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Stocks end 4-day rally; Emperador advances

The stock market fell Friday on profit taking to snap a four-day rally, with select blue chips leading the retreat.

The Philippine Stock Exchange Index slipped 20.87 points, or 0.3 percent to 6,076.91 on a value turnover of P9.5 billion. Losers beat gainers, 97 to 88, with 56 issues unchanged.

Semirara Mining and Power Corp., the biggest coal miner, dropped 5.8 percent to P9.04, while JG Summit Holdings Inc. of the Gokongwei Group declined 5 percent to P61.30.

AREIT Inc. of Ayala Land Inc., the country’s first real estate investment trust company that made its debut in the stock market Thursday, shed 3.2 percent to P24.10. Share price of AREIT fell in its debut to P24.90, down 7.8 percent from its initial public offering price of P27.

Emperador Inc., the liquor unit of tycoon Andrew Tan, however, advanced 7.6 percent to P10.98.

The rest of Asian stock markets were mixed Friday following a broadly healthy week but investors are increasingly worried about the stalemate in Washington over a new stimulus for the world's top economy.

Hopes that Democrats and Republicans would cast aside their mutual animosity to stump up much-needed cash for struggling Americans have been key to supporting equities for weeks.

But they were dealt a blow Thursday when senators broke up for a summer recess, saying they would not return until early next month, while both sides continued to trade accusations over who was to blame for the impasse.

Democrats have called on Republicans and the White House to double their $1-trillion offer, having reduced their own proposal to $2 trillion from an initial $3.5 trillion.

Senator Leader Mitch McConnell accused his opponents of pushing for several socialist measures to be introduced into the new bill, describing their tactics as "throwing spaghetti at the wall to see what sticks."

Still, the expectation remains that an agreement will at some point be found, particularly with an election just over two months away and millions of Americans in financial crisis.

"Congress' political grandstanding delay is posing some risk for the global recovery," said Stephen Innes at AxiCorp. 

"Still, there is no chance of this deal not going through... It is a matter of whether it is $1.5 trillion or $2 trillion, where bigger would be better."

Tokyo closed 0.2 percent higher and Shanghai ended more than one percent up, with Hong Kong edging up 0.2 percent. Sydney rose 0.6 percent and Mumbai put on 0.5 percent, while Taipei and Jakarta were also in positive territory.

But Seoul fell more than one percent, and Bangkok shed 0.6 percent.

Traders had a weak lead from Wall Street, where the stimulus struggle trumped better-than-expected data showing fewer than a million people claimed jobless benefits last week for the first time since the pandemic struck in March.

"US jobless (figures) have begun to decline again, suggesting the US labor market is starting to improve, notwithstanding the economic impact from the containment measures introduced to combat the COVID-19 outbreak," said Rodrigo Catril at National Australia Bank.

But he warned: "Ironically, an improving labor market may ease the pressure on US politicians to come up with a new stimulus plan."

Topics: stock market , Philippine Stock Exchange Index , Semirara Mining and Power Corp.
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