The stock market rose slightly Monday on thin trading as investors await the release of the June inflation rate today.
The Philippine Stock Exchange Index added 18.27 points, or 0.3 percent, to 6,183.62 on a value turnover of P3.8 billion. Losers, however, beat gainers, 111 to 69, with 50 issues unchanged.
Fiber broadband provider Converge ICT Solutions Inc. surged 5 percent to P22, while PLDT Inc., the biggest telecommunications firm owned by Indonesia’s Salim Group, climbed 3.5 percent to P1,729.
SM Investments Corp. of the Sy Group, advanced 3.9 percent to P800, while unit BDO Unibank Inc., the largest lender in terms of assets, rose 3 percent to P115.50.
The rest of Asian markets swung Monday as traders fret over a possible recession caused by central bank interest rate hikes aimed at fighting soaring inflation.
Data showing a flare-up of fresh COVID-19 cases in China revived concerns about the government’s policy of locking down towns and cities to eradicate the disease, despite the economic cost.
After the S&P 500’s worst January-June since 1970, Wall Street got the second half off to a healthy start Friday as a below-forecast reading on US manufacturing provided hope banks will not go on an extended period of monetary tightening.
That followed a drop in confidence among consumers—a key driver of the world’s top economy.
However, National Australia Bank’s Rodrigo Catril said the Federal Reserve and other global financial chiefs might not ease back on their rate hikes too soon as inflation remains stuck around multi-decade highs.
“While the data is suggesting a US economic slowdown is coming, we are not yet seeing signs of an ease in inflationary pressures, an important distinction given the Fed will continue with its aggressive tightening approach until it sees evidence of the latter,” he said in a commentary.
In a sign of the struggle officials will have in controlling rising prices, figures showed eurozone inflation hit a record 8.6 percent in June. The European Central Bank is due to lift rates this month for the first time in more than a decade.
Still, while surging prices remain a huge problem, Chris Weston, at Pepperstone Group, said the psychology is “shifting radically from inflation concerns to one now where we’re firmly focused on growth”.
While New York provided a strong lead, Asia struggled.
Hong Kong dropped as investors returned from a long weekend to play catch-up with Friday’s losses, while Seoul, Taipei, Bangok and Jakarta were also down.
However, Tokyo, Shanghai, Mumbai, Sydney, Singapore, Taipei and Wellington rose.
A rise in new COVID cases in China over the weekend weighed on sentiment among investors who fear a return to the painful lockdowns in major cities including Shanghai, which hammered the world’s number two economy.
The country saw more than 700 new infections Saturday and Sunday, having held below 50 a day for the previous two weeks.
Macau saw its first two COVID deaths at the weekend and authorities said they would consider a city-wide lockdown to fight the disease. The comments sent Hong Kong-listed shares in Macau casinos plunging. With AFP