The broad all shares index increased by 44.20 points or 1.30 percent to 3,442.90, while the benchmark Philippine Stock Exchange index (PSEi) increased by 135.02 points or 2.14 percent to close at 6,445.01 on Wednesday.
According to Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco in a Viber message, “The decline in international oil prices lifted investors’ sentiment since it is seen to help in bringing down the country’s inflation if sustained.
Luis A. Limlingan, the head of sales at Regina Capital Development Corp., said in a Viber message that the decline in oil prices yesterday “also boosted local sentiment” as concerns about a potential drop in demand for petroleum products grew.
“Ahead of a flurry of economic reports, falling bond yields helped growth stocks in the Philippines push past the 6,400 level on the stock market. After the benchmark 10-year US Treasury yield dropped below the two-year yield, the market movements also followed, according to Mr. Limlingan.
On concerns that the demand will be weakened by a global slowdown, Brent crude futures have fallen this month. Prices fell 9.5% on Tuesday to a 2-1/2-month low of $101.10 before slightly rebounding to $103.86 a barrel on Wednesday during the Asia session, according to Reuters.
Meanwhile, a reliable market indicator of a recession capping growth in the medium term is the two-year US Treasury yield dropping below the 10-year yield.
Two-year Treasuries saw increases in yields as high as 2.95 percent, while the 10-year rate was 2.94 percent. Additionally, the curve’s two-year and five-year segments inverted for the first time since February 2020.
The inversions imply that even though investors anticipate higher short-term interest rates, they may be growing concerned about the US Federal Reserve’s capacity to control inflation without compromising growth.
Most sectoral indices here in the country finished in the green, with the exception of mining and oil, which fell by 160.64 points or 1.42 percent to 11,143.41.
Holding firms, on the other hand, increased by 219.40 points or 3.74 percent to close at 6,072.39; industrials increased by 201.47 points or 2.18 percent to close at 9,433.85; services increased by 28.28 points or 1.69 percent to reach 1,698.47; real estate increased by 37.30 points or 1.28 percent to reach 2,947.91; and financials increased by 0.38 point or 0.02 percent to reach 1,510.96.
From P3.98 billion with 509.22 million shares traded on Tuesday, value turnover increased to P5.32 billion on Wednesday with 915.72 million issues changing hands.
114 advancers closed ahead of 71 decliners, and 47 names closed unchanged.
Following a net selling of P146.06 million the day before, foreigners switched from sellers to buyers on Wednesday, with net purchases of P93.22 million being recorded.
Investors will be keeping an eye on the Fed minutes, which will be released overnight, as well as US data on mortgages and manufacturing, according to Mr. Limlingan. — Reuters’ J.I.DP. Tabile