spot_img
28.6 C
Philippines
Friday, March 29, 2024

Stock market retreats; IMI, AGI lead advances

- Advertisement -

Stocks dropped Tuesday to end a five-day rally, as investors took profit from strong gains that pushed the benchmark index near the 8,300-point level Monday.

The Philippine Stock Exchange index, the 30-company bellwether, plummeted 131 points, or 1.6 percent, to close at 8,162.70, as all six major sectors declined.

The heavier index, representing all shares, also tumbled 58 points, or 1.2 percent, to settle at 4,828.21, on a value turnover of P8.9 billion.

Six of the 20 most active stocks ended in the green, led by semiconductor manufacturer Integrated Micro-Electronics Inc. which jumped 7.2 percent to P18.10 and conglomerate Alliance Global Group Inc. which climbed 1.9 percent to P15.04. Developer Robinsons Land Corp. rose 1.6 percent to P20.20.

Meanwhile, Japanese stocks soared when the market reopened Tuesday on a weak yen as the dollar was lifted by expected monetary tightening and renewed hopes for Donald Trump’s economic agenda, but most other Asian markets retreated after recent gains.

- Advertisement -

Equities had rallied Monday as investors turned their attention to macro issues, particularly a Federal Reserve policy meeting and Trump’s maiden speech to the UN General Assembly.

While the US central bank is not expected to raise interest rates this week, remarks from the Fed and its boss Janet Yellen will be pored over for clues about future moves—with talk of another rise—and its plans to wind down the vast bond-buying stimulus put in place during the financial crisis.

Analysts said that despite the expected tightening, investors were again optimistic that Trump can push through the market-friendly policies that helped drive a global rally at the start of the year.

“We are not overly concerned about [tighening]”, Merrill Lynch and US Trust head of fixed-income strategy Matthew Diczok told Bloomberg Television.

“If you model it out, over about the next three years they’ll take out about $1.3 trillion or so. That’s only a third of what they put into the market. So it’s going to be a very slow, very gradual, very deliberate and it shouldn’t lead to any near-term fireworks into the market at all.”

After the selling earlier this month fueled by North Korea’s nuclear test, traders returned to buying ways. On Monday global markets ended mostly up, with the S&P 500 and Dow on Wall Street each hitting fresh highs.

“The surge was yet another testament that the reinvigoration of the Trump trades is gaining traction,” Greg McKenna, chief market strategist at AxiTrader, said.

“Recent happenings have seen Trump’s leadership change and it is clear markets are seeing that,” he added.

Japanese dealers returned from a three-day weekend Tuesday and picked up the baton, sending the Nikkei two percent higher with exporters buoyed by the dollar’s push towards 112 yen. However, elsewhere in the region markets turned lower as traders cashed out.

Hong Kong was down 0.3 percent in the afternoon, Shanghai ended off 0.2 percent, Singapore lost 0.2 percent and Sydney dipped 0.1 percent. Seoul was off 0.1 percent, with Taipei 0.5 percent off and Manila 1.3 percent down.

In early trade London and Paris each dipped 0.1 percent, while Frankfurt was flat.

On forex markets talk of more stringent monetary policy supported the dollar, with the pound rowing back from levels above $1.36 after the head of the Bank of England indicated possible British rate rises could be slow and gradual. With AFP, Bloomberg

- Advertisement -

LATEST NEWS

Popular Articles