Stocks closed virtually flat Thursday on mild profit-taking as a rally in oil prices ramped up inflation fears.
The Philippine Stock Exchange Index slipped 11.03 points, or 0.2 percent, to 6,758.59 on a value turnover of P5.3 billion. Losers beat gainers, 97 to 79, with 56 issues unchanged.
International Container Terminal Services Inc. of tycoon Enrique Razon Jr., the biggest port operator, fell 3.8 percent to P203, while Metropolitan Bank & Trust Co. of the Ty Group, the second-largest lender in terms of assets, dropped 3.7 percent to P51.80.
Conglomerate Ayala Corp. of the Ayala Group declined 3.3 percent to P671, but Noodles maker Monde Nissin Corp. climbed 7.1 percent to P15.
Most Asian equity markets, meanwhile, fell Thursday, with top officials warning of more pain to come, while focus turns to a meeting of the European Central Bank.
Buyers on Wall Street were in retreat again after data showed US crude and gasoline stockpiles sank, just as the summer driving season begins and a leading OPEC member warned demand would surge further as China moves to reopen.
Adding to the gloom was the OECD’s sharp downward revision of its global growth outlook and doubling of its inflation forecast.
The glum mood was only slightly offset by ongoing optimism that Beijing’s tech crackdown was close to an end.
In Asian trade, Hong Kong dropped, even as tech firms continued to benefit from hopes that China’s crackdown was almost over, while Shanghai, Sydney, Seoul, Singapore, Taipei and Wellington were also in the red.
Both main crude contracts edged down but held most gains after jumping more than two percent Wednesday to three-month highs after figures showed the biggest US storage depot had seen a big fall in reserves last week, suggesting elevated prices were not deterring people from driving.
Meanwhile, White House Press Secretary Karine Jean-Pierre said officials expect Friday’s keenly awaited consumer price index will be “elevated.”
The comment lifted expectations that the Federal Reserve will stick to its hawkish path and hike interest rates by half a point for at least three more meetings this year as it tries to bring down inflation from four-decade highs.
Analysts said investors were unlikely to get any reprieve until crude—a key driver of inflation since Russia’s invasion of Ukraine—was brought under control.
“A pullback in crude would be crucial for any prolonged risk rally, given implications for inflation expectations,” said SPI Asset Management’s Stephen Innes.
“And for the central bank fraternity intent on front-loading rates, chapter two of the current playbook reads that aggressive tightening risks a material decline in housing, consumer confidence, and consumption that will eventually drive their respective economies into recession and send stocks tumbling.
“So until we reach peak inflation, which will trigger a less hawkish Fed and lower recession odds, it could be a gloomy summer for global stock pickers.” With AFP