The Philippine stock market ended with an unexpected gain on Thursday, buoyed by the mining sector, even as Asia’s benchmark stock index posted its seventh loss in eight days over concerns Europe will fail to contain its debt crisis.
The benchmark Philippine Stock Exchange index (PSEi) closed up 20.88 points, or 0.49 percent, to 4,290.14, just below the near-term resistance of 4,320.
The measure outpaced the rise in the broader all-shares index, up 0.29 percent, due to gains from gold miners Lepanto Consolidated Mining Co. and Philex Mining Corp. Gold prices went above $1,800 an ounce to mark a new record on Thursday before pulling back to about $1,788 per ounce at press time.
Prices of the mineral, considered a safe haven during times of uncertainty, have been on the rise since Standard & Poor’s downgraded the US credit rating by a notch on Friday.
Market observers said the move by investors into mining firms helped lift the PSEi from what could have been another day of losses.
“Just before the [S&P] downgrade, a lot of investors were already in mining so they are coming back. The reason is gold is at an all-time high,” Joseph Roxas, president of local stock-brokerage firm Eagle Equities Inc., said in a phone interview on Thursday.
“Mining stocks, particularly those into gold, serve as favorites now as gold prices ascend amid a flight to safety by global investors,” Prince Anthony A. Yeung, equities analyst at AB Capital Securities Inc., said in a report.
The gains in Philippine equities came despite another session of heavy losses on Wall Street the previous night, this time due to rumors that France may be the next European nation to face a sovereign-rating downgrade. Those rumors were quelled when the three major ratings agencies affirmed that country’s AAA rating.
The MSCI Asia Pacific Index dropped 0.5 percent to 122.28 in Tokyo on Thursday. It earlier dropped as much as 2.4 percent as global growth concerns escalated after the cost of protecting the government debt of Greece, Italy, Spain and France rose.
Meanwhile, domestic equities remained active on Thursday with P7.02 billion worth of stocks changing hands. Net foreign selling was little changed at P545.7 million.
Still, volatility will continue as long as uncertainties remain in the developed world. “The turmoil over in the euro zone and the mess over in the US will persist, serving as a great weight pressing down on the market,” Yeung said.
IN PHOTO -- A TRADER uses his mobile phone to take a picture of the electronic board at the Philippine Stock Exchange in Makati City on Thursday. While Asian stock markets followed Wall Street lower as concerns mounted over the worsening debt crisis in Europe and a slackening global economy, the Philippine Stock Exchange index rose slightly for a second day. --AP
