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Market retreats; ICTSI, PNB slip

The stock market fell Monday in mixed trading, as most investors paused ahead of the State of the Nation Address of President Rodrigo Duterte later in the day.

The Philippine Stock Exchange Index dropped 23.24 points, 0.3 percent, to 8,246.83 on a value turnover of nearly P6 billion. Losers beat gainers, 103 to 80, with 61 issues unchanged.

International Container Terminal Services Inc., the biggest port operator, declined 2.8 percent to P137.70, while Nickel Asia Corp., the largest nickel producer, lost 4.8 percent to P2.57.

Philippine National Bank, the fifth-largest lender in terms of assets, fell 2.1 percent to P50.95, while SM Prime Holdings Inc. of the Sy Group, declined 2.1 percent to P37.90.

The rest of Asian markets were in retreat Monday on dimming hopes for a deep interest rate cut by the Federal Reserve, but all the firms on a new tech-focused board in China rallied on its opening day.

Oil prices extended last week’s gains after  Iran seized a British tanker in the Gulf, fueling fresh concerns about supplies and a possible conflict in the tinderbox Middle East.

Traders took a step back after last week’s gains as the New York Federal Reserve tempered comments from its president, John Williams, who had suggested the central bank would cut borrowing costs by 50 basis points at its policy meeting this month.

“Stocks are on the back foot as the market pares expectations for how deep the Fed will cut rates,” said Neil Wilson, chief market analyst at  Markets.com.

“Expectations for a 50 (point) cut are diminished and the market is now looking to the European Central Bank this week to see how dovish they go.”

Bets that the Fed will only reduce rates by 25 points provided support to the dollar against most high-yielding, riskier currencies.

On equity markets, Tokyo ended 0.2 percent lower and Hong Kong was off 1.4 percent.

Shanghai fell 1.3 percent, with liquidity hit as Chinese investors piled their cash into companies listed on the country’s new Nasdaq-style board.

Twenty-five stocks debuted on the Shanghai Stock Exchange’s Sci-Tech Innovation Board—dubbed the STAR Market—in which listing and trading rules have been eased to help channel funding to start-ups.

Anji Microelectronics Technology (Shanghai) Co. was one of the stand-out performers, soaring more than 500 percent at one point before paring gains to end up 400 percent.

There will be no limits on price movements for the first five days of trading, after which a daily 20 percent band is imposed. China’s main exchanges are subject to a 10 percent band to contain volatility.

Sydney, Seoul, Singapore and Jakarta were also lower, though Wellington and Taipei edged up.

There was some upbeat news for investors as China’s  Xinhua news agency said importers had started an arrangement to buy US agricultural goods, a week after President Donald Trump warned he could impose more tariffs if Beijing did not move quickly enough on the trade talks. With AFP

Topics: Rodrigo Duterte , State of the Nation Address , ICTSI , Philippine Stock Exchange Index
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