Sept. 30 (Bloomberg) -- Philippine stocks advanced, with the benchmark index bound for the biggest gain in Asia, after the government said economic growth will accelerate and the central bank said it has “flexibility” to support expansion.
Banco de Oro Unibank Inc., the nation’s biggest bank by assets, climbed to a seven-week high after raising money to boost capital. DMCI Holdings Inc., the country’s biggest construction company, led gains in infrastructure-related stocks after government said it will provide 22.5 billion pesos ($513 million) in funding for infrastructure projects.
The Philippine Stock Exchange Index rose for a third day, jumping 3.2 percent to 3,999.65 at the noon close in Manila. The measure lost 6.8 percent this quarter, the worst since the three months ended December 2008. The MSCI Asia Pacific Index dropped 0.9 percent as of 12:24 p.m. Singapore time.
“The government’s pronouncement is a good reminder there’s no fundamental problem with the Philippines,” said Jonathan Ravelas, chief market strategist at Manila-based Banco de Oro Unibank.
The Philippine stock measure sank to 3,721.22 on Sept. 26, the lowest close since Sept. 2, 2010, following a five-day sell- off triggered by speculation Greece’s debt problem will spread and slow the global economy.
Second-half growth in the Philippines will accelerate from the first six months of 2011, Economic Planning Secretary Cayetano Paderanga said today in a briefing to investors. Central bank Governor Amando Tetangco said the nation’s monetary policy is “flexible” and will support growth, while keeping inflation within the target of 3 percent to 5 percent.
Inflation in the $200 billion economy cooled to 4.7 percent in August, the slowest pace in four months, government data show.
Banco de Oro increased 4.3 percent to 51 pesos, the biggest gain since Aug. 10. The bank said it sold 6.5 billion pesos of so-called lower tier-2 bonds, more than double its original 3 billion-peso target.
DMCI advanced 1.2 percent to 34.70 pesos. The government infrastructure fund will be “on top of” money allocated for 10 projects earlier this year, Budget Secretary Butch Abad said yesterday.
--Editors: Matthew Oakley, Richard Frost
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