The stock market rose Monday for the fourth straight day after a blockbuster performance on Wall Street as US jobs data beat forecasts and the head of the Federal Reserve hinted at a slower pace of interest rate hikes.
The Philippine Stock Exchange Index gained 26.55 points, or 0.3 percent, to 7,787.66 on a value turnover of P8.4 billion. Gainers beat losers, 126 to 82, with 38 issues unchanged. The PSEi surged to as high as 7,900.70 in early trading before profit-taking capped the market gains.
Jollibee Foods Corp., the biggest fast-food chain, advanced 4.5 percent to P323 on expectations that the lower inflation of 5.1 percent in December would boost household consumption. Wilcon Depot Inc., a major retailer of construction supplies and materials, climbed 4.5 percent to P14.
Bloomberry Resorts Corp., which operates a casino on a reclaimed part of Manila Bay, rose 4.3 percent to P10.12, while conglomerate Ayala Corp. gained 4 percent to P998.
The rest of Asian markets rallied Monday. China’s move to make it easier for banks to lend also provided support to equities, while investors keep an eye on Beijing as negotiators begin talks to end a trade war between the world’s top two economies.
Dealers started the week on the front foot following a surge on Wall Street Friday that came after figures showed more than 300,000 US jobs were created in December, tempering recent concerns about growth.
Later that day, Fed boss Jerome Powell said the bank had no “pre-set” plan for raising borrowing costs and was keeping a close watch on financial developments.
“We’re listening... sensitively to the message that markets are sending and we’ll be taking those downside risks into account as we make policy going forward,” he told a gathering of economists.
The news was music to the ears of traders, who have been fretting that the Fed would press on with its rate hike cycle, making it more expensive to borrow for investment.
The comments saw the Dow pile on more than three percent while the Nasdaq was more than four percent higher.
They also overshadowed the budget gridlock on Capitol Hill that has shut down the US government, with Donald Trump warning it could go on for years if he is not given funding to build a wall on the Mexican border.
And the gains filtered through to Asia, where Tokyo’s Nikkei ended 2.4 percent higher, while Sydney gained 1.1 percent and Seoul jumped 1.3 percent.
Taipei surged more than two percent and Jakarta gained 0.7 percent.
Hong Kong added 0.6 percent and Shanghai finished 0.7 percent higher, with buying also boosted by news that the People’s Bank of China had cut the amount of cash banks must keep in reserve.
The move aims to free up funds for lending in a bid to grease the economy’s wheels following a string of weak data that has raised questions about the outlook.
There was also some optimism as Chinese and US officials kicked off talks to find a solution to the trade war that has seen the two sides impose tariffs in hundreds of billions of dollars worth of goods. With AFP