Stocks declined Tuesday to end a three-day advance, despite yet another record close on Wall Street, as investors focused on upcoming US inflation data for fresh clues about the direction of the American economy.
The Philippine Stock Exchange index, the 30-company benchmark, dropped 5 points, or 0.1 percent, to close at 7,986.51, as three of the six major sectors declined.
The heavier index, representing all shares, also shed 18 points, or 0.4 percent, to settle at 4,734.64, on a value turnover of P8.6 billion. Losers outnumbered gainers, 138 to 60, while 51 issues were unchanged.
Nine of the 20 most active stocks ended in the green, led by Security Bank Corp. which climbed 3.6 percent to P243 and developer Ayala Land Inc. which rose 2.8 percent to P43. BDO Unibank Inc., the largest lender, gained 1.6 percent to P131, while PLDT Inc. picked up 1.1 percent to 1,658.
Meanwhile, the Dow Jones eked out a ninth straight all-time high Monday, as a strong second-quarter earnings season continued to attract more funds to US equities, while the tech-heavy Nasdaq also advanced.
But regional bourses paused for breath in light summer holiday trading after recording healthy gains Monday on strengthening faith in the health of the world economy spurred by a better-than-expected US jobs report for July.
In Tokyo, a stronger yen, which weighs on exporters’ profits, capped the Japanese market’s gains, as the greenback started to give up gains from Friday’s robust US jobs data.
The Nikkei was off 0.3 percent by the break, also dragged down by tech giant SoftBank slipping into negative territory, while Hong Kong was flat in morning trade and Shanghai was marginally lower as figures showed Chinese imports and export growth missed forecasts in July.
Analyst said recent rises in equities in the US and Asia had been driven by strong earnings.
“The message from corporate CEOs around the world was loud and clear,” said Chris Weston, chief market strategist at IG Markets.
“They are not concerned with Trump, geopolitics or trade restrictions, they see earnings growth as the main game in town and equity investors are aligned with this outlook.”
Market watchers are now eyeing whether the US blue-chip index can match the all-time run of gains seen in January 1987, Weston added.
However, Chinese trade growth slowed significantly in July compared to the previous month, official data showed Tuesday, coming in well below expectations after months of steady momentum.
“Overall exports and imports are still resilient,” Raymond Yeung, chief greater China economist at ANZ in Hong Kong, said in a Bloomberg Television interview.
Japan’s Topix index retreated from a two-year high, while stocks in Australia and South Korea also declined. European futures were lower in early trading along with US futures. The dollar fell and West Texas Intermediate crude sat below $50 a barrel.
Asian equities remain near the highest level in 10 years as the current earnings season supports the case for growth in the global economy being intact. Even the Chinese leadership’s strongest commitment yet to curb financial risks and rein in spendthrift local officials hasn’t worried global investors. Read more on that story here. With Bloomberg, AFP