spot_img
28.1 C
Philippines
Saturday, March 30, 2024

Stocks up on bargain hunting; SM Prime and Ayala Land rally

- Advertisement -

Stocks surged Monday in a technical rebound as many investors went bargain hunting after the benchmark index slumped in recent sessions on fears of surging global inflation and supply chain woes inflicted by Beijing’s punishing zero-COVID policy.

The Philippine Stock Exchange Index jumped 122.95 points, or 1.9 percent, to 6,502.12 on a value turnover of P8 billion. Gainers beat losers, 118 to 79, with 43 issues unchanged.

SM Prime Holdings Inc. of the Sy Group, the biggest mall operator, advanced 4 percent to P36.50, while parent SM Investments Corp. rose 2.4 percent to P808.

Major property developer Ayala Land Inc. of the Ayala Group climbed 3.3 percent to P28.40, while PLDT Inc. of Indonesia’s Salim Group, the largest telecommunications firm, added 1percent to P1,950.

The rest of Asian equities retreated Monday following last week’s temporary rally on Wall Street.

- Advertisement -

World markets have been volatile for much of 2022, fueled by uncertainty over supply chain snarls due to China’s lockdowns, inflation pressures and anxiety over Russia’s invasion of Ukraine. 

Wall Street stocks closed Friday with a robust rally on the tech-rich Nasdaq after a tumultuous week that saw markets fluctuate based on US inflation data and an ongoing slump in Chinese exports.

One of the main drivers of volatility is China’s continued lockdowns. Economic engine Shanghai in particular has been under strict virus restrictions since April, shuttering factories and pausing port activity. 

The extent of the economic hemorrhaging was revealed Monday when China’s National Bureau of Statistics announced that retail sales had slumped by 11.1 percent on-year in April and its industrial production sank 2.9 percent—the lowest showing since March 2020.

“It is clear that the impact of lockdowns, or the fear of lockdowns, overwhelmed any economic easing, and the Shanghai lockdown had ripple effects across the nation,” said Wei Yao, head of research for Asia Pacific and chief economist at Societe Generale SA, according to Bloomberg.

The urban unemployment rate also climbed to its highest level in more than two years—which Wei said will be of particular worry to China’s leadership. 

“If this set does not raise the urgency of adjusting the zero-COVID measures to allow the economy to normalize, we don’t know what will,” she said.

Beijing’s staunch adherence to its zero-COVID strategy has reverberated across the world, snarling global supply chains, agitating commodity prices and spiking investor fears. 

“The market continues to trade on very short-term recessionary signals. It is very ‘noisy,’ keeping intraday volatility high with 150–250-point swings (being) common,” said Stephen Innes of SPI Asset Management. 

“Indeed, this is the hallmark of a market filled with air pockets which have left more than a few investors licking their wounds.”

Markets in Asia were mixed throughout the day. Economist Clifford Bennett of ACY Securities said “there is a very real risk, even likelihood of a triple Northern Hemisphere recession across the US, Europe and China simultaneously and virtually immediately.” With AFP

- Advertisement -

LATEST NEWS

Popular Articles