Stock index surpasses 8,900 level
Stocks passed the 8,900-point level for the first time on record Tuesday, as the local market moved in line with a global rally that gave the Asia-Pacific region its best start since 2006.
The Philippine Stock Exchange index, the 30-company benchmark, jumped 178 points, or 2 percent, to close at 8,923.72, its biggest advance in 12 months. The bellwether was also up 4.3 percent since the start of the year, following a 25.1-percent gain in 2017.
The broader all-share index also climbed 72 points, or 1.4 percent, to settle at 5,138.63 Tuesday, also an all-time high, on a value turnover of P8.4 billion. Gainers outnumbered losers, 118 to 93, while 47 issues were unchanged.
Fifteen of the 20 most active stocks ended in the green, led by retailer Puregold Price Club Inc. which surged 7.2 percent to P53.95 and food manufacturer Universal Robina Corp. which advanced 5.4 percent to P174. BDO Unibank Inc., the largest lender, gained 5.3 percent to P164.60.
Meanwhile, Asian markets mostly rose Tuesday, with Hong Kong marking 11 straight wins and Tokyo at a 26-year high, as investors press on with a global rally that has the region enjoy its best start since 2006.
Wall Street provided yet another record lead as eyes turn to the beginning of the corporate earnings season, with sentiment buoyed by strong economic readings and hopes that Donald Trump’s tax cuts will help fire up profits.
“This environment of strong global growth and contained inflation is actually a great environment for Asian equities, including tech,” Ajay Kapur, head of Asia Pacific and global emerging market strategy at Bank of America Merrill Lynch in Hong Kong, told Bloomberg TV.
Hong Kong rose 0.2 percent, marking its best run of gains since October 2012, while Shanghai finished 0.1 percent higher. Tokyo closed up 0.6 percent–at its highest close since November 1991―as traders returned from a long weekend break.
Sydney rose 0.1 percent and Singapore climbed 0.4 percent.
There were also gains in Wellington and Kuala Lumpur but Wellington and Taipei slipped.
Seoul closed down 0.1 percent hit by a more than three percent drop in market heavyweight Samsung Electronics, which was hit after its forecast for record fourth-quarter profits missed expectations.
However, while markets continue to push ever higher, there are worries the advances this week could be petering out, and there are also warnings of a sharp correction on the horizon.
The dollar held on to its gains against the pound and euro, consolidating its recent mini-rebound with the single currency unable to make inroads despite data showing eurozone economic sentiment at its highest since 2000.
However, with Trump’s tax cuts already built in and the European Central Bank expected to begin winding down its stimulus, analysts say the greenback will likely face further pressure from the euro down the line.
On oil markets, both main contracts continued their positive start to the year as major producer Iran is hit by unrest and Venezuela’s economy remains depressed.
“Protest in Iran, and decreasing US crude inventories are providing a stable floor on WTI,” said Stephen Innes, head of Asia-Pacific trading at Oanda, said in a note.
He added that while a severe freeze in the northeast of the US would boost demand for heating oil, the temperatures were keeping drivers off the road.
However, he said: “With geopolitical risk extending from Tehran to Venezuela’s economic demise, the market remains on a bullish tack.” With AFP