Stocks jump 9.8 percent on US Federal rate action

MANILA (AP) - Philippine shares surged Tuesday to their biggest single-day rise in more than six years, with the U.S. Federal Reserve discount rate cut from last Friday driving bargain hunters, traders said.

The 30-company Philippine Stock Exchange Index rose 283.18 points, or 9.8 percent from Friday's close, to 3,167.52, its biggest gain since rising 17.6 percent Jan. 22, 2001 _ the first trading day after President Joseph Estrada was ousted on corruption allegations.

Friday, the index fell 2 percent to 2,884.34, ending a week that saw the market lose all its gains for the year.

As Asian markets rebounded Monday after the Federal Reserve cut its emergency discount rate by 50 basis points at the end of last week, investors in Manila were held at bay because of a holiday.

"We're just playing catch up," said Francisco Liboro, president of PCCI Securities Brokers. "Foreign buying was primarily on blue chips. Even there, you see a flight to quality."

Gainers beat decliners 135-8, with 13 issues unchanged. Leading the advancers were blue chips Bank of the Philippine Islands, Ayala Land and Philippine Long Distance Telephone.

BPI rose 11 percent to 59.50 pesos, Ayala Land 5.7 percent to 14 pesos, and PLDT 9.8 percent to 2,520 pesos.

Jose Vistan, research head at AB Capital Securities, said the Federal Reserve's action provided a calming effect to the market. But he expects the market's sharp rise to open a window for still-jittery investors to take profit in coming days.