Peso up further, PSEi rebounds as fears ease

THE peso gained anew on Friday, and the stock market recovered on news of lifelines extended to troubled financial institutions.

The currency strengthened by 15 centavos to close at P54.71 against the dollar while the benchmark Philippine Stock Exchange index (PSEi) jumped by 64.81 points, or 1.01 percent, to 6,469.72.

The broader All Shares added 0.59 percent, or 20.45 points, to settle at 3,464.27.

Claire Alviar, research associate at Philstocks Financial Inc., said the rebound was due to the easing of banking fears following the financial help received by First Republic Bank and Credit Suisse.

Credit Suisse was given $54 billion by the Swiss central bank after a major investor said it could not provide additional funding, while First Republic received $30 billion from major US banks.

The lifelines were prompted by the successive failures of two US regional banks, Silicon Valley

Bank and Signature Bank, over the weekend.

“Foreigners also supported the market,” Alviar added, “recording a net inflow of P14.81 million.”

“Chart-wise, support remains at 6,400 while resistance is pegged at the 6,600 level,” she continued.

“Net market value turnover was also strong at P7.02 billion, higher than this month’s average so far of P5.83 billion.”

Rizal Commercial Banking Corp. chief economist Michael

Ricafort, meanwhile, said the PSEi “corrected higher after the biggest budget surplus in nearly four years with narrower estimates for current account and balance of payment deficit and higher GIR (gross international reserve) estimates by the Bangko Sentral ng Pilipinas.”

“Another thing to note is that the European Central Bank raised its main refinancing rate by 0.50 to 3.50 percent, in line with market estimates, as Credit Suisse crisis fears eased,” he added.

The peso opened at P54.75:$1, the day’s high, and traded as low as P54.61. Volume reached $880 million, slightly higher than the $799 million recorded on Thursday.

At the stock market, all sectoral indices closed out the week in the green, led by a 1.75-percent gain for financials.

Just under 1.02 billion shares worth P8.5 billion changed hands.

Advancers outnumbered decliners, 102 to 79, while 57 remained unchanged.