Stocks rose slightly Thursday to end a three-day slump, on market consolidation and following overnight gains on Wall Street where the Dow smashed through 22,000 for the first time.
The Philippine Stock Exchange index, the 30-company benchmark, gained 4 points, or 0.1 percent, to close at 7,876.66
The heavier index, representing all shares, also picked up 6 points, or 0.1 percent, to settle at 4,714.57, on a value turnover of P5.7 billion. Losers outnumbered gainers, 114 to 83, while 54 issues were unchanged.
Nine of the 20 most active stocks ended in the green, led by developers DoubleDragon Properties Corp. which jumped 8.4 percent to P48.85 and Global-Estate Resorts Inc. which climbed 4.4 percent to P1.65. Manila Electric Co., the country’s largest power retailer, advanced 2.2 percent to P279.60.
Meanwhile, strong Apple earnings propelled the Dow above the barrier to mark its sixth straight record close—but the tech-heavy Nasdaq closed marginally lower.
Trading screens across Asia were a sea of red, with Tokyo halting a two-day rally to close 0.3 percent lower, as several tech companies fell following drops in their US peers.
Profit-taking also hit many of Apple’s Japanese suppliers which had risen the previous day on the US iPhone maker’s better-than-expected results.
Hong Kong shares ended a strong rally that had seen prices record the biggest monthly advance in July since January, while Shanghai moved further off its 2017 high achieved Tuesday.
Analysts said despite euphoria over the Dow’s fresh record, investors were still watching the US Federal Reserve’s plan to unload its balance sheet following its vast quantitative easing program.
“Everyone is talking about the record close last night,” said Greg McKenna, chief market strategist AxiTrader.
“But despite that, we received some further guidance from a number of Fed speakers overnight about a solid agreement that the balance sheet reduction will happen soon.”
McKenna warned: “If the growth in the balance sheet had stimulatory effects on the economy—and clearly stocks—then why [wouldn’t] the reduction in balance sheet size… act as a de facto tightening.”
US stocks have risen to new highs as second-quarter earnings have broadly exceeded expectations, even as the greenback has come under sustained pressure from political uncertainty in Washington with the Trump administration mired in controversy.
The dollar has been losing ground against the euro, which moved above $1.19 Wednesday for the first time since January 2015 before retreating to trade at 1.1846 in Tokyo Thursday. The dollar was also up from lows of 110.26 yen earlier this week at 110.66.
But a trigger for further losses in the greenback could come as soon as Friday if the US jobs report for July disappoints and is seen lessening the odds of additional Fed rate hikes.
The non-farm payrolls data is “shaping up to be a majorly significant event,” said Stephen Innes, who heads Asia-Pacific trade at forex firm Oanda.
“With summer setting in and holiday liquidity upon us, Friday’s jobs report could be the last hurrah before what is shaping up to be a very interesting September for Fed watchers,” he said.
Investors were also digesting a report the US is planning to take trade measures against China to force it to crack down on theft of intellectual property, a move that could disrupt ties between the world’s top two economies. With Bloomberg, AFP