Stocks closed virtually unchanged Wednesday, with investors wary over proposals to suspend the excise tax on fuel that could set back economic recovery from the pandemic.
The Philippine Stock Exchange Index added 6.53 points, or 0.09 percent, to 7,026.45 on a value turnover of P7.8 billion. Gainers outnumbered losers, 119 to 59, with 55 issues unchanged.
Finance Secretary Carlos Dominguez III has rejected proposals to suspend the excise tax on fuel to reduce the impact of higher oil prices on consumers, saying they will only end up subsidizing the expenses of affluent families more than those of low-income households.
Fiber broadband provider Converge ICT Solutions Inc. rose 7.7 percent to P23.70, but SM Prime Holdings Inc. of the Sy Group fell 2.7 percent to P37.95.
Metropolitan Bank & Trust Co. of the Ty Group, the second-biggest lender in terms of assets, declined 1.4 percent to P52.25, while JG Summit Holdings Inc. of the Gokongwei Group slipped 1.3 percent to P58.
The rest of Asian equities rallied Wednesday after their recent rout, with Hong Kong leading the way after Chinese authorities pledged to provide support and stability to the country’s troubled markets.
Traders were piling back into regional stocks to snap up bargains in the wake of a sell-off fueled by concerns about the war in Ukraine, the US Federal Reserve’s plans to start hiking interest rates and COVID outbreaks in China that threaten its growth outlook.
Shanghai’s Composite Index joined in the rally, putting on more than three percent.
The rest of Asia also enjoyed a much-needed bright day. Tokyo, Sydney, Seoul, Singapore, Bangkok and Mumbai were all up more than one percent. Wellington, Taipei and Jakarta were also well up.
Hong Kong’s Hang Seng Index was at the forefront, with an eye-watering spike of more than nine percent that came after a report by the official Xinhua news agency saying China will keep the stock market stable and support overseas share listings.
The report, which cited a meeting chaired by Vice Premier Liu He, came after a series of pieces in state media looking to boost sentiment.
“China’s state economic policy apparatus is taking significant coordinated steps to support risk sentiment,” said Stephen Innes of SPI Asset Management.
“These include State Council support for overseas listings, engaging with the US on (New York-listed stocks), and perhaps most importantly, suggesting that regulation of its big tech firms will end soon.
“There are also promises to step-up support for the real estate sector. These announcements don’t mean much individually, but collectively, they suggest policymakers won’t sit idle, and that asset prices will be supported directly or indirectly.”
The news lit a fire under the HSI, where mainland Chinese tech firms had been reeling from a sell-off this year fueled by a government crackdown on the sector and fears about possible US sanctions if China were to help Russia in its war with Ukraine.
The decision to lock down the southern Chinese tech hub of Shenzhen to fight COVID-19 compounded the crisis for the sector. With AFP