Stocks rebounded Wednesday from the previous day’s losses in line with the movement of Asian bourses, as US President Donald Trump’s measured response to North Korea’s missile launch and upbeat US data restored a semblance of calm to markets.
The Philippine Stock Exchange index, the 30-company benchmark, rose 8 points, or 0.1 percent, to close at 7,956.73, as four of the six major sectors advanced.
The heavier index, representing all shares, also gained 1 point to settle at 4,722.00, on a value turnover of P5.9 billion. Losers outnumbered gainers, 101 to 91, while 53 issues were unchanged.
Ten of the 20 most active stocks ended in the green, led by hotel and gaming company Bloomberry Resorts Corp. which climbed 3.5 percent to P11.14 and food manufacturer Universal Robina Corp. which gained 1.1 percent to P148.90. Puregold Price Club Inc. rose 0.7 percent to P48.30.
Most Asian markets also traded higher, as the rush to the sidelines that followed Pyongyang’s launch of a rocket over Japan Tuesday abated through the day as initial fears subsided, while the dollar clawed back losses against the yen and euro.
While Japanese Prime Minister Shinzo Abe called the launch “an unprecedented, serious and grave threat”, Trump –who had warned of “fire and fury” over a previous rocket test—said only that “all options” were on the table.
North Korean leader Kim Jong-Un has promised more missile flights over Japan, insisting his nuclear-armed nation’s provocation was a mere “curtain-raiser”, in the face of UN condemnation and US warnings of severe repercussions.
But while analysts said the North Korea threat was still apparent, unease had been soothed by the fact that Trump and Abe were sticking to a diplomatic line and the UN Security Council had met.
“With a toned-down President Trump and the UN Security Council in closed-door meetings with economic sanctions the preferred option, the world just feels like a safer place today, and investors are relishing this respite,” said Oanda head of Asia-Pacific trading Stephen Innes.
On equity markets Seoul—which ended down 0.2 percent Tuesday after losing more than one percent in the morning—added 0.3 percent and Tokyo’s Nikkei finished 0.7 percent higher, helped by a weaker yen.
Hong Kong rallied 1.2 percent in the afternoon and Singapore put on 0.5 percent, while Sydney, Wellington, and Taipei closed higher. However, Shanghai ended 0.1 percent down after late selling.
In early European trade London and Paris each rose 0.5 percent and Frankfurt added 0.7 percent.All three had ended sharply lower on Tuesday.
“The ‘risk off’ sentiment that overshadowed markets after the launch of yet another missile from North Korea didn’t even last 24 hours,” David de Garis, director at National Australia Bank, said in a commentary.
The dollar plunged Tuesday to as low as 108.50 yen as dealers rushed for safe investments but managed to bounced back later in the day and in early Asian trade was at 110 yen.
The greenback also picked up against the euro, a day after the single currency broke above $1.2000 for the first time since January 2015 on expectations the European Central Bank will soon start cutting down its stimulus, while talk of fresh Federal Reserve interest rate rises has eased.
The US unit was supported by bargain-buying and a strong consumer confidence reading, while dealers are upbeat about upcoming US jobs data on Friday. With AFP, Bloomberg