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Sunday, May 26, 2024

Market extends rally; Aboitiz Power climbs

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Stocks edged slightly higher Friday after a steep climb in the previous session, with investors resisting profit taking on improving economic prospects.

The Philippine Stock Exchange Index added 9.37 points, or 0.1 percent, to 6,674.51 on a value turnover of P12.4 billion. Gainers beat losers, 119 to 69, with 66 issues unchanged.

S&P Global Ratings on Thursday affirmed the investment-grade ‘BBB+’ long-term and ‘A-2’ short-term sovereign credit ratings on the Philippines, with a stable outlook. The credit rating agency said the Philippines “will continue to have good economic recovery prospects once the COVID-19 pandemic is contained, and that the government’s fiscal performance will strengthen accordingly.”

Aboitiz Power Corp. of the Aboitiz Group surged 12 percent to P23.40, while All Home Corp. of the Villar Group advanced 6.5 percent to P7.55.

Puregold Price Club Inc. of the retail tycoon Lucio Co. climbed 6.2 percent to P39.25, while Megaworld Corp., the biggest lessor of office spaces, rose 5.7 percent to P3.13.

Asian markets mostly rose Friday to end a broadly upbeat week, with traders welcoming another forecast-beating reading on US jobless claims that reinforced optimism about the recovery in the world’s top economy.

After a positive end for the Dow and S&P 500 in New York, Asia pressed ahead with its recent advances. Tokyo jumped more than two percent, thanks to a weakening yen, while Sydney and Taipei climbed more than one percent apiece.

Singapore, Seoul, Mumbai, Bangkok and Jakarta were also up while Hong Kong was flat, and Shanghai and Wellington dipped.

There was also some cheer from reports that President Joe Biden is planning a $6-trillion budget proposal for later in the day that includes his vast infrastructure deal and spending on families.

And while the huge outlays are likely to add to inflationary pressures, investors were happier to look past that, opting instead to focus on the economic boost, while Federal Reserve officials as well as Treasury Secretary Janet Yellen continue to argue that any price spikes will be transitory.

Regional equities have enjoyed a broadly positive week as inflation fears and rising virus cases take a back seat to the reflation narrative fueled by the rollout of vaccines and reopening of economies. With AFP

And on Thursday, the Labor Department said 406,000 new seasonally adjusted claims for jobless benefits were made last week, 38,000 down on the week before, much better than predicted and a pandemic low.

US media also reported that Biden will unveil his big-spending plan to give an extra jolt to the economy, even as it enjoys one of its best years of growth in decades.

Having passed his $1.9-trillion stimulus soon after taking office this year, the president now has in the pipeline a roads and bridges splurge, which he is aiming to reconcile with Republicans.  

Hopes for a deal were given a lift when the Republicans raised their offer to $928 billion, after Biden lowered his to $1.7 trillion. He also wants to push through a $1.8-trillion American Families Plan. With AFP

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