Phl stocks climb after Spain pledges to cut spending

MANILA, Philippines - Asian stock markets including the Philippines rose yesterday after Spain announced severe budget cuts meant to show international lenders and investors that the country is taking steps toward getting its debt under control.

The Spanish government on Thursday unveiled a draft budget for 2013 that cuts overall spending by €40 billion ($51 billion). Wall Street spurted higher on the news. Many economists see the cost-cutting as a signal Spain is preparing to request financial aid from other governments and the European Central Bank.

At the Philippine Stock Exchange (PSE), the main composite index rose 44.61 points to close at 5,346.10, while the broader all-share index went up 19.70 points to 3,549.65.

Most sectoral indices closed in positive territory, led by property that gained 26.03 points to 2,073.88. Financials rose 15.02 points to 1,370.60, while industrial advanced 78.48 points to 8,138.57.

Holding firms climbed 31.74 points to 4,492.12, while services edged higher 9.34 points to 1,799.85.

Mining and oil, however, ignored the market’s uptick and closed lower, plunging 489.13 points to 19,838.99.

Market breadth was positive with advancers outnumbering decliners 86 to 72, while 55 stocks were unchanged.

Asian stocks were also helped by speculation that China’s central bank will act soon to help the world’s No. 2 economy.

Hong Kong’s Hang Seng Index rose 78.09 points to 20,840.40. South Korea’s Kospi added nearly 0.2 percent to 1,992.12 and Australia’s S&P/ASX 200 gained 0.2 percent to 4,394.10. Benchmarks in Singapore, Taiwan, mainland China and Thailand   also rose.

But Japan’s Nikkei 225 index lost 79.71 points to 8,870.16, sinking on a government report that showed industrial production fell a further 1.3 percent in August. Weak global and domestic demand is weighing on manufacturers, particularly electronics makers, who are facing intense competition from South Korean, Taiwanese and other Asian manufacturers.

Spain’s budget announcement propelled Wall Street stocks to their first gain of the week, despite mixed data on the US economy. – AP