Philippines share prices closed 4.52 percent higher on Friday, hitting their best levels in three weeks following the easing of interest rate concerns after the US Federal Reserve meeting, dealers said.
The Fed raised interest rates 25 basis points to 5.25 percent late Thursday as expected but the language it used to describe the economic and inflation outlook was changed, which the markets took to signal a softer stance.
There had been concerns going into the Fed meeting that it could raise rates by as much as 50 points or signal more hikes to come but in the event, the outcome was seen as indicating it will soon pause on rates. That gave Wall Street a massive boost and set all the regional markets up for strong gains Friday.
Locally, dealers said the Fed move should mean the Philippine central bank, which kept its key interest rates steady for a ninth policy meeting in a row on Thursday, to maintain its stance moving forward, supporting equities. The composite index gained 94.17 points to 2,178.79 after trading between 2,084.62 and 2,182.00. Volume was 1.53 billion shares worth 3.44 billion pesos (64.6 million dollars). The all-shares index rose 45.45 points to 1,369.89. Gainers led losers 77 to 14, with 28 stocks unchanged.
The peso was at 53.242 to the dollar. "People are making a bet that the 17th rate hike on Thursday or the next possible rate hike in August in the US will be enough to knock out inflation (there)," said Nestor Aguila of DA Market Securities.
Top-traded Philippine Long Distance Telephone closed up 90 pesos at 1,830.
Among other blue chips, Ayala Corp gained 20 pesos to 370, Ayala Land rose 50 centavos to 11.50 pesos and Bank of the Philippine Islands advanced 4.50 pesos to 50. San Miguel A shares rose 50 centavos to 65.50 pesos while its B shares added one peso to 73.
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