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Market declines further; Basic, Apollo lead losers

Stocks fell for the fifth straight day Thursday, with many investors taking interest on penny issues that have dominated the market in the past few days.

The Philippine Stock Exchange Index dropped 24.78 points, or 0.4 percent, to 7,118.52 on a value turnover of P9.7 billion. Losers overwhelmed gainers, 177 to 56, with 39 issues unchanged.

Basic Energy Corp. slumped 29.6 percent to P1.19, while magnetite iron miner Apollo Global Capital Inc. sank 29.1 percent to P0.305.

A shares of Oriental Petroleum and Minerals Corp. tumbled 28.6 percent to P0.015, while The Philodrill Corp. declined 29.2 percent to P0.017.

Asian and European markets, meanwhile, welcomed Joe Biden’s first day as US president with broad gains Thursday as investors looked forward with optimism about his economic and COVID-19 recovery plans.

Soon after being sworn in, Biden signed more than a dozen executive orders unwinding many of his predecessor’s policies.

These included rejoining the World Health Organization, a move observers say will help in the fight against the devastating disease.

He also brought the US back into the Paris climate accord, as well as extending a mortgage foreclosure moratorium and a pause on student debt repayments.

The moves came as the new administration looks to push through a $1.9-trillion relief package for the world’s largest economy that encompasses, among other things, $1,400 cash payments to struggling Americans.

Investors have welcomed Biden’s election and his pledges to kickstart growth, which has offset concerns about his plans for higher taxes and market regulation.

In his inauguration address, Biden pledged to “rebuild the economy” and “rebuild the backbone of the country: the middle class.”

His pick for Treasury secretary, Janet Yellen, provided a shot in the arm for markets on Tuesday by reasserting her determination to drive through the stimulus package, telling lawmakers to “go big” if they wanted to rescue the economy.

There is also a hope that he will devote more time to fighting the coronavirus, which has killed more than 400,000 people in the United States and two million worldwide.

Still, OANDA’s Jeffrey Halley had a word of warning for traders.

“One critical risk remains and is being totally ignored by financial markets everywhere. That is the inclination of the Republican minority in the US Senate to bipartisanship,” he said.

“Their silence has been deafening until now on how cooperative they intend to be with the new president.”

Still, all three main indexes on Wall Street surged to record highs, and Asian investors took up the baton with relish.

Tokyo, Shanghai, Sydney, Seoul, Singapore, Taipei, Bangkok and Wellington all rose, though Jakarta dipped.

Mumbai’s Sensex also climbed, topping 50,000 for the first time, while London, Paris and Frankfurt all opened with gains.

Hong Kong was slightly lower on profit-taking after five days of gains, having earlier in the day breached 30,000 points for the first time since April 2019.

“Stock markets continue to reflate post-inauguration with the consensus view now that... Biden’s early focus will be more on growth than tax hikes,” said Axi strategist Stephen Innes.

“The market is also seeing through longer lockdowns on the premise that COVID vaccinations will lead us out of the pandemic quickly.” With AFP

Topics: Stock Market , Philippine Stock Market , PSE , Philippine Stock Exchange Index , PSEi , global stock market , Basic Energy Corp. , Apollo Global Capital Inc.
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