Stocks fell for a second day, ahead of the release of fourth-quarter economic growth data and on concerns US President Donald Trump’s protectionist policy will affect the business process outsourcing sector.
The Philippine Stock Exchange index, the 30-company benchmark, dropped 47 points, or 0.6 percent, to close at 7,323.36 Wednesday. This trimmed total gains this year to 7.1 percent.
The heavier index, representing all shares, also shed 20 points, or 0.5 percent, to settle at 4,406.73, on a value turnover of P5.5 billion. Advancers outnumbered losers, 106 to 79, while 52 issues were unchanged.
Five of the six sectoral indices declined, while only five of the 20 most active stocks ended in the green, led by restaurant chain operator Shakey’s Pizza Asia Ventures Inc. which climbed 1.9 percent to P12.60 and LT Group Inc., the holding company of tycoon Lucio Tan, which rose 1.1 percent to P12.40.
Meanwhile, Asian markets pushed higher Wednesday, tracking a record close on Wall Street as investor concerns about Donald Trump’s lack of domestic policies were eased, while the dollar held gains against the yen.
After a slack start to the year for global markets, US traders took up the reins Tuesday to press back on with the November-December Trump rally after the tycoon gave the green light to two big oil pipeline deals.
The new president signed off on the controversial Keystone XL pipeline—which would carry oil from Canadian tar sands to US Gulf Coast refineries—and another crossing in North Dakota.
The move reverses decisions taken recently by Barack Obama and is the latest effort to wipe out the former president’s legacy.
Also Tuesday it emerged that House Speaker Paul Ryan signalled support for public works spending, while reports surfaced that Senate Democrats will unveil a $1 trillion infrastructure plan, offering the president their support if he backs it.
The developments soothed anxiety on markets that promised economy-firing spending and tax-cutting measures were being put on the back burner by Trump in favour of reviewing global trade deals.
“The fact that the US economy is strong is positive for the global economy, and right at this moment, investor sentiment is tipped toward hope that President Trump is trying something new,” said Chihiro Ohta, a Tokyo-based senior strategist at SMBC Nikko Securities.
On Wall Street the S&P 500 and Nasdaq ended at all-time highs, while the Dow got within spitting distance of breaking the 20,000-point barrier for the first time.
In Asia on Wednesday Hong Kong rose 0.3 percent in the afternoon, Shanghai ended up 0.2 percent, Sydney added 0.4 percent and Seoul was 0.1 percent higher, while Mumbai gained one percent.
There were also gains in Wellington, Kuala Lumpur and Jakarta.
Tokyo finished 1.4 percent higher as exporters were supported by a weaker yen.
The dollar flirted with 114 yen late Tuesday before paring the gains but it remains well up from the levels below 113 touched earlier in the day as dealers cheered the events in the US.
However the greenback is down about four percent from its highs seen at the end of last month.
And former top Japan currency official Eisuke Sakakibara warned in a Bloomberg News interview the US unit could fall towards 100 yen by the end of 2017 as Trump’s promise of four percent economic growth falls flat.
“Four percent US economic growth is impossible. In all likelihood it’ll remain around two percent or 2.5 percent, and that’ll be the end of Trump fever,” warned Sakakibara, who was dubbed Mr Yen for his influence of exchange rates in the 1990s.
In other forex trade the Canadian dollar rallied more than one percent against the greenback following Trump’s oil pipeline decision.
The move also weighed on oil prices in early Asian trade on fears it will add to a global glut of crude, despite the OPEC exporting cartel’s agreement in November to cut output. With Bloomberg, AFP
