Market declines on profit taking

The stock market fell Monday on profit-taking led by select blue chips, ahead of the Lunar New Year holiday today and the release of the inflation rate for January.  

The Philippine Stock Exchange Index dropped 74.68 points, or 0.9 percent, to 8,069.48 on a value turnover of P7.3 billion. Gainers, however, beat losers, 124 to 83, with 47 issues unchanged.

Premiere Horizon Alliance Corp., a speculative holding company with interests in mining and property development, sank 17.9 percent to P1.33, while Globe Telecom Inc., the second-biggest telecommunications firm, lost 1.9 percent to P2,030.

SM Investments Corp. of the Sy Group slipped 1.8 percent to P997, but Zeus Holdings Inc., a speculative mining company, jumped 36.2 percent to P0.47. 

Asia’s major markets, meanwhile, mostly rose Monday as investors were cheered by a blockbuster US jobs report last week, while trade was thin owing to the three-day Lunar New Year break.

Expectations that the Federal Reserve will take its foot off the gas in raising interest rates and optimism that China and the United States will eventually hammer out a deal to resolve their long-running trade war were also providing support.

With most of the region closed this week for an extended holiday there are few catalysts to drive business, though dealers took heart from Friday’s strong US non-farm payrolls numbers.

The world’s biggest economy added 304,000 new posts in January, almost double what was expected and the strongest reading for almost a year, while growth in pay held steady above inflation.

All three main indexes on Wall Street ended with gains and that filtered through to Asia.

Hong Kong ended 0.2 percent higher and Tokyo climbed 0.5 percent, with Sony plunging more than eight percent after lowering its annual sales forecast on Friday and flagging weak profits in its PlayStation business.

Sydney also rose 0.5 percent though Singapore dipped 0.1 percent.

Bangkok edged up but there were losses in Jakarta, Wellington, and Mumbai.

Shanghai, Seoul, Taipei and several other markets were closed for the holidays.

Peter Wilmshurst, a portfolio manager at Templeton Global Equities in Melbourne, said 2019 could see a recovery in equities.

“If we see some sort of inflection in economic growth stabilizing, then people can have more confidence in earnings,” he told Bloomberg TV.

The plunge in prices last year “leaves the valuations of many stocks around the world looking pretty interesting to us, particularly outside the US.”

On currency markets the dollar rose, though observers pointed out that the rally in the greenback from the jobs data was limited as dealers focus on the Fed’s slower pace of rate hikes.

The Nikkei 225 index closed up 0.46 percent, or 95.38 points, at 20,883.77, while the broader Topix index advanced 1.07 percent, or 16.70 points, to end at 1,581.33.

That was despite a plunge in the stock of electronics giant Sony, which dropped more than eight percent after lowering its annual sales forecast.

Investors are closely watching earnings reports due this week, including SoftBank Corp. on Tuesday and SoftBank Group and Toyota on Wednesday, analysts said. With AFP

Topics: Premiere Horizon Alliance Corp. , Globe Telecom Inc. , SM Investments Corp.
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