Stocks climbed Tuesday to push the benchmark index closer to the 7,000-point mark, after the government eased the lockdown restrictions in Metro Manila and reduced the curfew hours.
The Philippine Stock Exchange Index rose 59.24 points, or 0.9 percent, to 6,976.73 on a value turnover of P8 billion. Gainers edged losers, 106 to 101, with 59 issues unchanged.
GMA Network Inc., the biggest broadcasting company, advanced 4.6 percent to P13.06, while AC Energy Corp., a unit conglomerate Ayala Corp., increased 4.2 percent to P8.34.
Jollibee Foods Corp., the largest fast-food chain, rose 3.8 percent to P215, while Aboitiz Power Corp. of the Aboitiz Group, added 2.5 percent to P24.60.
Most stock markets in Asia also rose on Tuesday following a record-breaking day on Wall Street, but traders shifted cautiously ahead of the Federal Reserve’s next policy meeting later this week.
Tokyo ended up one percent, while Wellington added a little more with gains also seen in Sydney, Seoul, Singapore, Taipei and Mumbai.
Hong Kong fell, however, as investors returned from a long weekend, with eyes on a nuclear plant across the border in China following a US report of a potential leak. The Chinese central bank’s decision to drain liquidity from financial markets hit buying demand from investors north of the border.
Shanghai, Bangkok and Jakarta also slipped.
With coronavirus vaccines rolling out and businesses reopening in many countries, investors are broadly upbeat about the global economic outlook while fears have eased that an expected inflation spike will force central banks to taper their ultra-loose monetary policies.
The release of data last week showing US consumer prices jumped far more than forecast was taken in stride, suggesting a growing acceptance of the Fed’s insistence that spikes were to be expected owing to last year’s low base of comparison and supply bottlenecks, among other things.
That puts the Fed’s latest meeting—and boss Jerome Powell’s comments—firmly in the spotlight with dealers looking for an idea about its plans for policy in light of the US economy’s blockbuster recovery.
Several observers have warned that its pledge to not start tightening until unemployment is tamed and inflation is running persistently hot could backfire if the economy overheats, which could force it to hike interest rates at a sharper pace.
“We’re in a tug-of-war between the understanding that we’re having great economic growth and great earnings growth juxtaposed with the fact that we need to get our head wrapped around what inflation looks like and what it will mean both to profit margins and to the Fed,” said Art Hogan, chief strategist at National Securities.
The S&P 500 and Nasdaq both clocked record highs Monday.
But trading floors remain nervous places as governments in parts of the world are still battling to overcome the virus and more transmissible variants, which are either forcing them to delay reopenings or reimpose fresh containment measures. With AFP
