The stock market retreated Friday on profit taking, as disappointing recent US and China data jolted optimism over the economic recovery that has helped drive gains for the past few months.
The Philippine Stock Exchange Index fell 58.91 points, or 1 percent, to 6,088.75 on a value turnover of P4.1 billion. Losers beat gainers, 123 to 69, with 44 issues unchanged.
SM Prime Holdings of the Sy Group dropped 4.6 percent to P31.20, while major property developer Ayala Land Inc. declined 3.6 percent to P31.70.
Metro Pacific Investments Corp., which is into toll roads, water and electricity distribution, hospitals and infrastructure, slipped 2.1 percent to P3.26, while MerryMart Consumer Corp., the newly-listed grocery chain owned by businessman Edgar Sia II, shed 3.4 percent to P2.60.
Most Asian markets, meanwhile, edged up Friday following an across-the-board sell-off the previous day.
Traders have for weeks been able to look past fresh spikes in infections around the globe to focus on the trillions of dollars spent on government support and the easing of lockdowns.
But with containment measures being reintroduced in parts of the world that had appeared in control of the outbreak—including Hong Kong, Japan and Australia—confidence has taken a hit.
Markets around the world tumbled Thursday, though they staged a mild recovery ahead of the weekend.
Hong Kong added 0.5 percent and Shanghai inched up 0.1 percent after collapsing 4.5 percent following a rally of around 15 percent since the start of July.
Mumbai rose 0.7 percent, despite news that India had become the third country to record more than a million cases of COVID-19, while lockdowns are put in place in several regions.
Sydney added 0.4 percent and Seoul climbed 0.8 percent. Taipei, Bangkok and Wellington also edged up but there were losses in Singapore and Jakarta. Tokyo finished 0.3 percent lower.
Data out of China on Thursday showed that while the economy grew more than expected, the crucial reading on retail sales was below forecasts, indicating consumers—key to reigniting growth—were still reluctant to go out and spend.
A later report showed US retail sales continued to rise in June, but at a slower pace than May.
And new claims for US unemployment benefits last week were little changed from the previous week at 1.3 million, a historically high level. Economists fear the figure might rise again as major states including California and Texas impose fresh lockdown measures. With AFP
“Data released over the last 24 hours seriously questions the speed of any post-COVID-19 economic recovery,” said Michael McCarthy, at CMC Markets. “The numbers illustrate the economic challenges posed by secondary infection outbreaks.”
Observers were cautious about the outlook for the recovery in light of the surge in new infections.
“Try as one may, it’s challenging to look through the makeup of China’s economic recovery, which offers a roadmap to the rest of the world that is not especially bullish for one that is wholeheartedly predicated on consumer-driven recovery,” said Stephen Innes at AxiCorp. With AFP