Stocks rose for a second day as more pledges of government support soothed worries over the US banking sector and provided some much-needed stability after more than a week of upheaval.
The PSE index, the 30-company benchmark, gained 15 points, or 0.24 percent, to close at 6,546.27, as four of the six subsectors advanced.
The broader all-share index also went up 6 points, or 0.19 percent, to settle at 3,499.97 on a value turnover of P4.23 billion. Gainers outnumbered losers, 98 to 77, while 49 issues were unchanged.
Eight of the 10 most active stocks ended in the green, led by PLDT Inc. which climbed 4.46 percent to P1,381.00 and Robinsons Land Corp. which rose 3.31 percent to P14.34.
Most Asian markets also traded higher Wednesday.
The dialing down of volatility allowed traders to turn their focus on the US Federal Reserve’s policy decision later in the day, with the recent turmoil fueling hope it will hold off on an expected sharp hike in interest rates.
With the recent crisis blamed on the central bank’s steep hike in borrowing costs over the past year, pressure is building on officials to pause their monetary tightening campaign, with many observers even tipping several cuts by the end of the year.
While that would deal a blow to the Fed’s fight against elevated inflation, such a move is seen by observers as crucial to reinforcing stability and preventing another blow-up in the financial sector.
US and European markets surged at least one percent Tuesday, building on Monday’s advances, as investors cheered comments from US Treasury Secretary Janet Yellen reiterating support for lenders after the collapse of two regional banks earlier this month.
The downing of Silicon Valley Bank and Signature Bank forced authorities to promise customers would not lose their cash in a bid to prevent a run on other firms.
“Our intervention was necessary to protect the broader US banking system, and similar actions could be warranted if smaller institutions suffer deposit runs that pose the risk of contagion,” Yellen told an American Bankers Association conference in Washington.
She added that the government was “resolutely committed” to ensuring stability and that “the public should have confidence in our banking system”.
OANDA’s Edward Moya said in a note: “It is a clear message from multiple officials that they are not taking this banking turmoil lightly and that they will probably be proactive when the next major risk arises.”
The US and European rally filtered through to Asia, where banks were among the big gainers with tech firms.
Hong Kong was boosted by a bump in lenders HSBC and Standard Chartered as well as e-commerce titans Alibaba and JD.com.
Tokyo was up nearly two percent as investors returned from a public holiday, while Seoul, Singapore, Sydney and Taipei were up by more than one percent.
Shanghai, Wellington, Mumbai and Bangkok also rose. With AFP