Market ends flat; Jollibee retreats

The stock market closed flat Monday in thin trading, unable to join the rally in the region as investors remained cautious of the next move of the Bangko Sentral ng Pilipinas.

The Philippine Stock Exchange Index fell minimally by 0.09 point to 7,186.62 on a value turnover of P3.4 billion. Losers beat gainers, 105 to 81, with 49 issues unchanged.

Metropolitan Bank & Trust Co., the second-biggest lender in terms of assets, declined 2.7 percent to P67.85, while Jollibee Foods Corp., the largest fast food chain, lost 2.4 percent to P245.

Now Corp. of the Velarde Group, which is bidding to become the third major telecommunications company, tumbled 3.9 percent to P9.28, but Bank of the Philippine Islands, the third-biggest bank, rose 1.7 percent to P89.

The rest of Asian markets rallied on Monday, extending their gains at the end of last week, following another strong US jobs report that reinforced confidence in the US economy and helped settle trade war nerves.

While Friday’s tit-for-tat tariffs on billions of dollars of goods by the world’s top two economies were seen as damaging, analysts said the impact would be limited.

Global markets had been tumbling ahead of the imposition of the tariffs but bounced on Friday.

The upbeat sentiment carried over into the new week after data showed the US economy created more than 200,000 jobs in June, beating expectations.

That was compounded by the fact that average hourly earnings growth remained sluggish, while the unemployment rate edged up, easing pressure on the Federal Reserve to lift interest rates.

The result helped all three main indexes on Wall Street to end on a high.

And in Asia on Monday Tokyo finished 1.2 percent higher, while Shanghai surged 2.5 percent and Hong Kong added 1.7 percent in the afternoon.

Sydney rose 0.2 percent, Singapore climbed 1.3 percent, Seoul added 0.6 percent and Taipei was more than one percent higher.

However, concerns remain that the trade row between China and the US could intensify, with Donald Trump threatening hundreds of billions of dollars more in Chinese goods.

Stephen Innes, head of Asia-Pacific trading at OANDA, said that “should the (Trump) administration follow through with the threat of a $200 billion-plus duties on Chinese goods, this would have some negative implication for both the US and global growth prospects.”

Eyes are now on the release of Chinese trade data later this week.

On currency markets the Chinese yuan edged up against the dollar, having tumbled in recent weeks on the trade spat.

While there had been speculation among some observers that Beijing would allow the unit to weaken in order to offset the impact of a trade war, authorities stressed they would not weaponize it.

The pound managed to eke out some gains as Fed rate hike expectations ease and despite Westminster upheaval after Prime Minister Theresa May’s point man on Brexit negotiations resigned over the government’s plan to retain strong economic ties with the EU even after leaving. With AFP

Topics: stock market , Bangko Sentral ng Pilipinas , Philippine Stock Exchange Index , Metropolitan Bank & Trust Co. , Jollibee Foods Corp.
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