Stocks fell Thursday, as investors stayed on the sidelines despite the government’s announcement that the economy grew 7.2 percent in the fourth quarter and 7.6 percent in 2022.
The announcement, however, pushed the value of the peso to 54.40 a dollar, the highest this year. The local currency gained 2.43 percent since the start of 2023 trading.
The PSE index, the 30-company benchmark of the Philippine Stock Exchange, tumbled 38 points, or 0.55 percent, to close at 7,042.70, as all six subsectors declined.
The broader all-share index also lost 9 points, or 0.27 percent, to settle at 3,692.89, on a value turnover of P5.11 billion. Gainers outnumbered losers, 107 to 99, while 49 issues were unchanged.
Three of the 10 most active stocks ended in the green, led by Figaro Coffee Group Inc. which climbed 5.62 percent to P0.94 following reports that Monde Nissin Corp. is acquiring a 15-percent interest in the coffee chain operator for P820.3 million.
GT Capital Holdings Inc. of the Ty family went up 2.74 percent to P525.00, while JG Summit Holdings Inc. rose 0.71 percent to P56.90.
Meanwhile, most Asian markets rose Thursday as the majority returned from the Lunar New Year break on an optimistic note, with inflation slowing and central banks hinting at a lighter approach to tackling prices.
Hong Kong led the way again, hitting an 11-month high, helped by hopes that China’s reopening will fuel a strong recovery this year, while Bloomberg News said travel and box office numbers for the holidays were encouraging.
But uneven earnings from tech giants largely kept sentiment in check and saw Wall Street end on a soft note, with the Nasdaq in the red.
Traders are now awaiting the release of US growth data on Thursday and the Federal Reserve’s preferred gauge of inflation Friday.
Still, Asia continued to outperform after a strong start to the year.
Next week, the Federal Reserve will make its latest policy decision since slowing its pace of rate hikes in December, after four straight 75 basis-point increases.
Speculation has been building in recent weeks that the bank could take its foot off the pedal as data points to inflation coming down quicker than expected and other indicators suggest last year’s tightening was taking hold in the economy.
And while there remains some concern that the world’s top economy could tip into recession, there is growing hope it can achieve a so-called soft landing.
Hong Kong jumped 2 percent Thursday to its highest level since early March, while Singapore, Wellington and Jakarta were also up. With AFP
Seoul gained more than one percent as data showed South Korea’s economy shrank in October-December—for the first time since the second quarter of 2020—giving the central bank room to tone down its pace of rate hikes.
London opened on the front foot along with Paris and Frankfurt. But Tokyo and Bangkok fell. Shanghai, Sydney and Taipei were closed for the holiday.
SPI Asset Management’s Stephen Innes was upbeat about the outlook for equities.
“Once we chop through the cudgel of earnings reports, one can reasonably expect the buyback tailwind to resume in force come February,” he said in a commentary.
“The opportunity set in non-US markets continues to look more attractive. And while China remains the faster horse in the race, still after a run of resilient activity data, lower gas prices, easier financial conditions and earlier China reopening, investors should take note of the solid non-recessionary vibes emanating from Europe.”
And Ricky Tang at Value Partners Group added: “On the economic front, the Chinese government has emphasised that the top priority for 2023 is to boost economic growth, so it is possible for the government to introduce more policies to support the economy in the coming months.”
He added that when Covid cases begin to subside “economic activities should gradually return to normal, paving the way to a stronger economic recovery”.
Oil prices rose and have consolidated around their November highs on China demand expectations, with officials saying the number of daily Covid deaths had fallen nearly 80 percent since the start of the month. With AFP