Stocks decline; Converge, SM Investments top losers

Stocks fell slightly Monday on profit-taking in dull trading as the market awaited the final guidelines of looser quarantine restrictions.

The Philippine Stock Exchange Index slipped 20.03 points, or 0.3 percent, to 6,877.10 on a value turnover of P5.3 billion. Gainers, however, beat losers, 95 to 86, with 57 issues unchanged.

SM Investments Corp. of the Sy Group declined 2.2 percent to P998 while leading fiber broadband provider Converge ICT Solutions Inc. dropped 1.2 percent to P31.50.

Universal Robina Corp., the biggest snack food maker, shed 1.6 percent to P143.40, but Jollibee Foods Corp., the largest fast-food chain, rose 2.7 percent to P206.

Meanwhile, Asian markets mostly rose Monday after a big miss on US jobs creation last month fueled optimism that the Federal Reserve will hold fire on tapering its massive financial support program, while Tokyo extended last week’s rally on hopes for more economic stimulus.

Closely watched data on Friday showed about a third of the expected number of new jobs were added to the world’s top economy in August, largely because of the spread of the Delta variant of COVID-19, which has sent infection rates around the world spiking in recent weeks.

But while the reading suggested the blockbuster recovery enjoyed at the start of this year appeared to be stuttering, observers said it will allow the US central bank to take a little more time scaling back its bond-buying monetary easing.

Fed boss Jerome Powell indicated last month that officials would begin tapering the policy, which has been a key pillar of the economic and market surge for more than a year, by the end of 2021—but would take it slowly.

He did not provide a timetable, and Friday’s jobs data was considered a crucial guide to when it would begin, with some saying a well-below-par figure would mean policymakers would not move until November or December.

“It reinforces the Delta variant impact on current economic conditions and therefore policy makers have to pivot and be agile,” George Boubouras, of K2 Asset Management, said on Bloomberg Television.

“It reinforces that some form of stimulus will remain in the system for the foreseeable future.”

The jobs data was met with a shrug on Wall Street, with the Dow and S&P 500 edging down, though the Nasdaq ticked up to another record.

Asia built on last week’s broadly positive performance.

Hong Kong, Shanghai, Seoul, Singapore, Sydney, and Wellington all rose, while Taipei and Bangkok dipped.

National Australia Bank’s Tapas Strickland said: “The market reaction to the report suggests they are viewing the jobs slowdown as transitory for now, with the Fed still likely to taper, though more likely in November or December rather than as early as September.”

Tokyo was the standout again, surging 1.8 percent going into the break after a more than two percent rally Friday. The Nikkei 225 is now closing in on levels not seen in more than 30 years. With AFP