Stocks rise; Ayala Land, SMIC top gainers
STOCKS rose Tuesday as investors await this week’s interest rate decisions by the US Federal Reserve and JPMorgan moved to absorb the troubled First Republic Bank.
The PSE index, the 30-company benchmark, gained 47 points, or 0.72 percent, to close at 6,672.69 as three of the six subsectors advanced.
The index representing all shares also went up 14 points, or 0.40 percent, to settle at 3,546.69 on a value turnover of P4 billion. Gainers led losers, 103 to 83, while 48 issues were unchanged.
Five of the 10 most active stocks ended in the green, led by Ayala Land Inc. which climbed 3.19 percent to P27.50 and SM Investments Corp. which went up 2.79 percent to P920.00.
Meanwhile, Asian trading was mixed Tuesday. At the start of a news-jammed week that includes a policy decision by the Federal Reserve and a report on US employment figures, all three major US indices finished in the red.
Adding to investor uncertainty were raised fears about the banking sector after another US regional lender went under.
Regulators announced the seizure of First Republic on Monday and that it had been sold to JPMorgan Chase, making it the second biggest bank by assets to collapse in US history.
“The collapse of First Republic saw JPMorgan step up to the plate and squash the biggest market risk on the table,” said Edward Moya of the OANDA trading platform in a note.
“It is looking like the stress for the smaller banks is over as we now have a playbook to help the next bank that runs into trouble.”
The takeover of First Republic came after the collapse of three midsized lenders in March, including the high-profile failures of Silicon Valley Bank (SVB) and Signature Bank -- which rattled markets and raised contagion worries.
But Jack Ablin, chief investment officer at Cresset, added that the latest deal would go “a long way to calm investors’ concerns” about the turmoil in the sector.
Multiple markets in Asia resumed trading after a holiday weekend, though bourses in mainland China remained closed.
Hong Kong stocks pared early gains but closed in the green, while Tokyo stocks swung before ending higher— with the Nikkei 225 seeing its highest close since August last year, having advanced for four straight sessions.
Japanese markets are closed for the rest of the week.