|
PHILIPPINE stocks Thursday rose for the sixth day,
climbing the most in two months, after US productivity
and labor data suggested a recession may be averted in
the Southeast Asian nation’s biggest market for goods
and labor.
Ayala
Corp. and Bank of the Philippine Islands, also known as
BPI, paced gains among the nation’s biggest companies on
speculation the US Federal Reserve will cut rates this
month, helping the world’s biggest economy avoid a
slump.
“It is
safe to assume the
US
will cut its rates, and that will give the Philippine
central bank more leeway to cut its own interest rate,’’
said Rico Gomez, who helps manage about $1 billion in
assets at Rizal Commercial Banking Corp. “These cuts
will increase liquidity, and some of those funds will go
into equities.’’
Manila
Water Co. advanced for the third day and closed at a
high, after a newspaper reported that it submitted bids
for projects outside the Philippines.
The
Philippine Stock Exchange index jumped 85.25, or 2.3
percent, to close at 3,733.96, rounding a 6-percent,
six-day rally. The 32-member stock benchmark posted its
biggest gain since October 8 when it capped a six-day
rally with a 2.6-percent gain that day. The measure
climbed to its highest since November 7.
Ayala,
the second-largest Philippine company by market value,
gained P35, or 6.3 percent, to P590, its biggest advance
since August 21. Bank of the Philippine Islands, the
nation’s No. 1 lender by market value, added P2.50, or
4.1 percent, to P64, its steepest rise in three weeks.
Philippine Long Distance Telephone Co., the largest
company by market value, rose P65, or 2.1 percent, to
P3,125, a two-month high.
US
stocks overnight rose to the highest in a month after
the Labor Department said worker productivity climbed
the most since 2003 in the third quarter while labor
costs posted the biggest drop in four years. Companies
last month added 189,000 jobs, more than triple the
average forecast, a report from ADP Employer Services
showed.
Separately, federal regulators and US lenders agreed to
freeze interest rates on subprime mortgages for five
years to fend off foreclosures, a person familiar with
the measure said.
Futures
are pricing in a 58-percent chance of a quarter-point
cut to 4.25 percent when the Fed meets on December 11.
The odds of a half-percentage point cut in the Fed’s
target for the overnight lending rate between banks are
42 percent, futures contracts show.
“A rate
cut will boost liquidity, helping generate more economic
activity and stave off a recession in the US,’’ said
Astro del Castillo, managing director of Manila-based
First Grade Holding Inc., a financial management and
advisory company. “A recession in the US will hurt us
because the US is our key trading partner.’’
Manila
Electric Co., the largest Philippine power retailer,
increased P6, or 7.3 percent, to P88.50, its biggest
gain in three months. International Container Terminal
Services Inc., the biggest Philippine port operator,
which has investments in China, the Middle East and
Europe, added P2, or 4.6 percent, to P46.
The
Philippine central bank, which has cut its benchmark
interest rate a fourth time this year to help curb gains
in the peso, will meet on December 20. Philippine
inflation will be below this year’s target, central bank
Governor Amando Tetangco Jr. said Wednesday after
consumer prices in November accelerated to the fastest
in 10 months. Tetangco’s outlook boosted speculation the
central bank will again lower interest rates.
Separately, Manila Water, which serves the eastern half
of the Philippine capital, added 25 centavos, or 1.4
percent, to P18, extending a 6-percent advance in the
past two days.
The
company made bids to manage sewage and water
distribution systems in Hong Kong and Vietnam for 10 and
six years, respectively, according to a newspaper
report.
Shares
worth P5.20 billion were traded on the benchmark index,
4.9 percent less than the six-month daily average. More
than two stocks advanced for each that declined in the
broader market. |
