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MANILA, Philippines – Local stocks welcomed 2013 with a bang, reaching a new all-time high on the first trading day of the year, as they took cue from world markets cheering the US’ move to avert a fiscal cliff.
On Wednesday, January 2, the Philippine Stock Exchange index rose 48.26 points or 0.8% to 5,860.99 from its December 28 close of 5,812.73. It surpassed the Dec. 26, 2012 record close of 5,832.83.
This marks the first time in 2013 that the PSEi set a new high. In 2012, the key index hit 38 new records.
“World markets have cheered the photo finish resolution of the fiscal cliff in the US. We’re off to a good start in 2013,” PSE President and Chief Executive Officer Hans Sicat said in a statement.
The broader all-share index rose 27.81 points or 0.75% to 3,726.79.
All sectoral indices ended in positive territory, led by the holding firm sector, which went up 1.33%.
A total of 2.24 billion shares worth P4.35 billion were traded.
Top traded stock SM Investment Corp. climbed 2.04% to P900 per share, followed by BDO Unibank Inc., which inched up 0.27% to P73 apiece.
Asian, US markets
In the region, shares also rose sharply due to the positive development in the US, the world’s biggest economy.
Hong Kong was the biggest riser in Asia, up 2.19% at a 19-month high, receiving an additional boost from positive Chinese manufacturing data. Sydney gained 1.23%, or 57 points, to 4,705.9, and Seoul rose 1.76%.
Financial markets in Japan and mainland China were closed for a public holiday.
The US House of Representatives approved a bill avoiding tax hikes for most Americans and delays in automatic spending cuts. The move had been urged in the past to prevent the US economy from “falling off the cliff” or going back into recession.
Jason Hughes, head of premium client management for IG Markets Singapore, said market reaction to the fiscal deal was “very positive.”
“With the final hurdle being passed now, we’ve got a minimum deal that avoids any immediate threat of the US falling off the cliff… that’s definitely boosted Asian equities markets,” he said.
The gains followed jumps in US stocks on New Year’s Eve as Congress moved toward a deal.
The Dow Jones Industrial Average finished up 1.28%, the S&P 500 gained 1.69% and the tech-rich Nasdaq Composite surged 2%.
The upbeat start for shares in 2013 will be a relief for investors after the uncertainty that clouded markets in the final months of last year as wrangling over the fiscal cliff dragged on. – Rappler.com, with a report from Agence France-Presse
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