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Stocks rise to new record; peso climbs to 49.9 a dollar

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Stocks closed at a new record high in the penultimate trading session of the year, following the movement of Asian markets while the peso climbed to a six-month high on strong remittances.

The Philippine Stock Exchange index, the 30-company benchmark, jumped 44 points, or 0.5 percent, to settle at 8,535.09 Thursday, eclipsing the previous all time high of 8,523.07 on Nov. 6.  This brought total gains this year to 24.8 percent.

The heavier index, representing all shares, also climbed 22 points, or 0.5 percent, to finish at 4,963.70, on a value turnover of P6.4 billion.  Gainers outnumbered losers, 107 to 105, while 38 issues were unchanged.

Thirteen of the 20 most active stocks ended in the green, led by Metropolitan Bank & Trust Co., the second largest lender, which went up 3.9 percent to P102.90 and restaurant operator Jollibee Foods Corp. which rose 2.1 percent to P254.

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At the currency market, the peso gained 6 centavos to close at 49.98 against the US dollar Thursday from 50.04 Wednesday.  It was the local currency’s strongest level since it settled at 49.91 against the greenback on June 19, 2017.

“Domestic fundamentals remain attractive. Lately reinforced by TRAIN [Tax Reform Acceleration and Inclusion Act] approval,” Bangko Sentral ng Pilipinas Governor Nestor Espenilla Jr. said in a statement.

Espenilla also said the stronger peso was due to a “combination of strong remittances and equity inflows as well as US dollar softness over uncertainty of impact of US tax legislation.”

Latest data showed that money sent home by overseas Filipinos grew 8.4 percent in October to $2.275 billion from $2.099 billion a year ago, the fastest in seven months, fueled by the increase in remittances from both land- and sea-based workers. 

This brought cash remittances in the first 10 months to $23.056 billion, up 4.2 percent from $22.124 billion a year ago.

Meanwhile, most Asian markets rose Thursday following gains on Wall Street, but with trading thin leading into the New Year break there was little to drive prices at the end of a stellar year for global equities.

But analysts warned the dollar could face pressure despite expectations for more Federal Reserve interest rate hikes over the next 12 months.

“The dollar bears are getting their last licks in for 2017 perhaps foreshadowing of things to come in 2018,” said Stephen Innes, head of Asia-Pacific trading at Oanda.

“The bears took their cue from the Conference Board consumer confidence index, which fell to its lowest level since November 2016, indicating that consumer spending may have peaked after this year’s blowout holiday season for shoppers. And retail sales data could struggle in the face of even the most modest of US rate hikes in 2018.”

The greenback edged down against the yen, pound and euro, while it was also weaker against most high-yielding currencies including the

In share trading, Hong Kong rose 0.7 percent, as did Shanghai, while Sydney put on 0.3 percent.

But Tokyo finished 0.6 percent down after an afternoon sell-off fueled by the strengthening yen.

Seoul was more than one percent higher, with Hyundai Heavy Industries—the world’s largest shipbuilder by sales—up almost four percent but making only a small dent in Wednesday’s losses of 29 percent that came after news the company will issue new stocks in a bid to shore up its ailing finances.

Bitcoin sank more than 10 percent to below $14,000 after South Korea said it would ban anonymous trading of virtual currencies and crack down on money laundering activities using them.

South Korea is one of main trading nations in bitcoin, accounting for about 20 percent of global transactions.

The digital unit has seen stratospheric growth this year, rising more than 25-fold from its January low to hit a record around $19,500 earlier this month, according to Bloomberg figures.

Oil prices climbed to sit around two-year highs. 

With AFP, Bloomberg

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