Stocks climb; SM Prime, DMCI gain

The stock market rose Wednesday in mixed trading as investors weighed the positive economic performance in the second quarter and lingering worries over the spreading Delta variant.

The Philippine Stock Exchange Index added 43.63 points, or 0.7 percent, to 6,666.86 on a value turnover of P6.8 billion. Losers, however, edged gainers, 84 to 81, with 56 issues unchanged.

SM Prime Holdings Inc. of the Sy Group, the biggest shopping mall operator, advanced 3.2 percent to P35, while DMCI Holdings Inc of the Consunji Group climbed 3.2 percent to P5.88.

Major property developer Ayala Land Inc. of the Ayala Group increased 3 percent to P34.20, but International Container Terminal Services Inc., the largest port operator and owned by tycoon Enrique Razon Jr., fell 2.2 percent to P180.

The rest of Asian markets were mixed Wednesday as investors assess the impact of the fast-spreading Delta variant and the future of Federal Reserve financial support against expectations that the global economy will eventually recover from the pandemic crisis.

News that US President Joe Biden’s $1.2-trillion infrastructure spending bill had finally passed the Senate provided some cheer, though analysts said it would likely be some time before it gets through the House owing to differences among Democrats.

Equities have had a largely positive start to the week after a recent run of pressure caused by profit-taking—many markets were sitting around record or multi-year highs—and concerns about China’s crackdown on sectors including tech and private tuition.

But the key driver of unease has been the surge in new infections of the Delta COVID mutation, which has forced a number of governments around the world to reimpose lockdowns and other containment measures.

While the new case rates are rising in places with struggling vaccination programs, spikes in countries with high inoculation rates such as Israel, the United States and Britain are also seeing it spread.

Still, investors remain by and large upbeat that the world economy will eventually ride the disease out, even if it does take the recovery longer than initially hoped.

“There’s clearly more focus and concern on the Delta variant of COVID, but, to this point, markets have appraised that as a manageable risk,” David Donabedian, of CIBC Private Wealth Management, said. “The market is climbing the wall of worry.”

Tokyo, Hong Kong, Shanghai and Sydney rose  but Singapore, Seoul, Wellington, Taipei, Mumbai and Bangkok fell.

That came after the Dow and S&P 500 ended at new record highs.

Eyes are firmly on the release later in the day of US July inflation data, which could have a bearing on the Fed’s decision on when to start tapering the vast bond-buying program that has been a major pillar of support for global markets since April last year.

Soaring prices in recent months and blockbuster jobs creation in June and July have ramped up pressure on the bank to tighten policy in order to prevent the economy from overheating. With AFP