They said that after a storm, the rainbow and the sun will always come out. The same was true with what happened to our local bourse this trading week after typhoon Egay strongly hit the country. The index soared to almost 10 percent on the first trading day of the week after a long turbulent weekend, closing at 3,167.52 points, the largest single day gain in almost seven (7) years, buoyed by investors finding their comfort zones in Ben Bernanke’s (United States Federal Reserve Chairman) moves in injecting more funds, a hefty .5 billion, right into the veins of Uncle Sam’s banking system, to allay investors’ fears of a credit crunch. A total of .5 billion was already pumped into the system since August 9. In addition, Mr. Bernanke surprised investors and market players with a 50 basis point cut in its discount rate the previous week; a discount rate cut to 5.75 percent from 6.25 percent, while maintaining its key federal funds rate at 5.25 percent since June 2006.

In view of this, the local main market gauge made a rebound which spurred foreign and local buying in blue chips like Philippine Long Distance Telephone Company (PLDT) and San Miguel (SM). Local investors and market players were juxtaposing with what was happening in global markets.

PLDT, telecomminications Goliath, edged P225 to P2,520 earlier during the week and closed at P2,540 yesterday. .

Similarly, San Miguel A and B (SMC and SMCB) shares advanced P2.50 to P61.50 and P3.50 to P63.50 respectively earlier during the week. SMC and SMCB shares closed in the black yesterday, at P62.50 and P64 respectively.

As the week progressed, there was no stopping the local bourse as it continued to head north anchored on Wall Street’s gains on the back of a rise in the borrowing levels of banks. In addition, the news that the local central monetary financial institution might keep its finger on the same key interest rates, bolstered investors’ confidence.