The stock market rose Tuesday in thin trading, with positive data supporting Philippine economic rebound this year.
The Philippine Stock Exchange Index added 45.80 points, 0.7 percent, to 6,809.72 on a value turnover of P5.3 billion. Gainers beat losers, 110 to 93, 49 issues unchanged.
The unemployment rate in April dropped 8.7 percent from the record high of 17.6 percent a year ago during the imposition of strict community quarantines, figures from the Philippine Statistics Authority show.
International Container Terminal Services Inc. climbed 2 percent to P149.90, while major property developer Ayala Land Inc. gained 1.8 percent at P36.95.
GT Capital Holdings Inc. of the Ty Group added 1.7 percent to P600, but AC Energy Corp. fell 2.4 percent to P7.59.
But markets mostly fell in Asia on Tuesday as investors awaited the release of key US inflation data later in the week, with another strong reading likely adding pressure on the Federal Reserve to begin reconsidering its ultra-loose monetary policy.
Tokyo finished in the red as traders brushed off news that Japan’s economy shrank less than estimated in the first three months of the year.
There were also losses in Shanghai, Seoul, Singapore, Taipei, Mumbai, Bangkok and Jakarta. Hong Kong was flat, while Sydney and Wellington saw gains.
Equities around the world are sitting close to record or multi-year highs after a stellar rally lasting more than a year, fueled by central bank largesse, vast government stimulus worth trillions of dollars, the rollout of vaccines and easing lockdowns in major economies.
But there is an increasing fear that the explosive recovery in the United States will send prices rocketing and force the Fed to wind back its market-supportive measures to prevent overheating, such as lifting interest rates.
Treasury Secretary Janet Yellen stoked those expectations at the weekend when she said that while any spike in prices caused by Joe Biden’s proposed $4.0-trillion aid plan would be short-term, higher borrowing costs would actually be welcomed after a decade of low inflation and rates.
“When the (Fed policy board) will begin tapering its asset purchase programme is still front and center for market participants,” said Kim Mundy at Commonwealth Bank of Australia, adding that officials would likely begin discussing a wind-down of their bond-buying program in July or September.
Thursday’s data is expected to show consumer prices jumped 4.7 percent last month, which would beat April’s figure and be the highest since 2008.
“Even if the upcoming inflation report later this week doesn’t show a significant deceleration in pricing pressures, it probably won’t change anyone’s opinion on inflation at the Fed,” said Edward Moya at OANDA.
“Wall Street should see investor demand improve for safe-havens such as gold, as global tax and inflation concerns intensify.” With AFP
