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Saturday, May 25, 2024

Market falls; Ayala issues climb

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The stock market fell Friday as traders fear another wave of lockdown measures abroad will throw an already shaky economic recovery off course.

The Philippine Stock Exchange Index shed 54.38 points, or 0.8 percent, to 6,969.88 on a value turnover of P10.8 billion. Gainers, however, beat losers, 119 to 85, with 54 issues unchanged.

Conglomerate Ayala Corp. dropped 3 percent to P844, while energy unit AC Energy Philippines Inc. declined 3.5 percent to P4.18.

Bank of the Philippine Islands, the third-biggest lender in terms of assets, was down 3.1 percent to P81.70, but major property developer Ayala Land Inc rose 3.1 percent to P39.50.

A spike in coronavirus infections across the United States and Europe, meanwhile, hit Asian markets again Friday.

The market rally fueled by excitement over a possible vaccine before 2021 and relief at Joe Biden’s US election win has given way to the reality that while there is light at the end of the tunnel, the killer disease remains rampant.

Several European economies including England and France have already been all but shut down to contain a fresh eruption, but they continue to record frighteningly high numbers of new cases—raising the possibility the measures could be extended.

And major US cities including New York and Chicago are being forced to act as leaders worry that the northern hemisphere winter will be more deadly than spring.

This all means economies that had started to see signs of life after a searingly bad first half of the year could stumble again, with some observers indicating the world will see a so-called W-shaped recovery.

Top US health adviser Anthony Fauci said while he was confident vaccines would bring an end to the pandemic, it was crucial that people “hang on and continue to double down on the public health measures.”

All three main indexes on Wall Street finished in the red, though the Nasdaq fared slightly better as tech firms benefit from bets on people using gadgets while stuck at home.

Those losses seeped into Asia, where profit-taking also played a role after a week-long rally.

Tokyo, Sydney, Singapore and Mumbai were all in the red, though there were gains in Seoul, Taipei, Wellington and Jakarta.

“Despite some truly remarkable news on the healthcare and vaccine front this week, which saw investors cheer it to the rafters… investors could not shake the sentiment-crushing aspects of the continually soaring Covid-19 cases and the unpleasantries of new economic restrictions,” said Axi strategist Stephen Innes.

“It feels a bit deflated today as investors look to hunker down for what is bound to be a winter of discontent. The vaccine cannot get here quick enough as what should be a festive time of the year looks bound to be weeks of holiday gloom,” he added.

Hong Kong and Shanghai were also hit by news that Donald Trump had signed an order banning Americans from investing in Chinese firms that could help the country’s military and security apparatus. With AFP


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