Stocks down on profit taking; First Gen up

Stocks retreated Wednesday on profit taking, weighed down by the slow rollout of vaccines in the Philippines and a spike in infections in some countries.

The Philippine Stock Exchange Index dropped 69.50 points, or 1 percent, to 6,785.94 on a value turnover of P8.8 billion. Gainers, however, edged losers, 101 to 97, with 41 issues unchanged.

Universal Robina Corp. of the Gokongwei Group, the biggest snack food maker, fell 4.5 percent to P144, while parent JG Summit Holdings Inc. declined 4.2 percent to P62.20.

SM Investments Corp. of the Sy Group lost 2.4 percent at 985, but First Gen Corp. of the Lopez Group jumped 13.6 percent to P32.15.

Meanwhile, Asian markets mostly rose Wednesday as investors tried to assess whether the global recovery will be resilient enough to withstand the fast-spreading Delta COVID variant.

However, optimism continues to be tested by China’s drive to tighten its grip on the world’s number two economy with a swathe of new regulations for private enterprises.

Federal Reserve boss Jerome Powell’s indication Friday that the central bank will take it easy in winding back its ultra-loose monetary policy—and even more cautious in hiking interest rates—has helped fuel a healthy run-up this week.

Still, Wall Street finished Tuesday on a tepid note after a closely watched survey showed US consumer confidence saw a sharp drop in August to its lowest level in six months owing to concerns about Delta and surging prices.

“A combination of higher prices—still much in evidence across a swathe of incoming US data—and doubtless too the resurgence in Delta-strain COVID-19 infections, and hospitalizations, are taking a toll,” said Ray Attrill of National Australia Bank.

“How temporary this will prove to be of course remains to be seen.”

While the United States remains largely open thanks to a successful vaccine rollout, other countries that have administered fewer jabs are struggling with fresh waves of COVID and are being forced to impose strict containment measures.

This has tempered hopes that the blockbuster economic recovery seen at the start of the year can be maintained.

Tokyo, Hong Kong, Shanghai, Singapore, Seoul and Wellington were all in positive territory but Sydney, Taipei, Mumbai, Bangkok and Jakarta fell.

Asia started the day on a mixed note but most major markets recovered in the afternoon, with traders appearing to brush off data indicating Chinese factory activity contracted last month.

The Caixin purchasing managers index reading came a day after an official report suggesting manufacturing activity barely growing and services sector activity shrinking.

Focus is now on the release Friday of US jobs data, which could have a huge bearing on when the Fed decides to start winding down its bond-buying financial support program.

Oil prices rose ahead of the monthly meeting of OPEC and other producers who are expected to continue raising output with the global recovery largely still on track. With AFP