The main composite index of the Philippine Stock Exchange bounced back Tuesday from Monday’s profit-taking on positive economic data and forecasts.
The 30-company index rallied by 107.67 points, or 1.48 percent, to close at 7,380.32, while the broader all-shares index gained 44.68 points, or 1.14 percent, to finish at 3,963.36.
“The spillovers from Wall Street amid the rate cues from Fed chair Jerome Powell helped the market in its rise,” Philstocks Financial Inc. research head Japhet Tantiangco said. “Expectations that inflation last September has further slowed down also contributed to today’s rally.”
The market recovered most of previous day’s technical correction as investors welcomed the latest Philippine manufacturing data, which improved to two-year highs.
Value turnover reached P6.04 billion, above the year-to-date average of P5.9 billion. Foreign investors were net buyers, with net inflows reaching P463.82 million.
All indices ended in the green, led by property which climbed 2.36 percent and holding firms which rose 1.75 percent. Advancers edged decliners, 124 to 73.
Globe Telecom was the top index gainer, rising by 5.54 percent to P2,400, while Wilcon Depot Inc. was at the bottom, declining by 1.09 percent to P18.10.
Meanwhile, Chinese stocks surged on Monday after officials unveiled further economic stimulus measures, while Wall Street indices concluded a buoyant quarter with new records.
But a profit-warning from auto giant Stellantis and from Britain’s Aston Martin sent shivers through the industry, adding to the temptation to lock in gains on the final trading session of the third quarter.
Shanghai’s stock market jumped more than eight percent—its best day since 2008—while Hong Kong briefly leapt around four percent, a day before Chinese markets shut for the Golden Week holiday.
They extended a rally that began last week as Chinese officials announced fiscal measures, notably interest-rate cuts and relaxed rules on buying homes, aimed at igniting growth in the world’s second-biggest economy.
Developers were among the best performers in Hong Kong, with Kaisa rocketing more than 80 percent, Sunac jumping over 55 percent and Agile Group up 19 percent.
“The Chinese stock market rally will take a breather during the October holiday, which will give investors time to take stock and to decide whether the Asian powerhouse’s shares have further to run,” said Kathleen Brooks, research director at XTB.
But elsewhere in Asia, Tokyo stocks dropped nearly five percent on expectations that incoming prime minister Shigeru Ishiba would pursue policies keeping the yen strong — which would weigh on Japanese exporters.
Europe also had a difficult day as worries about the health of the car industry bruised sentiment.
In Paris, Stellantis — whose brands include Jeep, Fiat and Peugeot — saw its shares plummet 14.7 percent after slashing its operating margin target, citing costs for improving its North America operations and increased Chinese competition.
Britain’s Aston Martin also lowered its financial guidance for 2024, sending its shares down 23 percent.
US stocks were also under pressure much of the day, with US auto giants General Motors and Ford also falling decisively.
But New York enjoyed a late-session rally that propelled the market back into positive territory.
The broad-based S&P 500 finished at 5,762.45, an all-time high, up 0.4 percent for the day and up about 5.5 percent for the quarter.
The Dow also edged to a fresh record, the latest in recent weeks amid expectations for more Federal Reserve easing in the coming months.
“This has been a great quarter,” said Steve Sosnick at Interactive Brokers. “It’s hard to find losers this quarter.”
This week’s data includes the September jobs report, which will affect the Fed’s monetary policy moves.
On Monday, Fed Chair Jerome Powell signaled that interest rates are likely to come down more.
“Disinflation has been broad-based, and recent data indicate further progress toward a sustained return to two percent,” Powell said at the National Association for Business Economics annual meeting in Tennessee.
“Broader economic conditions also set the table for further disinflation,” the Fed chair added. With AFP
