Stocks rose Friday, concluding a broadly healthy week on hopes that central banks around the world could be nearing the end of their interest rate hiking cycle.
The PSE index, the 30-company benchmark, rose 65 points, or 1.01 percent, to close at 6,602.17, as five of the six subsectors advanced.
The broader all-share index also went up by 23 points, or 0.69 percent, to settle at 3,516.72, on a value turnover of P4.68 billion. Gainers led losers, 102 to 82, while 43 issues were unchanged.
Seven of the 10 most active stocks ended in the green, led by International Container Terminal Services Inc. which climbed 6.07 percent to P213.20 and Ayala Corp. which rose 5.05 percent to P666.00. Universal Rbina Corp. added 4.11 percent to finish at P146.80.
Alternergy Holdings Corp., which held the first initial public offering this year, ended flat on its first trading day.
Alternergy hit a high of P1.30 per share from its IPO price of P1.28, before turning flat at mid-day until the close of the market.
Alternergy president Gerry Magbanua said in a news briefing he is confident about the prospects of the company given its pipeline of projects and the positive impact of renewable energy.
“Our listing at the PSE is part of the continuing growth story of Alternergy. We are listing at the PSE against a backdrop of ongoing global uncertainties. But we believe these challenges are blurred by the lasting impact of building clean and sustainable energy projects for the next generation,” he said.
Alternergy raised P1.47 billion in proceeds from the sale of 1.15 billion primary shares and 115 million in over-allotment shares. Post-IPO, Alternergy had a public float of 32.16 percent and market capitalization of P5 billion.
Alternergy said it planned to spend 35 percent of the IPO proceeds to start the construction of new projects in the next few months, including the Solana Solar Power Project in Hermosa, Bataan and the Lamut Run-of-River Hydro Project in Lamut, Ifugao.
The company will also embark on more aggressive pre-development activities for the pipeline of projects using IPO proceeds. These projects include the Ibulao Run-of-River Hydro Project, Tanay and Alabat Wind Projects and offshore wind projects.
A third of the IPO proceeds will be used to pay off liabilities in acquiring a controlling stake in the Kirahon Solar Power Project, it said.
A portion of the IPO proceeds will be allocated to general corporate requirements and working capital to operationalize the company’s retail electricity supplier license.
Meanwhile, most Asian markets traded lower Friday. Pledges by authorities to provide support to troubled lenders and depositors provided stability for investors worried that the collapse of two US banks and the takeover of Credit Suisse could usher in a new financial crisis.
The turmoil has also forced the US Federal Reserve and other central banks to change their monetary policy game plan to avoid further problems in the finance industry.
On Wednesday, the Fed announced a quarter-point rate hike—half what was expected before the latest upheaval—and indicated it could pause soon, while there is growing talk it could even begin cutting by year’s end.
Observers said an expected tightening of credit in the finance sector—caused by wary banks lending less –would allow the Fed to step back.
SPI Asset Management’s Stephen Innes cautioned: “A Fed rate cut would likely require more turmoil in the banking sector, but more importantly, how intensely the expected tighter credit market crunch will negatively impact the real economy.”
The increase came as central banks in Britain, Switzerland and Norway also raised rates, with the European Central Bank having done so last week.
Analysts said the moves indicated officials were confident the banking crisis could be contained and were still focused on bringing inflation down.
But data indicating the US jobs market remained tight highlighted the need for the Fed to stick to its policy of battling prices.
Jim Baird, at Plante Moran Financial Advisors, warned the troubles were not over yet.
“The push-and-pull between financial market stability and inflation that is receding more slowly than anyone would prefer will further complicate an already significant challenge for the Fed, increasing the risk of a policy misstep and keeping the door open for a potential recession on the horizon,” he said.
Those ongoing concerns about the economic outlook weighed on equities in Asia, despite gains on Wall Street.
Hong Kong was dragged by heavy losses in heavyweight HSBC, while Tokyo, Shanghai, Sydney, Seoul, Singapore, Mumbai and Wellington were also down.
However, Taipei, Jakarta and Bangkok rose.
Concerns about the impact on demand from a possible recession or further banking upheaval continued to weigh on oil prices, though both main contracts edged up slightly Friday, a day after falling more than one percent. With AFP