Stocks rebounded Wednesday on bargain hunting and gains in Wall Street overnight after suffering heavy losses in the previous sessions.
The Philippine Stock Exchange Index jumped 150.64 points, or 1.9 percent, to 7,917.39 on a value turnover of P6.6 billion. Gainers beat losers, 112 to 75, with 60 issues unchanged.
Banks led gainers, with BDO Unibank Inc., the biggest lender in terms of assets, climbing 4 percent to P149.80. Economists expect the Monetary Board of the Sentral ng Pilipinas to reduce policy rates by 25 basis points in today’s meeting.
Security Bank Corp., the sixth-largest, advanced 5.2 percent to P182.40, while Bank of the Philippine Islands, the third-biggest, surged 6.2 percent to P94. SM Investments Corp. of the Sy Group rose 3.1 percent to P990.
The rest of Asian markets, meanwhile, largely extended their losses on Wednesday despite Wall Street registering strong gains as investors remained on edge over escalating US-China trade tensions.
The losses in Asia came despite a gain of more than one percent for US indices as Wall Street recovered from a multi-session losing streak that saw the Dow hit its lowest level this year.
Equities had tumbled Monday after Beijing allowed the yuan to slide sharply against the dollar following President Donald Trump’s announcement that he would impose 10 percent tariffs on another $300 billion in Chinese goods starting September 1.
But Beijing’s move to stabilize the yuan after it dropped below the key 7.0 per dollar threshold helped to ease fears of a currency war despite Washington formally branding China a “currency manipulator.”
“The move… to strengthen the yuan calmed markets after a drop on Monday. Emerging markets got some breathing room and rebounded,” said Edward Moya, senior market analyst at OANDA.
But he warned that “trade war concerns remain very much front of mind… at this point more details and statements from both sides are needed to inject calm into a volatile market”.
Tokyo shed 0.3 percent, Shanghai also dropped 0.3 percent and Seoul lost 0.4 percent.
But Hong Kong closed modestly higher, ending a week-long losing streak after spending much of the day in the red as investors remained tense over the US-China trade war.
Mumbai was flat after India’s central bank cut interest rates for the fourth time this year—in line with expectations—as New Delhi battles sluggish economic growth and record unemployment.
But other emerging markets saw gains, with Jakarta climbing more than one percent.
US-China trade tensions have risen sharply since last week following Trump’s latest tariffs announcement, which would subject virtually all of the $660 billion in goods traded between the world’s two top economies to punitive duties.
The yuan’s slump fueled speculation that Beijing was devaluing the currency to support exporters and offset the tariffs threat, infuriating Washington.
Multiple rounds of tit-for-tat tariffs between the two countries have already battered trade and raised fears for the health of the global economy. With AFP