PSEi best performer among the indexes, benchmark PSEi rose 271.84 points or +4.35% to 6,517.49 at the closing bell. The broader All Shares advanced 126.72 points or +3.46% to 3,785.03.
Shares on the Philippine Stock Exchange climbed for the seventh consecutive day on optimism the economic fallout from the coronavirus outbreak won’t be as bad as feared after the central bank governor said monetary-easing steps were appropriate. More..
The nation’s shares have joined a global rally on hopes of the economic recovery after the coronavirus outbreak will be quick. The Philippine index has rebounded 40% from a low in March, and foreign investors are back to pouring money in the country’s equity funds this month.
It’s being driven by optimism from the reopening of economies around the world, not only the Philippines. Momentum is building up. Investors are focused on the prospects of recovery, shrugging off geopolitical risks between U.S. and China.
Expectations of a shorter contraction are building since lockdowns in Manila and neighboring areas have eased starting June 1. A sustained climb for the Philippine index above 6,100 is a signal that the rally has still some gas to test the 6,500 and beyond.
This reopening comes with risk that infections will further spread as more movements are allowed. The longer this rally goes on the more susceptible it is to profit-taking.
Government stimulus expectations also supported investor confidence in economic recovery from the global coronavirus pandemic.
Oil prices fell, reversing gains made the previous session, due to uncertainty about supply cuts by major producers.
Markets for risk assets have been on a tear, carrying some stock market indexes to within sight of levels before the coronavirus outbreak.
Liquidity provision by central banks – and expectations that more is coming – is helping to support the recent drive in risk markets.
Stock markets have risen on optimism about a possible global recovery from the coronavirus pandemic as more economies reopen despite rising case numbers
The not too bad news keeps coming, enabling the hopes for economic rebound alongside the reopening.
Companies that would most benefit from a growing economy led the market, continuing a recent trend as hopes rise that the economy and life, in general, can become closer to normal as business-shutdown orders lift.
Many professional investors have been warning that the stock market’s rally may have been too much, too soon. The recovery for the economy is likely to be much slower than the sharp rebound the stock market has just undertaken, which could be setting investors up for disappointment.
More than 2.201-bil shares valued at P11.520-bil, changed hands. Market breadth was positive as advancers outnumbered decliners, 132 to 65 and 42 issues were unchanged.
Stockbytes PH, June 5, 2020
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