Shares jump to one-month high on US-Iran deal

PHILIPPINE SHARES advanced on Wednesday to a near one-month high, joining a global relief rally across risk assets after the United States and Iran forged a temporary ceasefire.

The Philippine Stock Exchange index (PSEi) climbed by 2.21% or 132.04 points to close at 6,089.91, while the broader all shares index went up by 1.94% or 65 points to end at 3,415.16.

This was the PSEi’s highest close since it ended at 6,113.58 on March 12. This also marked the index’s biggest one-day climb since Jan. 6, when it jumped by 2.49% or 153.38 points to finish at 6,317.91.

“The Philippine market closed significantly higher, driven by a sharp shift in global sentiment after the United States and Iran agreed to a temporary two-week ceasefire, easing geopolitical tensions and boosting risk appetite,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message. “This development also strengthened the peso and improved investor confidence, further supporting gains in the market.”

“The local market surged as the US-Iran two-week ceasefire fueled investors’ optimism. Persuaded by Pakistan, the US has suspended its attack on Iran’s critical infrastructures for two weeks subject to Iran completely opening the Strait of Hormuz. This caused global oil prices to plunge and the peso to strengthen against the US dollar, all contributing to the local market’s ascent,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

The peso strengthened by 90 centavos to end at P59.43 against the greenback on Wednesday from its P60.33 finish on Tuesday. This was also its strongest close since March 12’s P59.385.

Oil prices sank below $100 a barrel on Wednesday after US President Donald J. Trump announced a two-week ceasefire with Iran that brought some relief to markets on hopes for a resumption of oil and gas flows through the Strait of Hormuz, Reuters reported.

Brent oil futures were last down 13.8% at $94.27, while US crude futures were down 15.4% at $95.55 a barrel, but were still well above pre-war levels.

All sector counters closed in the green on Wednesday. Mining and oil surged by 6.86% or 1137.63 points to 17,710.43; property advanced by 4.39% or 87.05 points to 2,068.49; financials increased by 2.2% or 41.56 points to 1,926.99; services went up by 1.92% or 51.98 points to 2,751.94; holding firms rose by 1.87% or 87.31 points to 4,746.27; and industrials climbed by 0.8% or 70.52 points to 8,843.95.

Advancers outnumbered decliners, 158 to 47, while 57 names closed unchanged.

Value turnover climbed to P8.33 billion on Wednesday with 1.12 billion shares traded from the P5.82 billion with 1.27 billion issues that changed hands on Tuesday.

Net foreign selling decreased to P437.45 million from P992.33 million in the previous session.

Philippine financial markets are closed on Thursday (April 9) for the Day of Valor holiday. — A.G.C. Magno with Reuters