PSEi back above 6,300 mark as cease-fire holds

Philippine shares closed higher for a second straight day on Wednesday, with the index returning above the 6,300 mark, on optimism over a long-term cease-fire between Iran and Israel.

The benchmark Philippine Stock Exchange index (PSEi) rose by 0.52% or 32.89 points to end at 6,325.64, while the broader all shares index went up by 0.4% or 15.23 points to 3,754.43.

“The local market extended its rise on the back of hopes that the Israel-Iran cease-fire would hold,” Philstocks Financial Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message. “Investors also cheered the effect of the said cease-fire on other relevant markets, including the decline in global oil prices and the rebound of the Philippine peso against the US dollar.”

“Philippine shares rose and oil prices sank Tuesday as markets welcomed a fragile cease-fire between Israel and Iran, despite mutual accusations of violations. US President Donald J. Trump confirmed the truce remains in effect, though he voiced frustration with both sides,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

The cease-fire brokered by Mr. Trump between Iran and Israel appeared to be holding on Wednesday a day after both countries signaled that their air war had ended, at least for now, Reuters reported.

Each side claimed victory on Tuesday after 12 days of war, which the US joined with airstrikes in support of Israel to take out Iran’s uranium-enrichment facilities.

Mr. Trump’s Middle East envoy, Steve Witkoff, said late on Tuesday that talks between the United States and Iran were “promising” and that Washington was hopeful for a long-term peace deal.

On Wednesday, Brent crude rose 2% to USD 68.43 per barrel, bouncing a bit following a plunge of as much as USD 14.58 over the previous two sessions. US West Texas Intermediate crude was up as much to trade at USD 65.60 per barrel.

At home, the peso returned to the PHP 56 level on Wednesday as risk appetite improved, closing at PHP 56.711 per dollar, jumping from Tuesday’s finish of PHP 57.16.

The conflict in the Middle East had caused the peso to slide to the PHP 57 level last week after starting June at the PHP 55 level on concerns that rising oil prices would stoke inflation anew. The Philippines is a net importer of oil.

Majority of sectoral indices closed in the green on Wednesday. Property climbed by 1.93% or 42.81 points to 2,251.04; mining and oil increased by 1.49% or 145.21 points to 9,893.96; holding firms went up by 0.76% or 40.89 points to 5,399.45; and services rose by 0.65% or 14.21 points to 2,185.63.

Meanwhile, financials dropped by 0.24% or 5.65 points to 2,318.29 and industrials slipped by 0.02% or 1.86 points to 9,064.84.

Value turnover dropped to PHP 4.67 billion on Wednesday with 616.14 million shares traded from the PHP 5.81 billion with 1.13 billion issues exchanged on Tuesday.

Advancers outnumbered decliners, 97 versus 83, while 60 names were unchanged.

Net foreign selling increased to PHP 331.5 million on Wednesday from PHP 286.36 million on Tuesday. — R.M.D. Ochave with Reuters