Stocks rose Thursday after the World Bank said the Philippines would likely grow 6.4 percent this year despite its prediction of sluggish global economic expansion.
The Philippine Stock Exchange index, the 30-company benchmark, rose 14 points, or 0.2 percent, to close at 7,959.86, as four of the six major sub-sectors advanced. The bellwether was also up 6.6 percent since the start of the year.
The broader all-share index gained 1 point to settle at 4,884.87, on a value turnover of P7.3 billion. Gainers matched losers at 98 apiece, while 49 issues were unchanged.
Eleven of the 20 most active stocks ended in the green, led by Phinma Energy Corp. which climbed 2.8 percent to P2.54 and First Gen Corp. which advanced 2.1 percent to P24.
Meanwhile, Asian stocks reversed early gains Thursday as trade tensions continued to weigh on investors’ minds, with some cautiously hoping that the United States and Mexico will strike a compromise on tariffs.
US President Donald Trump said some progress—but not enough—had been made in Wednesday’s talks with Mexico on averting the tariffs he intends to impose next week unless the flow of undocumented migrants into the US is stopped.
Trump tweeted that discussions would resume Thursday.
Coming on the heels of the US-China trade war, Trump’s threats against Mexico have intensified fears for the global economy, hurting oil prices and lowering overall growth forecasts.
A World Bank report released Tuesday showed reduced global growth forecasts for the year, with the economy expected to expand by 2.6 percent, well below the three percent increase seen in 2018.
Crude prices made a tepid recovery Thursday, following the previous day’s decline after data from the US Department of Energy showed domestic production rising, and Morgan Stanley on Wednesday slashed its oil price forecast, citing a “sharper-than-expected slowdown in demand”.
“Oil prices remain under pressure, dragged down by an unexpected gain in US inventories and comments from the head of Russian state oil producer Rosneft questioning the point of a deal with Opec to withhold supplies,” said Dean Popplewell, vice president of market analysis at Oanda.
But Oanda senior market analyst Edward Moya said oil markets “could see strong bullish momentum return if we see a softer US dollar, trade progress from the G20 Summit, prompting the alleviation of demand fears, geopolitical risks will keep supplies tight and rising summer demand”.
Hong Kong and Tokyo were flat while Shanghai dropped 1.2 percent. But Seoul eked out modest gains of 0.1 percent.
There are hopes that Trump and Chinese President Xi Jinping will meet at the G20 summit in Japan this month to jump-start stalled tariff negotiations.
Investors are also looking ahead to Thursday’s gathering of the European Central Bank, hoping for fresh measures to tackle rising worries about growth and inflation in the eurozone.
European markets edged up in early trade, with London climbing 0.4 percent and Paris gaining 0.1 percent. Frankfurt was flat.
Comments by Fed Chairman Jerome Powell on Tuesday acknowledging trade tensions and signaling that the central bank was willing to act if necessary helped investors overlook a weak report on US private-sector hiring.
The more closely watched US Labor Department report will be released on Friday.
Central banks around the world are adopting a more dovish tone on monetary policy, with the Reserve Bank of India cutting interest rates on Thursday in a boost to newly re-elected Prime Minister Narendra Modi, who is grappling with a sluggish economy and decades-high unemployment. With AFP