The stock market rallied Thursday on bargain-hunting, buoyed by a government report that the economy expanded 6.4 percent in the fourth quarter of 2019—the second-fastest in the region.
The Philippine Stock Exchange Index jumped 147.62 points, or 2 percent, to 7,616.35 on a value turnover of P6.6 billion. Gainers overwhelmed losers, 117 to 73, with 50 issues unchanged.
The gross domestic product of the Philippines grew 6.4 percent in the fourth quarter from a year ago, bringing the GDP expansion for the full of 2019 to 5.9 percent
“Compared with other major economies in the region that have already released their GDP growth in the fourth quarter, the Philippines likely ranked second only behind Vietnam’s 7 percent, and higher than China’s 6 percent growth rate in the fourth quarter,” said Economic Planning Secretary Ernesto Pernia, who is also the director-general of the National Economic and Development Authority.
The robust growth in the fourth quarter is drawing expectations that the economy will register a stronger expansion in 2020.
Major property developer Ayala Land Inc. climbed 3.6 percent to P40.80, while Metro Pacific Investments Corp., which is into electricity and water distribution, toll roads, hospitals and infrastructure, advanced 5.2 percent to P3.47.
Universal Robina Cop., the biggest snack food maker, surged 5.2 percent to P162, while Manila Electric Co., the largest retailer of electricity, rose 4.1 percent to P302.
Meanwhile, investor nerves over the spread of a deadly new virus from China hammered the rest of Asian equities and oil benchmarks on Thursday, as authorities moved to contain the disease.
More than 570 people have been infected with the coronavirus across China and Wuhan, the city at the center of the outbreak, has been placed under effective quarantine.
Shanghai tumbled 2.8 percent in the final day of trading before a weeklong market holiday for the Lunar New Year, when hundreds of millions of people travel across China—raising fears of the contagion spreading further.
It was the biggest pre-Lunar New Year fall on record for the bourse.
Hong Kong slightly pared losses to finish down 1.5 percent while Tokyo was 1.0 percent lower.
OANDA senior market analyst Jeffrey Halley said it was “quite understandable that some money would be taken off the table until the true extent of the coronavirus issue becomes obvious.”
The virus has caused alarm because of its similarity to SARS (Severe Acute Respiratory Syndrome), which killed hundreds of people in 2002-2003.
“China’s importance in the overall global supply chain and the fact they are a huge export market for many countries… opens up a more unfavorable global outcome this time around,” Stephen Innes, chief market strategist of AxiCorp, said in a note.
Oil prices were hit hard in overnight trade with both major indexes down by more than 1.3 percent.
“Given the importance of China for oil demand and having the outbreak falling on the cusp of peak domestic travel season, the timing is particularly damaging,” Innes said. With AFP