The stock market closed flat Wednesday in mixed trading, with many investors consolidating their position amid the war in Ukraine.
The Philippine Stock Exchange Index added just less than a point to 7,009.43 on a value turnover of P5.9 billion. Gainers edged losers, 91 to 85, with 48 issues unchanged.
Fiber broadband provider Converge ICT Solutions Inc. climbed 5.9 percent to P26.80, while Universal Robina Corp., the biggest snack food maker, advanced 3.5 percent to P111.90.
PLDT Inc., the biggest telecommunications firm, rose 3.1 percent to P1,785, but International Container Terminal Services Inc., the largest port operator and owned by tycoon Enrique Razon Jr., dropped 3.2 percent to P220.40.
The rest of Asian markets extended gains Wednesday, tracking a rally in New York, on optimism that the Federal Reserve’s plan to hike interest rates will help bring inflation under control.
While there remains plenty of concern about the war in Ukraine, analysts said some confidence had seeped back into trading floors as investors bet on consumer resilience and economies continue to reopen.
Fed boss Jerome Powell said Monday that the central bank was prepared to act more aggressively on lifting borrowing costs if inflation—already at a 40-year high—does not fall quickly enough.
Officials lifted rates last week by a quarter of a point but some have advocated hikes of half a point, a view Powell suggested he was open to, adding that he was happy the economy was strong enough to withstand such a move.
While the faster and steeper rate of hikes would make it costlier for investors to borrow, commentators said the Fed’s stance gave them confidence it could get a grip on prices.
“We are positive for equities for this year,” Seema Shah, of Principal Global Investors, told Bloomberg Television.
She added that while the near-term outlook would be challenging with recession risks rising, “we still think the US economy is pretty good fundamentally.”
“Faster hikes are clearly going to help inflation come down,” which may reduce the need for a longer tightening campaign.
All three main indexes on Wall Street rallied Tuesday, with the Nasdaq piling on two percent.
And Asia took up the baton, with Tokyo jumping three percent and Hong Kong continuing to bask in a tech rally fueled by China’s pledge of support for markets, putting on more than one percent.
Shanghai, Seoul, Sydney, Singapore, Taipei and Bangkok were also on the front foot, though Mumbai, Jakarta and Wellington dipped.
“The market appears to be unfazed by the risks that have haunted it for the first quarter and appear ready to grind higher with conviction,” said market strategist Louis Navellier.
“It appears that the long-awaited reopening trade has finally begun in earnest, despite the baggage of Ukraine and surprisingly high inflation, and may soon draw in a lot of money off the sidelines.”
Still, investors continue to keep an eye on developments in the Ukraine war, which is keeping oil prices elevated though they remain stuck just below $120 a barrel. With AFP
