The stock market surged Wednesday on vaccine breakthroughs that can revive the global economy battered by the virus spread.
The Philippine Stock Exchange Index jumped 92.64 points, or 1.3 percent, to 7,051.78 on a value turnover of P10.9 billion. Gainers beat losers, 126 to 86, with 55 issues unchanged.
Dito CME Holdings Corp., the third major mobile phone operator, rose 3.8 percent to P6.54, while AC Energy Philippines Inc., the energy unit of conglomerate Ayala Corp., advanced 8.4 percent to P4.93.
SM Investments Corp. of the Sy Group climbed 2.7 percent to P1,029, while Megaworld Corp., the biggest lessor of office spaces, added 2.6 percent to P3.89.
The rest of Asian markets mostly rose Wednesday but investors were shifting cautiously as they weighed hopes for a virus vaccine against surging infections around the world that threaten an already stuttering economic recovery.
While the mood on trading floors remains broadly optimistic about the long-term outlook, analysts said the coronavirus will continue to cause worry, while the head of the Federal Reserve warned of a “challenging” few months ahead.
Joe Biden’s election win—paving the way for a less bombastic presidency—and news that trials indicated two vaccine candidates had proved to be hugely successful have helped global markets bounce back strongly from a painful October.
The breakthroughs by Pfizer and BioNTech, and Moderna a week later, have fanned hopes that life can begin to return to normal from the start of next year, particularly giving a boost to travel and tourism stocks.
And Pfizer boss Albert Bourla on Tuesday provided more optimism when he said its drug had passed a key safety milestone, meaning it could now seek emergency-use authorization from US regulators.
“Overall risk sentiment could yet be sustained with more vaccine headlines likely over coming days,” said National Australia Bank’s Tapas Strickland.
“Oxford/AstraZeneca results are said to be ‘imminent’ and if similar to the efficacy seen in the other candidates will be important given the amount of shadow production and supply agreements undertaken by AstraZeneca.”
Hong Kong, Shanghai, Singapore, Sydney, Seoul, Taipei and Jakarta all rose.
But after a healthy rally over the past 10 trading days, investors are taking a step back, with Wall Street’s three main indexes all edging lower Tuesday.
Tokyo, Wellington, Mumbai and Bangkok also fell in Wednesday trade.
Raging Covid-19 cases across the US and Europe—and a pick up elsewhere including Japan and South Korea—are of immediate concern, analysts said.
Traders are also growing worried that US lawmakers are not doing enough to agree on a new, much-needed stimulus for the world’s top economy as it shows signs of slowing in the face of the new wave of infections.
Months of talks ahead of the November 3 election failed to reach a breakthrough, and Republicans who are likely to keep power in the Senate show no signs of backing down to Democrat demands for a multi-trillion-dollar package.
“With the election uncertainty out of the way it’s about Covid; we’ve seen this exponential growth in cases,” David Kudla, CEO of Mainstay Capital Management CEO.
“It’s also about fiscal stimulus, when that finally comes, how much we get. We know we have good news on the vaccines, but those are out in the future.” With AFP