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Tuesday, July 23, 2024

Market surges again; BDO jumps

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The stock market soared again Thursday along with the rest of Asia, as investors breathed a sigh of relief that US senators have finally passed a gargantuan stimulus package for the world’s top economy after being delayed by wrangling over details.

The Philippine Stock Exchange Index jumped 373.82 points, or 7.4 percent, to 5,401.58 on a value turnover of P7.7 billion. Gainers overwhelmed losers, 151 to 48, with 26 issues unchanged.

BDO Unibank Inc. of the Sy Group, the biggest lender in terms of assets, advanced 15.7 percent to P115.70, while sister unit SM Prime Holdings Inc. climbed 14.8 percent to P31.

Metro Pacific Investments Corp., which is into toll roads, water and electricity distribution, hospitals and infrastructure, rose 10.2 percent to P2.71, while PLDT Inc., the largest telecommunications firm, surged 9.8 percent to P1,066.

The rest of Asian markets rose. The unprecedented $2 trillion plan—described by Senate Majority Leader Mitch McConnell as a “wartime level of investment”—helped spur a surge across global equities as panicked traders worried about the impact of the coronavirus sweeping the planet.

But another advance on Wall Street was blunted Wednesday as it emerged that four Republican senators have balked at the generous provisions agreed to in the bipartisan deal with the White House.

The bill eventually cleared the Senate by an overwhelming majority and will now head to the House of Representatives before going to President Donald Trump for his signature.

The monster deal thrashed out between Republicans, Democrats and the White House includes cash payments to American taxpayers and several hundred billion dollars in grants and loans to small businesses and core industries. It also buttresses hospitals desperately in need of medical equipment and expands unemployment benefits.

The plan, together with a huge bond-buying program by the Federal Reserve that effectively prints cash, is part of an unprecedented global response to the outbreak, which has even seen Germany put together a list of measures worth more than $1 trillion.

Asian markets mostly rose though major indexes struggled after posting hefty gains this week.

Tokyo ended down 4.5 percent after surging almost a fifth over the previous three days, while Hong Kong dipped 0.3 percent and Shanghai eased 0.2 percent.

But Sydney jumped more than two percent, Wellington and Mumbai climbed four percent and Jakarta soared almost 10 percent.

There were also healthy gains in Taipei and Bangkok.

Singapore also bounced back into positive territory, having earlier lost more than two percent. Data in the morning showed the city-state’s economy suffered its worst quarterly contraction since the financial crisis more than a decade ago, giving global investors an early insight into the economic effects of the pandemic.

Singapore is considered a bellwether for trade-reliant Asian countries.

While the US bill provides much-needed support, observers continue to err towards caution with most now expecting the global economy to plunge into recession as countries go into lockdown, turning off the growth taps. With AFP


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