Shares rebound on optimism over US-Iran talks

PHILIPPINE STOCKS rebounded on Wednesday on optimism over a possible resolution to the Middle East conflict and as investors picked up bargains after the market’s two-day drop.

The Philippine Stock Exchange index (PSEi) rose by 0.83% or 50.25 points to close at 6,063.35, while the broader all shares index went up by 0.58% or 19.76 points to end at 3,396.88.

“Philippine equities tracked regional gains as improving risk sentiment, driven by optimism over a potential resumption of US-Iran peace talks, lifted the global markets today,” AP Securities, Inc. said in a market note.

“The Philippine market rebounded, tracking gains in global markets and improved investor sentiment. Buying pressure emerged after a series of declines, with bargain hunting also driving the recovery,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message. “Optimism was further supported after the US President Donald J. Trump signaled that the war may be nearing an end, with talks potentially resuming this week.”

World shares edged towards record highs on Wednesday after Mr. Trump said talks with Iran could resume over the next two days, with hopes for an end to the Iran war capping oil prices at under $100 a barrel, Reuters reported.

The MSCI All-Country World Index rose 0.1%, within sight of its all-time top and on course for its ninth straight day of gains.

Signs that diplomatic engagement would continue in the Middle East helped calm markets.

Asian shares outside Japan had earlier gained 1.5% to hit the highest level in six weeks. Japan’s Nikkei climbed 0.9% while South Korea’s KOSPI index added 3%.

Brent crude futures bounced 1% to $95.77 a barrel after slumping almost 5% overnight.

With the flow of oil still effectively cut off through the Strait of Hormuz, the International Monetary Fund on Tuesday lowered its growth outlook and warned that the global economy would teeter on the brink of recession if the conflict worsens.

All sector counters ended higher on Wednesday. Financials jumped by 1.23% or 23.12 points to 1,902.16; services advanced by 1.20% or 33.67 points to 2,827.36; industrials increased by 0.62% or 54.66 points to 8,832.25; property went up by 0.61% or 12.27 points to 2,017.98; mining and oil rose by 0.32% or 59.34 points to 18,083; and holding firms inched up by 0.03% or 1.75 points to 4,648.54.

Market breadth was positive as advancers outnumbered decliners, 112 to 73, while 63 names closed Wednesday’s trading session unchanged.

Value turnover increased to P8.16 billion on Wednesday with 1.45 billion shares traded from the P5.92 billion with 1.48 billion issues that changed hands on Tuesday.

Net foreign selling increased to P1.37 billion from P446.77 million in the previous session. — Alexandria Grace C. Magno with Reuters