February 17, 2020 at 08:25 pm
Manila Standard Business
The stock market rose Monday on bargain-hunting but investors remain wary on the economic fallout from the new coronavirus.
The Philippine Stock exchange Index climbed 44.85 points, or 0.6 percent, to 7,326.85 on a value turnover of P7.6 billion. Gainers beat losers, 107 to 77, with 49 issues unchanged.
Metro Pacific Investments Corp., which is into toll roads, water and electricity distribution, hospitals and infrastructure, advanced 3.6 percent to P3.18, while ISM Communications Corp. of businessman Dennis Uy rallied 5.3 percent to P2.
SM Investments Corp. of the Sy Group rose 2.3 percent to P1,015, while Aboitiz Equity Ventures Inc. of the Aboitiz Group added 2.1 percent to P50.45.
Meanwhile, the new virus weighed on the rest of Asian markets Monday as the death toll in China from the epidemic rose and infections topped 70,500.
Tokyo’s benchmark Nikkei 225 index closed down 0.7 percent after the economy shrank 1.6 percent in the three months to December from the previous quarter, even before the novel coronavirus outbreak in China hit Japan, official data showed.
“Concern over the virus is only intensifying and the mood of self-restraint is going to spread more broadly. I’m becoming downbeat on Japan’s economy,” Takashi Shiono, an economist at Credit Suisse Group, told Bloomberg News.
Mainland China’s benchmark Shanghai Composite Index closed up 2.3 percent after the central bank announced measures aimed at cushioning the economy against the health crisis.
Elsewhere, Sydney fell 0.7 percent, Taipei shed 0.4 percent and Seoul was 0.1 percent lower.
After Wall Street’s muddled performance on Friday and US markets closed Monday for a holiday, traders turned their attention to grim economic news in the region.
Japan’s economy suffered its worst quarterly contraction in more than five years, while Singapore cut its growth forecast for this year as the virus batters the city-state’s tourism and trade.
That comes after Europe’s largest economy Germany reported Friday zero growth in the last quarter of 2019 and warnings from the International Monetary Fund that the virus could damage global economic activity this year.
While investors are comforted by a slowdown in new infections outside hardest-hit Hubei province in recent days, they might be less sanguine if China’s economy takes a worse-than-expected hit, said Stephen Innes of AxiCorp.
“If it comes out bad enough for confidence to plummet, investors could quickly find themselves up the creek... without a paddle,” Innes said in a commentary.
“Financial markets are not known for their rational thinking lately and given the 500 million or so mainlanders affected by the (COVID-19) quarantine... it’s also not hard to come up with more downside risks than upside ones right now.”
A spokesman for China’s national health authority said the slowdown was a sign the outbreak was being controlled.
However, World Health Organization chief Tedros Adhanom Ghebreyesus has warned it is “impossible to predict which direction this epidemic will take.” With AFP