Stocks bounced back Wednesday, as early jitters over North Korea’s latest saber-rattling gave way to bargain-buying following the previous day’s loss.
The Philippine Stock Exchange index, the 30-company benchmark, gained 14 points, or 0.2 percent, to close at 7,848.84, as all six major sectors advanced.
The heavier index, representing all shares, also rose 15 points, or 0.3 percent, to settle at 4,712.70, on a value turnover of P6.5 billion. Advancers outnumbered losers, 114 to 87, while 43 issues were unchanged.
Eleven of the 20 most active stocks ended in the green, led by Century Properties Group Inc. which jumped 8.8 percent to P0.62 and Wilcon Depot Inc. which climbed 6.1 percent to P8.48. East West Banking Corp. went up 4.2 percent to P31.95.
Meanwhile, Asian stocks climbed as demand for haven assets ebbed even while geopolitical concerns remained in the wake of North Korea’s missile launch. European shares edged lower.
Traders ran for the sidelines in the morning after Washington confirmed that Pyongyang had for the first time tested a missile capable of reaching the United States, ratcheting up pressure on the already tense Korean peninsula.
But in the afternoon the selling and rush for safe-haven assets such as the Japanese yen reversed.
By the close Tokyo was up 0.3 percent, while Seoul also added 0.3 percent and Singapore jumped 0.8 percent. Hong Kong gained 0.5 percent in late trade after diving 1.5 percent Tuesday, and Shanghai ended 0.8 percent up. However Sydney finished 0.4 percent off while Wellington and Jakarta also edged down.
Despite the gains, dealers remain on edge and are now awaiting the next development after Russia and China issued a joint appeal to ease tensions while the United Nations Security Council will hold an emergency meeting later in the day.
The test came just as the US was preparing to celebrate Independence Day and days before a G20 summit, where it will likely top the agenda.
It was the latest provocation by North Korean leader Kim Jong-Un who is determined to develop a nuclear weapons program he says is needed to ward off invasion.
South Korea and the US on Wednesday launched a barrage of missiles simulating a precision strike against Pyongyang, in response to the provocation.
“Traders and investors may be wondering what reaction this latest missile test will get,” said Greg McKenna, chief market strategist at AxiTrader.
Traders were given few leads with European markets slightly down and Wall Street closed for the July 4 holiday.
Tech firms saw some much needed buying after suffering a recent sell-off as global central banks consider tightening monetary policy.
With Bloomberg, AFP
The sector has been a huge beneficiary of the years of cheap borrowing from lenders, sending their stock prices soaring but the prospect of an end to such largesse has led to profit-taking.
Hong Kong-listed Tencent edged up from Tuesday’s fall of more than four percent, while AAC Technologies also bounced and Sony jumped 0.8 percent in Tokyo.
Investors are awaiting the release Wednesday of minutes from the Federal Reserve’s June policy meeting and key US jobs data Friday. With AFP, Bloomberg
