The stock market surged Friday after S&P Global Ratings raised its outlook on the Philippines’ credit rating from “stable” to “positive,” citing the government’s policy making could further improve the country’s finances and economic growth.
The Philippine Stock Exchange Index rose 103.60 points, or 1.4 percent, to 7,721.02 on a value turnover of P7 billion. Gainers overwhelmed losers, 124 to 69, with 52 issues unchanged.
S&P’s positive outlook on the current rating of “BBB,” which is one notch above the minimum investment grade, means there is a chance the rating could be upgraded in the coming months.
Metro Pacific Investments Corp., which is into toll roads, water and electricity distribution and hospitals, climbed 5.5 percent to P4.82, while unit Manila Electric Co., the biggest power retailer, advanced to P314.20.
Conglomerate Ayala Corp. gained 3.2 percent to P960, while SM Investments Corp. of retail tycoon Henry Sy Sr. added 2.6 percent to P910.
Meanwhile, Seoul’s Kospi was among the best performers Friday and the won strengthened as the leaders of North and South Korea held a historic summit, while other Asian markets also enjoyed gains following a US rally.
Tokyo gained 0.7 percent, while Hong Kong added 0.8 percent, Shanghai climbed 0.2 percent, Sydney put on 0.7 percent and Singapore was 0.2 percent higher. Wellington added more than one percent while there were also healthy gains in Taipei and Bangkok.
After fluctuating through the week, regional stocks were on course for a positive finish as Kim Jong Un and Moon Jae-in met on the border of the rival countries for talks expected to touch on Pyongyang’s nuclear program.
Kim said he was “determined to send a starting signal at the threshold of a new history,” while Moon said he was hoping for “a bold agreement so that we may give a big gift to the whole Korean people and the people who want peace.”
With hopes for a positive outcome from the meeting—the first between the countries’ leaders since 2007—Seoul stocks rose 0.7 percent in early trade, while the won climbed 0.4 percent against the dollar.
“Of course we should always be on guard for a negative development… but as far as we can tell from the recent remarks by North Korea, the summit will be reconciliatory,” Makoto Sengoku, market analyst at Tokai Tokyo Research Institute, told AFP.
The upbeat mood from the meeting coincided with a much-needed rally across US markets thanks to another round of healthy corporate earnings.
US technology firms enjoyed a much-needed lift after Facebook posted a 63-percent rise in first-quarter profit, undented by a consumer data scandal.
The social media giant’s shares soared 9.1 percent while other tech titans also climbed, with Amazon, Google parent Alphabet and Microsoft all up around two percent or more.
“Not surprisingly, earnings season continues to dominate the equity landscape as investors revel in the fantastic profit results and confirming a three percent ten-year (Treasury) yield is of little concern to the markets,” said Stephen Innes, head of Asia-Pacific trading at OANDA.