Philippines share prices closed 1.7 percent higher Wednesday on expectations that the central bank may cut interest rates as inflation continues to fall, dealers said. The composite index rose 34.31 points to 2,003.89 points. The all-shares index rose 2.08 percent, or 25.93 points, to 1,268.09.
A total of 1.66 billion shares worth 2.2 billion pesos (47.3 million dollars) changed hands. Advancers swamped declines 93 to 13 with 21 unchanged. The peso traded at 46.51 to the dollar.
"Foreign investors are returning to the market, inspired by the perception the Philippine economy may be partially insulated from the global crisis," Ron Rodrigo of DBP Daiwa Securities told Dow Jones Newswires. The government Tuesday reported that December inflation fell to 8.0 percent, easing from 9.9 percent in November.
The lower inflation rate bolstered expectations that the central bank may cut key rates in its next policy meeting later this month. Philippine Long Distance Telephone Co rose 1.4 percent to 2,160 while Ayala Land Inc added 2.9 percent to 7.20 pesos. Metropolitan Bank and Trust Co rose 7.1 percent to 26.50. San Miguel Corp, A shares were steady at 41.50 while its B shares rose 3.5 percent to 44 pesos.