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Market climbs; ABS-CBN surges

The stock market rose slightly Thursday but coronavirus fears weighed on the rest of Asian markets Thursday despite China reporting a big drop in new cases and easing borrowing costs to cushion the epidemic’s economic impact.

The Philippine Stock exchange Index added 16.06 points, or 0.2 percent, to 7,413 on a value turnover of P5.8 billion. Gainers edged losers, 90 to 84, with 54 issues unchanged.

Beleaguered ABS-CBN Corp. of the Lopez Group, the biggest broadcasting firm, jumped 20.4 percent to P21.80, while Metropolitan Bank & Trust Co., the largest lender in terms of assets, climbed 2.7 percent to P60.60.

Jollibee Foods Corp., the biggest fast-food chain, advanced 2.2 percent to P188, while SM Prime Holdings Inc. rose 1.3 percent to P41.65.

Asian traders, meanwhile, have been betting on central banks, particularly China’s, doing what it takes to keep their economies chugging along as the new coronavirus hits corporate earnings and economic growth.

In a widely anticipated move, the People’s Bank of China lowered its one-year and five-year loan prime rates as policymakers seek to reduce the impact of the virus-fueled slowdown on companies and households.

But the moves were “not nearly enough,” said Stephen Innes of AxiCorp.

“The PBoC needs to exceed the market expectations, not hit them in this environment,” he said.

“If the PBoC made a bigger splash, the market would have reacted more favorably.”

Sentiment had improved in recent days amid growing hopes that the impact of the virus—which has killed more than 2,100 people and infected over 74,000, mostly in China—will be short-lived.

China reported a big drop in new cases on Thursday, fueling hopes the epidemic is nearing its peak.

Overnight gains on Wall Street and in Europe flowed into Asia at the start of the trading, but soon began to evaporate on several bourses.

Japan’s benchmark Nikkei 225 index closed up 0.3 percent, largely helped by a cheaper yen as the dollar strengthened against other major currencies.  

Mainland China’s key Shanghai Composite Index was up 1.1 percent on the back of the fresh stimulus.

However, Hong Kong fell 0.5 percent and Seoul was down 0.4 percent after a sharp increase in virus cases.

Taipei shed 0.3 percent, Singapore was off 0.6 percent, while Sydney was up 0.3 percent.

The World Health Organization on Wednesday hailed the “tremendous progress” in fighting the new coronavirus that emerged in China at the end of 2019 and has affected dozens of countries and territories.  

IMF chief Kristalina Georgieva warned the virus comes at a time when the global economy is fragile.

She said while the economic impact was likely to be small, “a long-lasting and more severe outbreak would result in a sharper and more protracted growth slowdown in China.”

The market’s relatively sanguine mood could change.

“Over the next couple of months we are going to see very bad economic data coming out of China and the rest of the Asian markets,” Suresh Tantia, senior investment strategist at Credit Suisse, told Bloomberg TV. With AFP

Topics: Stock market , ABS-CBN , coronavirus , Philippine Stock exchange Index , Metropolitan Bank & Trust Co , China , Hong Kong
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