Stocks rebounded Friday to end a two-day slump, following reports that Japan and Europe are ready to ramp up their economic stimulus programs.
The Philippine Stock Exchange index, the 30-company benchmark, jumped 123 points, or 2 percent, to close at 6,208.05 Friday. The index, however, was still down 10.7 percent since the start of the year.
Property developers led gainers Friday. Megaworld Corp. climbed 5.5 percent to P3.27, while Ayala Land Inc. advanced 5.2 percent to P28.60. SM Prime Holdings Inc. added 2 percent to close at P19.22.
Conglomerate JG Summit Holdings Inc., the investment company of tycoon John Gokongwei, rose 5.5 percent to P60, while Alliance Global Group Inc. of tycoon Andrew Tan gained 4 percent to P13.20.
Meanwhile, Japanese stocks surged almost 6 percent Friday, leading an Asia rally, as dealers welcomed a report that the country’s central bank is planning to ramp up its stimulus program.
After a rout that has wiped several trillion dollars off global markets so far this year, the prospect that two of the planet’s biggest central banks were ready to step in finally gave investors something to cheer about.
Oil tacked on more than four percent for a second straight day, pushing prices back above $30 for the first time since last week, while emerging market currencies benefited from a newfound confidence.
On Thursday, European Central Bank boss Mario Draghi highlighted concerns about the impact of plunging equity and oil prices on already weak inflation and pledged to reconsider its monetary policy at its March policy meeting.
“We have the power, willingness and determination to act,” he told a news conference. “There are no limits how far we are willing to deploy our policy instruments.”
His comments lit a fire under European stocks and also supported a Wall Street rally.
On Friday, Japan’s respected Nikkei business daily reported that the Bank of Japan is weighing up its own plans to fend off the threat of deflation caused by the oil crisis.
The latest developments spread some much-needed confidence around trading floors after the worst start to a year ever.
Tokyo surged 5.9 percent, the best one-day performance since early September, with a weaker yen helping exporters. Hong Kong jumped more than three percent in the afternoon and Shanghai ended 1.3 percent higher.
Sydney added more than one percent and Seoul 2.1 percent, while there were also substantial gains in Taipei, Singapore and Manila. With AFP