Stocks rise in last-minute buying; SM Prime climbs

The stock market rose slightly Thursday for the second day in last-minute buying, with many investors still cautious amid rising cases of COVID-19.

The Philippine Stock Exchange Index added 16.75 points, or 0.3 percent, to 6,539.96 on a value turnover of P5.4 billion. Gainers edged losers, 103 to 100, with 46 issues unchanged.

Miner Apollo Global Capital Inc. jumped 16.3 percent to P0.235, while SM Prime Holdings Inc. climbed 2.2 percent to P36.50.

Megaworld Corp., the biggest lessor of office spaces, fell 3.7 percent to P3.35, while AC Energy Corp., a unit of Ayala Corp., dropped 2.8 percent to P7.18.

The rest of markets in Asia were mixed on Thursday as investors put the brakes on a recent rally that has some worried valuations may have run a little too high.

The underwhelming performance followed a tepid lead from Wall Street, where only the Dow managed to eke out a gain despite blowout profits at top banks that gave a healthy start to the much-anticipated earnings season.

Observers also said the Chinese central bank’s moves to keep a lid on liquidity in the financial system as it tries to control debt issuance showed Beijing was happy enough with its recovery that it was pulling back on last year’s stimulus measures.

“The expectation in the market is that the central bank will gradually tighten its liquidity as it seeks policy normalization after the pandemic,” Zhang Gang of Central China Securities, said.

After hitting a series of records or multi-year highs in recent months, world markets are struggling to push any higher without any new major catalysts, with the latest round of corporate reporting now the main focus.

Traders are also keeping an eye on developments in the pandemic crisis as infections in some countries rise and after vaccine programs were dealt a blow by blood clot concerns over the Johnson & Johnson jab as well as that from AstraZeneca.

Shanghai, Hong Kong, Jakarta and Wellington were all down while Tokyo, Sydney, Seoul, Singapore and Taipei rose.

But Patrik Schowitz at JP Morgan Asset Management warned he was less upbeat about regional equities, which he said were dominated by growth and tech firms. Those sectors have come under pressure of late owing to expectations that interest rates will rise as the world economy rebounds.

“In addition to that, the biggest economy in the region is expected to see more policy normalization: China has now recovered enough that policymakers can afford to be more conservative and worry more about containing debt and property market risks,” he said.  

“That will be a headwind to China equities, despite the solid economy.”

He added that fears over inflation continued to be a big risk for markets, as investors bet that the explosion of economic activity fanned by vaccines, reopenings and stimulus measures—particularly in the United States—would force central banks to wind in their ultra-supportive monetary policies. With AFP

Topics: Philippine Stock Exchange Index , COVID-19 , Miner Apollo Global Capital Inc , Megaworld Corp
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