PSEi back to 6,200 on reduced Middle East tension

PSE index as of 03:46 PM, September 11, 2013 www.pse.com.ph

MANILA, Philippines—The local stock barometer climbed past the 6,200 mark on Wednesday as investors were relieved that another war in the Middle East could be averted.

Gaining for the fourth straight session, the main-share Philippine Stock Exchange index racked up 125.18 points or 2.06 percent to close at 6,214.90.

Local stock brokerage Regina Capital said Wednesday’s rally was “due to probability of (US) military strike against Syria becoming less likely.”

This was amid reports that US President Barack Obama was willing to pursue a diplomatic solution to the Syria crisis, heeding “encouraging signs.”  Russia earlier proposed to put Syrian chemical weapons under international control.

Another war in the Middle East would have resulted in skyrocketing oil prices which in turn are not good for an oil-importing country like the Philippines.

The local stock market has seen modest net foreign buying in the last few days, which dealers said may have likewise indicated that concerns on the US Federal Reserve’s tapering of easy money may have been digested.

All counters were up but the biggest gainer was the property (+3.25 percent) sub-index.  This was ahead of the Bangko Sentral ng Pilipinas’ monetary rate setting on Thursday (Sept. 12), during which key interest rates are widely expected to be kept at record-low levels.

Value turnover amounted to P9.22 billion.  There were 94 advancers which beat 47 decliners while 41 stocks were unchanged.