Bargain hunting lifts PSEi back to 6,000 level

Philippine shares rebounded on Wednesday as investors took advantage of lower prices following the market’s seven-day losing run.

The Philippine Stock Exchange index (PSEi) jumped by 1.21% or 72.57 points to close at 6,026.03, while the broader all shares index rose by 0.93% or 33.83 points to end at 3,654.62.

“The PSEi climbed back above the 6,000 mark, breaking its red streak as bargain hunters drove today’s trading session. Investors seized the opportunity to accumulate stocks at cheaper levels after the sharp declines over the past week.” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“The index reclaimed the 6,000 level, with bargain hunting fueling a rebound after seven consecutive days of decline,” AP Securities, Inc. said in a note.

The PSEi hit multi-month lows in the last few sessions as worries over domestic corruption issues and a lack of strong trading drivers caused sentiment to weaken.

“The market still needs stronger catalysts for a sustainable reversal of the prevailing downtrend,” Mr. Limlingan said.

He added that gains on Wall Street overnight also supported market sentiment.

“US equities finished the quarter on a solid note, with the S&P 500 and Nasdaq Composite advancing on the back of renewed interest in technology heavyweights. Investors focused on corporate momentum and the potential for future monetary easing.”

However, on Wednesday, Wall Street futures fell, gold struck a record high and the dollar eased as the US government shut down much of its operations, possibly delaying the release of crucial jobs data that could muddy the interest rate outlook, Reuters reported.

With no clear path out of the impasse over a funding deal, agencies warned the government shutdown would halt the release of a closely watched September employment report and lead to the furlough of 750,000 federal workers at a daily cost of $400 million.

Both S&P 500 futures and Nasdaq futures dropped 0.5% on Wednesday.

Back home, all sectoral indices closed in the green on Wednesday. Mining & oil jumped by 3.18% or 409.17 points to 13,246.67; services surged by 1.91% or 41.25 points to 2,193.64; industrials rose by 1.19% or 104.65 points to 8,882.30; property increased by 1.08% or 24.60 points to 2,302.79; financials climbed by 0.93% or 19.23 points to 2,072.77; and holding firms went up by 0.6% or 29.72 points to 4,910.45.

Value turnover went down to PHP 6.8 billion on Wednesday with 2.46 billion shares traded from Tuesday’s PHP 9.09 billion with 1.57 billion shares changing hands.

Market breadth was positive as advancers outnumbered decliners, 99 to 87, while 50 names closed unchanged.

Net foreign selling went down to PHP 1.03 billion on Wednesday from PHP 2.01 billion on Tuesday. — Alexandria Grace C. Magno with Reuters