Market declines; Ayala Land advances

Stocks fell Thursday on lack of catalysts, with investors still worried over the slow vaccine rollout in the country.

The Philippine Stock Exchange Index dropped 48.07 points, or 0.8 percent, to 6,197.64 on a value turnover of P5.5 billion. Gainers, however, edged losers, 101 to 90, with 50 issues unchanged.

DITO CME Holdings Corp., the third major mobile phone company, retreated 5 percent to P9.35, while SM Investments Corp. of the Sy Group dropped 2.6 percent to P900.

Major property developer Ayala Land Inc. rose 2.7 percent to P32.20, while canned good maker Century Pacific Food Inc. climbed 4.6 percent to P23.

The rest of Asian markets were mixed in early trade Thursday after minutes showed some Federal Reserve officials contemplating a wind-down of its vast monetary easing measures, while optimism remained buoyed by the outlook for the economic recovery.

Bitcoin stabilized after Wednesday’s wild gyrations that saw it collapse almost a third in one day before recovering most of its losses.

Tokyo ended slightly higher, and Sydney and Wellington added more than one percent, while Singapore, Bangkok and Jakarta also rose.

Hong Kong dropped as it reopened after a midweek holiday to play catch-up with Wednesday’s global losses, as Shanghai, Seoul, Taipei and Mumbai also retreated.

Global equities have soared after hitting their pandemic nadir in March last year, thanks to central bank largesse and mind-boggling government spending measures, with recent gains also helped by the rollout of vaccines and easing of lockdown measures.

But investors have for months grown increasingly concerned that the blockbuster bounce-back expected in the world economy will fan inflation as the stimulus mixes with cashed-up consumers who have been unable to spend finally being let loose.

And data suggests those fears are coming true as recent inflation readings in several countries beat forecasts, with supply shortages and a low base effect from last year compounded by companies hiking wages to attract workers.

The Fed has repeatedly insisted that it sees the upward pressures as transitory and that prices will stabilize next year, adding that it will maintain its ultra-easy policies and record low interest rates until unemployment has been tamed and inflation is running consistently hot.

However, with the economy well on the recovery track, minutes from the Fed’s April meeting released Wednesday indicated some board members consider the time may soon come to at least begin discussing the bank’s position.

“A number of participants suggested that if the economy continued to make rapid progress toward the committee’s goals, it might be appropriate at some point in upcoming meetings to begin discussing a plan for adjusting the pace of asset purchases,” the minutes said.

Analysts pointed out that the meeting came before figures showed US inflation rocketed more than estimated in April, meaning the worries of those hawkish board members may have since been heightened. With AFP