Market rises; URC leads gainers

Stocks rose Tuesday in line with an Asian rally, as the local equities market reopened after thick ash fall from Taal Volcano eruption disrupted trading a day earlier.

The Philippine Stock Exchange index, the 30-company benchmark index, gained 16 points, or 0.2 percent, to close at 7,793.25.  It was also up 0.3 percent since the start of the year.

The broader all-share index closed nearly unchanged at 4,605.97 on a value turnover of P9.9 billion. Losers outnumbered gainers, 111 to 83, while 54 issues were unchanged.

Eleven of the 20 most active stocks ended in the green, led by Universal Robina Corp. which climbed 6.5 percent to P149.40 and Security Bank Corp. which rose 3.2 percent to P192.  Globe Telecom Inc. went up 3.1 percent to P2,042.00.

Meanwhile, Asia equities extended a global rally on Tuesday, with the US decision to no longer designate China a currency manipulator a further sign of easing tensions between the economic titans.

The Treasury announcement came days before the two sides are due to sign off on the first part of a wider trade agreement that has helped fan a rally in world markets.

It also led to a sell-off in safe-haven assets with the yen at a seven-month low and gold down almost one percent, while oil was also struggling with the US-Iran flare-up seemingly in the rear window for investors.

Asia was given a firm lead from Wall Street, where all three main indexes ended higher—with the Nasdaq and S&P 500 hitting fresh records—on reports the US was about to remove the manipulator label from China.

Donald Trump accused Beijing in August of weakening its yuan currency “to steal our business and factories”, re-stating a long-standing grievance.

But soon after the end of trade on Monday, the Treasury said in its semi-annual report to Congress that the unit had strengthened and Beijing was no longer keeping it artificially weak.

The yuan jumped more than one percent at one point Tuesday before easing slightly. The currency is up more than four percent from an 11-year low touched in September.

“The yuan is the purest and best barometer to gauge the market’s view on US-China trade tension,” said AxiTrader’s Stephen Innes. “With the yuan strengthening ahead of the ‘phase one’ deal signing, it’s indicating the potential for further improvement in trade relations.”

The US reversal of China’s status as a manipulator “is a most precise and definitive de-escalation of trade tension to date and provides a less congested road as we pivot to phase two of the broader trade agreement,” he said.

Data on Tuesday showed China’s trade surplus with the US narrowed 8.5 percent in 2019, which will likely play well in the White House, where the huge disparity is a key bone of contention in the White House and a major catalyst of the trade war.

Tokyo was among the biggest gainers, rising 0.7 percent as the dollar advanced against the yen owing to a rush out of safety—giving a boost to Japan’s exporters.

Singapore and Seoul each put on 0.4 percent, Sydney added 0.9 percent, Wellington climbed 0.7 percent and Taipei gained 0.6 percent. Mumbai and Bangkok edged up 0.1 percent, while Jakarta rose 0.2 percent. With AFP

However, Hong Kong and Shanghai both slipped 0.3 percent on profit-taking following recent advances. With AFP

Topics: Taal Volcano eruption , Philippine Stock Exchange , Universal Robina Corp.
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