Stocks barely moved Thursday, following overnight losses on Wall Street and other Asian markets amid worries over a global oil supply glut.
The Philippine Stock Exchange index, the 30-company benchmark, closed almost flat at 7,295.45, as three of the six sectoral indices declined. The index was still up 6.6 percent since the start of the year.
The heavier index, representing all shares, rose 1 point to close at 4,402.81, on a value turnover of P6.6 billion. Losers outnumbered gainers, 105 to 84, while 44 issues were unchanged.
Ten of the 20 most active stocks ended in the green, led by restaurant operator Shakey’s Pizza Asia Ventures Inc. which surged 5.2 percent to P13.76 and casino company Bloomberry Resorts Corp. which climbed 3.8 percent to P7.99. Retailer Puregold Price Club Inc. advanced 3.2 percent to P45.
Meanwhile, energy firms led a broad sell-off in Asian markets Thursday following a five percent plunge in oil prices, but the dollar held on to gains after a surprisingly strong US jobs report.
Wall Street suffered another loss after a closely watched report showed a shock surge in US oil inventories that rekindled worries about a global supply glut that has hammered the crude market since mid-2014.
The Energy Department revealed a whopping eight million barrel increase in supplies over the past week–four times more than expected—owing to higher domestic production and increased stockpiling.
The news battered the oil market, with both main contracts slumping more than five percent to lows not seen since the end of last year.
Jeffrey Halley, senior market analyst at Oanda, said the report was the “straw that broke the camel’s back”, with concerns already abound that Russia was not pulling its weight on much-vaunted production cuts agreed between OPEC and non-OPEC countries in November.
And Greg McKenna, chief market strategist at AxiTrader, said there is growing unease that too much of the burden on reducing output is being shouldered by OPEC nations, particularly kingpin Saudi Arabia.
While oil edged back up Thursday, Asian energy firms took the heat. Japan’s Inpex shed 1.2 percent, Hong Kong-listed PetroChina and CNOOC were each more than two percent down and Woodside Petroleum dived 1.1 percent in Sydney.
That in turn hit wider markets, with Hong Kong down more than one percent in the afternoon and Shanghai 0.7 percent off at the close. Traders brushed off another jump in China’s factory gate prices that indicate a return to inflation in the country, with consumer inflation continuing struggle.
Sydney fell 0.3 percent and Seoul was 0.2 percent off and Singapore slipped 0.9 percent. Taipei dived one percent.
“The data catalyzed a new wave of glut concerns as the higher oil price might spur North American’s production, especially of shale oil, which may ultimately counterbalance OPEC’s effort to support oil prices,” said CMC Markets analyst Margaret Yang.
The oil figures overshadowed a surprise jump in private jobs creation in the US, which beefed up expectations for Friday’s key government jobs report and reinforced expectations the Federal Reserve will hike interest rates next week.
That in turn fired a rally in the dollar, which peaked close to 115 yen Wednesday before paring the gains, with traders still uncertain as President Donald Trump has provided little detail on his plans to ramp up infrastructure spending and cut taxes. With AFP, Bloomberg
