the oil prices and that is definitely helping the energy sector,” said Nicholas Colas, chief market strategist at Convergex, a brokerage firm.
The news sent oil prices soaring about two percent on Monday, in turn dragging global energy firms with them.
Monday’s gains come after the commodity was battered earlier this month on worries that the production cut was not enough to make a dent in a worldwide supply glut and increasing output from the US and other nations.
“The comments from Saudi Arabia and Russia are driving prices up but I’m sceptical that crude will see a new level,” Hong Sung Ki, a commodities analyst at Samsung Futures, told Bloomberg News.
“As producers in the US are expected to increase output, prices will continue to be restricted from rising.”
But Greg McKenna, chief market strategist at AxiTrader pointed out that traders were overlooking the fact that the need for a further cut in oil output suggested problems persisted.
“That such a large output cut extension is a tacit admission of failure is for another day and discussion,” he said in a note.
Hong Kong-listed PetroChina gained almost one percent and CNOOC put on 0.4 percent, while Woodside Petroleum in Sydney was up 0.2 percent and Rio Tinto jumped 1.4 percent.
On equity markets, Tokyo edged up 0.3 percent by the close, Hong Kong slipped 0.2 percent on profit-taking in the afternoon following a six-day rally, while Shanghai finished up 0.7 percent, marking a fourth straight day of gains.
Seoul and Sydney each added 0.2 percent. But Singapore, Taipei and Wellington were all lower.
In New York the S&P 500 and Nasdaq each ended at record highs, as did London and Frankfurt, with German traders cheering a strong win for Chancellor Angela Merkel’s party in a regional vote.
In early European trade Tuesday London opened slightly higher but Frankfurt lost 0.2 percent while Paris was 0.5 percent lower. With Bloomberg, AFP
