The stock market dropped Monday on concerns the lingering pandemic and a spike in the inflation rate that could both delay the recovery of the domestic economy kept investors at bay.
The Philippine Stock Exchange Index lost 31.8 points, or 0.4 percent, to 6,959.21 on a value turnover of P16.6 billion. Losers, however, beat gainers, 123 to 98, with 44 issues unchanged.
Fiber internet provider Converge ICT Solutions Inc. rallied 5.9 percent to P18.78, while GT Capital Holdings Inc. of the Ty Group climbed 3.3 percent to P568.
MerryMart Consumer Corp., the supermarket chain owned by businessman Edgar Sia II, rose 2.7 percent to P7.25, but AC Energy Corp., a unit of Ayala Corp., fell 2.7 percent to P7.66.
The rest of Asian markets rallied again Monday, extending a global advance after another record on Wall Street as traders were cheered by the prospect of a huge new US stimulus as well as further falls in coronavirus infection and death rates.
Tokyo was the standout performer, with the Nikkei 225 breaking through 30,000 points for the first time in 31 years as data showed Japan’s economy performed better than expected at the end of last year.
Equities across the planet have been surging for months as vaccination programs kick into gear and fewer people come down with the virus, fueling hopes that economically painful containment measures can begin to be lifted.
The optimism has pushed oil prices to highs not seen since last January.
The optimistic mood on trading floors also helped push all three main indexes on Wall Street to new records last week, and Asia took up the baton with gusto on Monday.
Tokyo surged nearly two percent to crack 30,000 for the first time since 1990, helped by data showing the Japanese economy contracted less than feared last year.
Seoul, Mumbai and Bangkok climbed more than one percent, while Sydney, Singapore and Jakarta were also in the green.
However, Wellington fell following news that two coronavirus infections that have prompted a snap lockdown of Auckland were the country’s first cases of the highly contagious strain first detected in Britain.
Hong Kong, Shanghai and Taipei were closed for holidays.
The end of Donald Trump’s Senate impeachment trial at the weekend also allows US lawmakers to concentrate on pushing through President Joe Biden’s vast rescue package.
There had been an expectation that the $1.9-trillion proposal could be watered down as Republicans and some Democrats pushed back against its size, but there is an increasing belief that the final figure could be closer to the president’s plan.
However, while the broad consensus is for the world economy to soar this year, there is a growing concern that the Biden spending splurge could exacerbate an expected jump in inflation.
That could force central banks to tighten their ultra-loose monetary policies, which have been a key driver of markets’ recovery.
And Treasury Secretary Janet Yellen called on her Group of Seven counterparts to join the United States in opening the taps, saying in her first meeting that “the time to go big is now.” With AFP