Market falls; Phinma Energy up

posted October 15, 2019 at 08:50 pm
by  Manila Standard Business
Stocks fell amid thin trading Tuesday following a three-day advance, as investors were fretting over the limited scope and lack of detail in last week’s mini China-US trade deal.

The Philippine Stock Exchange index, the 30-company benchmark, dropped 43 points, or 0.6 percent, to close at 7,840.31.  Despite the loss, it was still up 5 percent since the start of the year.

The broader all-share index went down 18 points, or 0.4 percent, to settle at 4,740.32 on a value turnover of P4.6 billion.  Losers outnumbered gainers, 111 to 65, while 63 issues were unchanged.

Six of the 20 most active stocks ended in the green, led by Phinma Energy Corp. which jumped 11.3 percent to P2.56. Alliance Global Group Inc. rose 3.8 percent to P11.48.

Meanwhile, Asian equity markets were mixed as investor caution returned, replacing the optimism fanned by Donald Trump’s much-vaunted China trade deal.

While Friday’s mini-agreement between the world’s economic superpowers put off fresh tariffs and saw them reach common ground on some issues, observers pointed out it was light on detail and left other major levies in place.

And despite Trump’s insistence that the “phase one” agreement was “the greatest and biggest deal”, Beijing said it wanted to hold more talks and called for a delay in other tariffs due in December before it would sign.

Equity traders, who have been under pressure from the trade war as well as the slowing global economy and worries about Brexit among others, seized on Friday’s announcement and sent regional markets surging Monday.

But they struggled to build on that as questions swirled over the value of the deal.

“It has taken precisely one working day of the new week for optimism to fade about the US-China trade deal lite/mini/part one,” said Jeffrey Halley, senior market analyst for Asia-Pacific at OANDA.

“The rhetoric-high, but detail-light trade announcement in Washington DC on Friday has been tempered by China being both a lot more circumspect and requesting additional talks before signing an agreement.”

He said that while he expected the two to hammer out something for Trump and counterpart Xi Jinping to sign before they are due to meet next month, “the pseudo-deal itself represents nothing more than a holding action”.

Still, US Treasury Secretary Steven Mnuchin said on Monday that officials would hold further talks by phone this week and the next to finalize the deal.

He also defended it on CNBC.

“There is a fundamental agreement in principle,” he said. “There are still some issues that need to be worked out in wording but I would say we have every expectation that phase one will close.”

Hong Kong slipped 0.1 percent and Shanghai ended down 0.6 percent, while Singapore, Bangkok, and Manila were also in the red.

But Tokyo jumped 1.9 percent as dealers returned from a long weekend to play catch-up with the rest of Asia.

Sydney added 0.1 percent, Seoul was flat and Taipei put on 0.4 percent. Wellington, Mumbai, and Jakarta were also higher. With AFP

Topics: Philippine Stock Exchange , Phinma Energy Corp. , Alliance Global Group Inc.
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