MANILA, Philippines — The Philippine financial markets marked the first trading day of 2009 with a bang, as investors returned from a long holiday break with pent-up energy and fresh optimism inspired by upbeat Wall Street trading.

The peso rallied Monday and rose by about 7.6 percent to close at a three-month high of 47.16 to the dollar, and the Philippine Stock Exchange index (PSEi) surged 5.43 percent to close at 1,974.69, the highest in more than a month.

Buoyed by foreign exchange remittances by overseas Filipinos, which accumulated during the long Christmas break, the peso is now heading toward the 47-per-dollar level and the PSEi will likely test the 2,000-point mark soon, Banco de Oro Unibank strategist Jonathan Ravelas said.

Ravelas said the rosy financial markets were also supported by a much-improved inflation outlook this year.

Marcelo Ayes, senior vice president at Rizal Commercial Bank, said the peso’s rise was part of a region-wide, short-term correction of the dollar’s rapid strengthening against global currencies.

Ayes added that an anticipate drop in interest rates — as the central bank seeks to boost the local economy given a major global downturn — would be good for stocks but bad for the peso over the long run, as investors would likely search for higher yields.

With a relatively thin volume of $486 million on the currency spot market, Ayes also said, the peso would likely attempt to touch 47.00 to the dollar on the topside but then head toward 47.50 and then 47.85.

“This [rally] is not yet decisive because the offshore participants are not here yet,” he said.

The peso ended 2008 at 47.52 to the dollar, about 13 percent weaker than a year earlier, after a 19-percent gain posted in 2007 when it became Asia’s best-performing currency.

The stock exchange Monday posted the biggest increase in its main-share index since Nov. 25 when it rose by 6.03 percent or 108.46 points.

“We are tracking Wall Street’s advance Friday and the rest of the holiday gains when the market was still closed,” Accord Capital Equities trader Justino Calaycay said.

Philippine financial markets were closed for nearly two weeks since Dec. 24 for the Christmas and New Year holidays.

On Monday, traders said, stock investors went on a buying spree, inspired by the rallies on Asian equities and Wall Street stocks.

Investors seemed to find encouragement after President-elect Barack Obama urged congressional leaders Saturday to move quickly on recovery measures, analysts said. With editing by INQUIRER.net