Market climbs; AC Energy, Apollo Global lead gainers

The stock market rebounded Thursday in step with the rest of Asia, as investors await Joe Biden’s proposals for a vast new stimulus as well as comments from the head of the Federal Reserve on its policy outlook.

The Philippine Stock Exchange Index rose 30.30 points, or 0.4 percent, to 7,273.15 on a value turnover of P7 billion. Losers, however, beat gainers, 121 to 107, with 36 issues unchanged.

Magnetite iron miner Apollo Global Capital Inc., formerly Yehey! Corp.,  jumped 19.2 percent to P0.28, while Security Bank Corp., the seventh-largest lender in terms of assets, climbed 3.3 percent to P138.30.

AC Energy Philippines Inc., a unit of conglomerate Ayala Corp., rallied 7.3 percent to P6.65, while sister unit Globe Telecom Inc., the second-biggest telecommunications firm, advanced 4.1 percent to P2,130.

The rest of Asian markets mostly enjoyed fresh gains Thursday.

News that Donald Trump had been impeached for a historic second time appeared to have little immediate impact on sentiment, despite worries about more unrest across the US leading up to Biden’s inauguration on January 20, following last week’s storming of the Capitol.

Hopes for another huge spending splurge in the world’s top economy also overshadowed fears about surging virus cases—and record daily deaths in the US and Britain—that have forced governments to impose new lockdowns.

US markets rose and most of Asia followed suit.

Tokyo piled on 0.9 percent, while Hong Kong, Sydney, Seoul, Singapore, Mumbai and Jakarta were also in positive territory.

But Shanghai sank despite data showing a better-than-forecast rise in Chinese exports and imports last month. There were also losses in Taipei, Bangkok and Wellington.

Analysts said a drug being developed by pharma giant Johnson & Johnson could make a huge difference as it would only need one jab and can be transported more easily.

But for now, the focus is on the president-elect’s new economic rescue plan, which he has said would be in the trillions of dollars, with a push for $2,000 cash handouts.

“Investors are willing to look past the political big uglies (in Washington) to sunny days ahead,” said Axi strategist Stephen Innes.  

“Expectations are building for additional and perhaps larger fiscal stimulus efforts as pandemic priorities remain the first order of business for the Biden administration.”

However, there is a worry that with the Senate unlikely to debate the impeachment until after Biden takes office, his legislative program and cabinet confirmations could be held up.

Still, Innes added that traders were also soothed by comments from top Fed officials indicating they did not support winding down the bank’s enormous monetary easing program any time soon.

Fed boss Jerome Powell’s comments in a webinar later in the day will be pored over, hoping for a better idea about policy direction in light of Biden’s spending plan, which most observers think will drive inflation higher, and in turn interest rate expectations.

The bank’s gigantic bond-buying scheme and easy-money policies have been a key driver of markets’ recovery from their March troughs. With AFP