Market extends rally; BDO climbs
The stock market Thursday extended its rally, as investors tracked another strong lead from Wall Street, with fresh upbeat US data reinforcing optimism in the global outlook, overshadowing simmering trade concerns.
The Philippine Stock Exchange Index surged 114.17 points, or 1.5 percent, to 7,803.31 on a value turnover of P6.9 billion. Gainers beat losers, 119 to 77, with 45 issues unchanged.
BDO Unibank Inc., the biggest lender in terms of assets, advanced 4.8 percent to P137, while DMCI Holdings Inc. of the Consunji Group, climbed 5 percent to P11.38.
Universal Robina Corp., the largest snack food maker, gained 3.5 percent to P129.90, while Metropolitan Bank & Trust Co., the third-biggest bank, rose 3.1 percent to P82.55.
The rest of Asian markets also built on their latest rally Thursday. The euro also continued its recovery from last week’s Italy-fueled plunge, with the European Central Bank’s top economist saying it would discuss winding down its crisis-era stimulus.
All three main indexes in New York rose, with the Nasdaq hitting a third straight record, after a record reading on US exports for April, which indicated the world’s top economy is in fine fettle.
Banks were among the big winners as the ECB’s massive bond-buying regime, which has kept borrowing costs low, appears to be coming to an end after chief economist Peter Praet said such a move would be on the agenda at next week’s policy meeting.
The euro—which dallied with $1.15 last week—briefly climbed past $1.18 on Wednesday before easing back, but it held up in Asia.
In equity markets, Tokyo ended 0.9 percent higher, while Hong Kong rose 0.8 percent–a sixth successive gain.
Sydney was 0.8 percent higher and Seoul put on 0.7 percent. Taipei, Wellington, and Jakarta were also higher. However, Shanghai ended down 0.2 percent following an afternoon sell-off and Singapore was marginally lower.
“While interest rates are usually a negative for equity markets, investors are viewing higher interest rates in a favorable light, reflective of surging economic growth, not as a buffer against inflation,” said Stephen Innes, head of Asia-Pacific trade at OANDA.
The positive mood comes as traders await this weekend’s Group of Seven summit in Quebec, which comes after Donald Trump sparked fury by imposing steel and aluminum tariffs on Canada, Mexico, and the European Union.
That was met with retaliatory measures from all three.
Canadian Prime Minister Justin Trudeau and German Chancellor Angela Merkel have said they are braced for tense discussions, while Japanese Finance Minister Taro Aso has referred to the G7 as the “G6+1,” highlighting the growing divisions.
“Reports are that not only is... Trump going to continue to pursue his hard line on trade but also that... Trudeau has raised the ire of the White House with his response to US tariffs and more are on the way,” said Greg McKenna, chief market strategist at AxiTrader.