Stocks retreated Wednesday, tracking the movement of Asian markets as investors await the Federal Reserve’s policy meeting later in the day and the release of key US jobs data at the end of the week.
The Philippine Stock Exchange index, the 30-company benchmark, shed 20 points, or 0.3 percent, to close at 7,682.26 as five of the six major sectors declined. Only the mining and oil sector posted gains Wednesday, after the Commission on Appointments rejected the designation of Environment Secretary Regina Lopez who ordered the closure of dozens of mines in the country.
The heavier index, representing all shares, lost 1 point to settle at 4,603.12, on a value turnover of P6.4 billion. Advancers outnumbered losers, 98 to 92, while 52 issues were unchanged.
Nine of the 20 most active stocks ended in the green, led by Apex Mining Company Inc. which jumped 18.2 percent to P1.88. Other miners also climbed as investors welcomed reports that lawmakers thumbed down Lopez’s appointment. Benguet Corp. advanced 15.6 percent to P20.8, while Lepanto Consolidated Mining Company rose 8.4 percent to P0.206.
Meanwhile, most Asian markets closed lower Wednesday amid thin trading as Tokyo, Hong Kong and Seoul were closed for public holidays.
While the Fed is not expected to raise interest rates, with policymakers taking note of a recent run of weak indicators, its post-meeting statement will be parsed for clues about plans for later in the year.
“With the big slip in data recently there is no chance they raise rates, but the statement could contain a discussion about the balance sheet taper [which] so many Fed speakers have been talking about recently,” said Greg McKenna, chief market strategist at AxiTrader.
Minutes from the bank’s March meeting showed the policy board was considering tightening monetary policy by sucking cash out of the financial system, a disclosure which spooked investors early last month.
Friday sees the next key event when the US government releases jobs creation figures for April, which will be used by the Fed to gauge when it will next raise borrowing costs.
Shanghai reversed early gains to end down 0.3 percent, Sydney sank one percent and Wellington was 0.2 percent off, while Manila and Jakarta also retreated.
Singapore added 0.8 percent and Taipei was slightly higher.
Wall Street provided another healthy lead, with the Nasdaq posting yet another record while the Dow and S&P 500 also pushed higher. Markets in Europe closed with healthy gains.
The dollar held its ground above 112 yen, but the pound dipped following recent gains.
The euro is also sitting up ahead of Sunday’s second round of France’s presidential election, in which moderate Emmanuel Macron is expected to beat his far-right, anti-EU opponent Marine Le Pen.
Crude prices staged a minor recovery after both contracts tumbled more than two percent Tuesday on news that US production was rising and Libya had ramped up output.
The news offset a drop in inventories and hopes for an extension of cuts by the OPEC cartel.
In early European trade London and Frankfurt each shed 0.1 percent while Paris gave up 0.2 percent. With AFP, Bloomberg