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Stock market up slightly; JG Summit leads gainers

The stock market rose slightly Friday in mixed trading after reversing early losses, with investors welcoming a forecast-busting US jobs report overnight.

The Philippine Stock Exchange Index added 8.58 points, or 0.1 percent, to 6,372.66 on a value turnover of P7.4 billion. Losers, however, beat gainers, 103 to 92, with 45 issues unchanged.

Conglomerate JG Summit holdings Corp. of the Gokongwei Group climbed 3.1 percent to P67.25, while Manila Water Co. Inc., a unit of Ayala Corp., advanced 2.7 percent to P13.64.

Altus Property Ventures Inc., a unit of Robinsons Land Corp., however, sank 24 percent to P30, while Dito CME Holdings Corp., formerly ISM Communications Corp. and the third telecommunications company owned by tycoon Dennis Uy,  fell 11.6 percent to P3.04.

The rest of the regional equities rose on Friday, though an acceleration in virus infections across the world’s top economy tempered big gains.

While the US registered more than 50,000 new cases for a second straight day and authorities across the country reimposed containment measures, traders backed up with a wall of government and central bank cash chose to look to the positives.

And a near-five million jump in employment in June, combined with promising vaccine tests, provided the platform for another market rally that saw the Nasdaq clock up yet another record.

The jobs report showed people returning to jobs in hard-hit and crucial sectors such as leisure and hospitality, which accounted for just under half of the increase.

The US advances, and a strong performance in Europe—where countries are pressing ahead with lockdown easing—gave Asia a strong lead, which investors picked up on.

Hong Kong rose 1.2 percent after climbing almost three percent Thursday, while Tokyo finished 0.7 percent higher and Shanghai jumped two percent.

Sydney climbed 0.4 percent and Seoul put on 0.8 percent, while there were healthy advances in Taipei, Seoul, Wellington, Singapore and Mumbai.

“There’s still a general positive sentiment about how quickly we’re seeing the recovery,” said Chris Gaffney at TIAA Bank.

“But we do think you’re going to see the recovery level off, especially if we continue to see higher case numbers on the virus.”

Analysts warned that while the employment data were good, jobless claims were still elevated—at 1.43 million last week, which was slightly better than the week before but missed expectations.

They pointed out that the latest spike in infections and the re-closure of some businesses around the US, particularly in the Sun Belt, could set the recovery back.

“The non-farm payrolls report is a mid-June snapshot, which might have been the ‘sweet spot’ of near-term employment optimism as the virus situation in the US has deteriorated sharply since,” warned AxiCorp’s Stephen Innes.

“It would be tough to take the better-than-expected... payrolls numbers and extrapolate that there will be a V-shaped recovery in the US,” he added. “The economy has brought back only about 30 percent of the jobs lost.” With AFP

Topics: Stock Market , Philippines Stock Exchange , PSE , Philippines Stock Exchange Index , PSEi , global stock market , JG Summit
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