The stock market rallied Friday on bargain hunting after a tough week dominated by the US Federal Reserve’s hawkish tone that has set it on an aggressive tightening path.
The Philippine Stock Exchange surged 91.99 points, or 1.3 percent, to 7,018.02 on a value turnover of P4 billion. Gainers beat losers, 101 to 66, with 54 issues unchanged.
International Container Terminal Services Inc., the biggest operator and owned by tycoon Enrique Razon Jr., advanced 3.2 percent to P225, while fiber broadband provider Converge ICT Solutions Inc. rose 2.9 percent to P28.65.
AC Energy Corp. of the Ayala Group climbed 2.3 percent to P8.54, while sister unit Bank of the Philippine Islands, the third-largest lender in terms of assets, added 2.1 percent to P98.50.
Asian markets mostly rose Friday while oil ticked higher after another series of losses.
After a slow start, the region managed to take the lead from Wall Street, which recovered from steep intra-day losses to end on a positive note, having plunged in previous sessions as traders fretted over the prospect of higher interest rates.
While the Fed has made clear it intends to act more decisively to rein in 40-year-high inflation by ramping up borrowing costs and offloading bond holdings, analysts suggested that better clarity on policy was welcome.
The Fed’s desire to tighten has sent the dollar rallying against most other major currencies, particularly the euro, which has been weighed by European officials’ reticence to move as aggressively on prices. The euro is sitting around a one-month low.
Markets have come under huge pressure this year as the end of ultra-cheap central bank cash, a COVID-fueled slowdown in China’s economic activity, the war in Ukraine and soaring inflation come together in a perfect storm.
Highlighting the difficult task central banks will have in fighting inflation, the UN’s Food and Agriculture Organization said Friday that world food prices hit their “highest levels ever” in March as Russia’s invasion of Ukraine disrupted wheat and coarse grain exports.
Still, all three indexes on Wall Street ended slightly higher, having bounced back from heavy losses thanks to bargain-buying, while some observers suggested recent selling may have gone too far.
Asia saw a tepid start but most markets enjoyed mild gains towards the end of the day.
Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Taipei, Mumbai, Jakarta and Bangkok all rose, though Singapore and Wellington were lower.
Still, OANDA’s Jeffrey Halley warned traders were “growing warier about China as the Shanghai lockdown drags on” owing to the fast-spreading Omicron virus variant.
“China’s COVID-zero policy continues to be its Achilles heel, although there are plenty of other reasons to be a little cautious,” he said in a note.
“A serious spread outside of its finance and commercial center to other large cities will be a big headwind for China’s growth, China stocks, and by default eventually, much of Asia.”
Crude prices edged up having also endured a downcast week after the United States and allies pledged to release more than 200 million barrels over the coming months to offset the loss of Russian supplies. With AFP