Stocks rebounded Thursday from a two-day slump on better-than expected reading on Chinese factory output that provided fresh hope the world’s number two economy was stabilizing.
The Philippine Stock Exchange index, the 30-company benchmark, climbed 83 points, or 1.2 percent, to close at 6,864.87. Despite the gain, the bellwether was still down 1.3 percent this year.
The heavier index, representing all shares, also advanced 38 points, or 0.9 percent, to settle at 4,158.53, on a value turnover of P9.4 billion. Advancers outnumbered losers, 121 to 64, while 37 issues were unchanged.
Fifteen of the 20 most active stocks ended in the green, led by property developer Sta. Lucia Land Inc. which jumped 6.8 percent to P1.26 and infrastructure conglomerate Metro Pacific Investments Corp. which rose 3.6 percent to P6.42. SM Prime Holdings Inc. gained 3.4 percent to P27.40, while PLDT Inc. added 2.7 percent to close at P1,300.
Meanwhile, Asian equities rallied as a deal to cut global oil output lifted energy shares, while evidence of strength in the US economy sank bonds. European stocks were mixed.
Oil built on the previous day’s near 10 percent surge after Opec hammered out a last-minute deal to cut oil output for the first time in eight years.
The Opec exporters’ group, meeting in Vienna, said its 14 members had agreed on specific targets that will reduce production by 1.2 million barrels a day from next month, while key non-member Russia also committed to a reduction.
Both main contracts surged on the announcement, which ended weeks of uncertainty and volatility on crude markets as the key players bickered over who would shoulder the biggest burden of the cuts, leading to worries a deal would not be reached.
Brent and West Texas Intermediate both climbed more than one percent to sit above $50 in Asian trade, pushing regional investors back into energy firms on hopes the higher prices would boost revenues.
“The words ‘Opec’ and ‘exceed expectations’ have rarely, if ever, been used in the same sentence. However yesterday’s production deal seems to have done just that,” Jeffrey Halley, senior market analyst at OANDA, said in a note.
“Cuts have been shared across all members, including the recalcitrant Iran and Iraq.”
Still, the deal lit a fire under energy firms. Tokyo-listed Inpex was the big gainer, piling on 10 percent, while Woodside Petroleum soared more than six percent. CNOOC ploughed 6.1 percent higher in Hong Kong and PetroChina almost five percent.
Among stock markets, Japan’s Nikkei ended up 1.1 percent at its highest close this year, while Hong Kong added 0.4 percent and Shanghai closed up 0.7 percent.
Sydney gained 1.1 percent, Seoul was flat and Manila added 1.2 percent. There were also healthy advances in Singapore, Jakarta, Taipei and Wellington.
In early European trade, London was flat, while Frankfurt fell 0.4 percent and Paris shed 0.2 percent.
The removal of uncertainty provided fresh support to the dollar, which rallied towards 115 yen, its highest mark since February, before easing back slightly. And gold suffered a sell-off, sinking 1.7 percent to $1,167 as investors walked away from safe-haven assets that are popular in times of uncertainty.
In China, official figures showed a gauge of manufacturing activity had hit its highest level since mid-2014, although analysts pointed out the reading was a mixed blessing.
“Underlying data shows that this is pretty clearly heavy-industry driven, with help from credit and little contribution from consumption,” Christopher Balding, an associate professor at the HSBC School of Business at Peking University in Shenzhen, told Bloomberg News. With AFP, Bloomberg
