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Stock market slips again; ABS-CBN, Puregold drop

The stock market fell for the second straight day Tuesday on continued profit taking, weighed down by lower factory production in August strongly suggesting the economy may have contracted again in the third quarter of the year.

The Philippine Stock Exchange Index slipped 28.31 points, or 0.5 percent, to 5,910.64 on a value turnover of P8 billion. Losers overwhelmed gainers, 144 to 57, with 53 issues unchanged.

Factory output declined both in value and volume in August due to lingering impact of the COVID-19 pandemic, the Philippine Statistics Authority said Tuesday. Companies have also reported a deep reduction in sales revenue despite the government’s move to ease the community quarantines in June, according to the results of a World Bank survey conducted with the Department of Finance and the National Economic and Development Authority.

ABS-CBN Corp. slumped 14.9 percent on profit taking after jumping Monday, while Aboitiz Equity Ventures Inc. of the Aboitiz Group dropped 4.5 percent to P45.50. ABS-CBN signed a block time agreement with the broadcasting network founded by Bro. Eddie Villanueva on Tuesday.

Puregold Price Club Inc. of retail tycoon Lucio Co declined 4.2 percent to 45.85, but Now Corp. of the Velarde family, the fourth major telecommunications company, advanced 13.4 percent to P4.98.

The rest of Asian equities rallied again Tuesday as investors picked up the baton from their US counterparts, with demand for higher-risk assets boosted by hopes for a new US stimulus and growing expectations Joe Biden is on course to become the next president.

Hong Kong climbed 0.8 percent, having put on around two percent in the previous two trading days, while Tokyo closed 0.5 percent higher. Sydney, Seoul, Singapore and Wellington also enjoyed healthy gains while Taipei, Bangkok and Jakarta both jumped more than one percent. Shanghai was closed for a holiday.

News that Donald Trump had returned to the White House after hospital treatment for coronavirus also lifted a major source of uncertainty over the November 3 polls, which some had feared could have been delayed.

All three main indexes rallied Monday—with the Nasdaq racing more than two percent higher—after Friday’s losses, as the president’s condition improved, while analysts pointed out that his positive test for Covid-19 could be the jolt US lawmakers needed to finally agree a new rescue package. 

Talks were revived last week with a series of phone calls and an in-person meeting between Treasury Secretary Steven Mnuchin and Democrat House Leader Nancy Pelosi.

The speaker’s deputy chief of staff Drew Hammill said the two planned to hold another call Tuesday.

“Investors are likely running with the idea that recent data and President Trump’s first-hand experience with the virus increases the odds of another fiscal package,” Adam Phillips, at EP Wealth  Advisors, said.

“It is becoming harder to deny the need for additional fiscal support.” With AFP

Topics: Stock Market , Philippine Stock Exchange , PSE , Philippine Stock Exchange Index , PSEi , Global stock market , ABS-CBN Corp. , Puregold Price Club Inc.
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