Philippine stocks bounce back

MANILA, Philippines—Most local stock prices rebounded sharply on Wednesday, clawing back some gains for 2011, as investors took heart from the US Federal Reserve’s assurance that interest rates would be kept at record-low levels through 2013.

The main-share Philippine Stock Exchange index added 133.11 points, or 3.2 percent, to close at 4,290.14, ending a three-day slump. This was the sharpest single-day gain seen by the market so far this year.

The index is now ahead by 2.1 percent from the end-2010 level of around 4,200, recuperating from the previous session’s bloodbath.

This developed as the US Fed’s statement assuring an extended period of low interest rate regime perked up Wall Street overnight, inspiring investors to scout for bargains after the three-day slump in the local market.

“The Philippine market rebounded after Asian and the US markets cheered the US Federal Reserve’s move to keep a lid on key interest rates. This is a positive signal for all markets and should bode well in terms of investor confidence,” PSE president and chief executive officer Hans Sicat said.

All counters were up but the mining/oil led the day’s recovery, rising by 6.26 percent on the back of record-high gold prices.

The interest rate-sensitive property and financial counters likewise went up by 4.39 percent and 3.79 percent, respectively.

The industrial and holding firm counters were both up by 2 percent.

Turnover amounted to P7.62 billion.

Foreign investors were still on a net selling position to the tune of P510 million as some global investors pocketed gains from the local market to compensate for losses from other markets. But that was much lower than the net foreign selling of P1.54 billion on Tuesday and P1.63 billion on Monday.

There were 149 advancers against only 17 decliners while 17 stocks were unchanged.

Mining stocks Lepanto “A” (for local investors) and Philex led the PSEi’s upswing alongside Ayala Corp., EDC, Lepanto “B’ (for local and foreign investors), PLDT, DMCI, BDO, Metrobank, Megaworld. Aboitiz Power, AGI, Jollibee and ALI.

Zeus, San Miguel Corp., Semirara and Atlas also gained in heavy trade.

Overnight, the Dow Jones Industrial Index jumped by 429.92 points, or 3.98 percent, to 11,239.77 as the US Fed’s assurance of a low interest environment calmed Wall Street.