(UPDATE) Stocks close higher on positive foreign market expectations

MANILA, Philippines (Xinhua) - The Philippine stock market rallied to the 7,400 level following the interest rates statement of US Federal Open Market Committee (FOMC).

The bellwether Philippine Stock Exchange index (PSEi) jumped by 0.48 percent or 35.09 points to 7,402.2, while the broader all- share index rose by 0.35 percent or 15.01 points to 4,336.90.

Trading volume reached 2.93 billion shares worth P11.20 billion ($248.64 million) with 99 stocks advancing, 91 declining, and 42 were unchanged.

Of the six counters, three fell. These were industrial, mining and oil as well as the property sectors.

"The PSEi recorded a modest gain on the first week of the 2015 after the US Federal Reserve cautioned against an interest rate hike," online brokerage AB Capital Securities, Inc. said in its weekly market comment.

The strong take up the newly issued 25-year USD-denominated bonds for cash, with a 3.95 percent coupon rate similarly helped to move the markets upwards as investors saw this as an indication of heightened confidence of the foreign investors in the country.

Another positive mover for this week was the news on the Philippines being the highest exports performer for the third time among East and Southeast Asian economies in November 2014. According to the National Economic and Development Authority, the performance of the exports sector was largely driven by the growth in manufactures, agro-based and mineral products.

On international news, the latest Federal Reserve hinted at a more dovish stance pushing the United States and international equity prices higher. According to the minutes released last Wednesday, the Federal Open Market Committee is unlikely to hike rates until April and that it can be patient in beginning the normalization process.

"The local bourse managed to set a new close above the critical resistance of 7,400 days after the Federal Reserve maintained its dovish stance on rates due to slowing inflation. The index was further pushed by plunging oil prices in the world - seen as positive given that we are a net importer of crude oil," AB Capital said.

Stocks in the 30-company index were mostly up. These include heavyweight Philippine Long Distance Telephone Co., Ayala Land, Inc., and Ayala Corp.