The stock market jumped Thursday to sustain a rally after Tuesday’s sharp fall, with select blue chip issues leading the advance.
The Philippine Stock Exchange Index surged 133.09 points, or 1.8 percent, to 7,630.26 on a value turnover of P5.6 billion. Gainers edged losers, 101 to 89, with 46 issues unchanged.
Bank of the Philippine Islands, the third-biggest lender in terms of assets, climbed 4.2 percent to P99, while Manila Electric Co., the largest retailer of electricity, gained 3.7 percent to P334.80.
Jollibee Foods Corp., the biggest fastfood chain, rose 3.6 percent to P283.80, while Metro Pacific Investments, which is into toll roads, water and electricity distribution, power generation and hospitals, advanced 3 percent to P4.79.
The rest of Asian markets, however, fell on Friday as fears of a trade war blasted back to the fore after Donald Trump imposed stiff tariffs on European, Mexican and Canadian steel and aluminum.
Hong Kong was slightly lower and Tokyo ended down 0.1 percent while Sydney lost 0.4 percent.
Singapore was 0.1 percent off and Wellington dropped 0.3 percent, but Seoul edged up 0.7 percent and Taipei was 0.7 percent higher.
Investors are now looking ahead to the Friday release of US jobs data, hoping for an idea of Federal Reserve interest rate policy.
Shanghai fell 0.7 percent, with no early boost to the companies listed for the first time on MSCI’s emerging market index.
Their inclusion means major investors wanting to track the index will now have to buy stocks in the more than 200 mainland firms, though their weighting for now is miniscule, making up just 0.4 percent.
The US tariffs sparked immediate countermeasures by Mexico and Canada, while the European Union threatened a similar response, throwing up the prospect of a painful conflict between some of the world’s biggest economies.
French President Emmanuel Macron labeled the move “illegal.”
It also overshadowed news that Italy’s populist parties had reached a deal to revive a coalition government and avoid a snap election that many had feared could be used as a referendum on the country’s euro membership.
However, while some say the measures—which followed US warnings that tariffs on some Chinese goods were still up in the air—are a White House ploy to gain the upper hand in ongoing talks, others warn the issue could escalate further.
“While markets overreacted to the Italian mess a couple of days back, it strikes me they might be under-reacting to the real—distractive—negatives of this trade skirmish developing into a trade war,” said Greg McKenna, chief market strategist at AxiTrader.
“My guess is that many traders and investors see this as another negotiating tactic from the Trump Administration,” he said.
“But we are now genuinely faced with the type of tit-for-tat trade spat, of which there will be few winners and which could materially impact global growth and relations.”
McKenna also warned Trump was at risk of being overwhelmed as he fights several battles at once, with North Korea, Iran and the Russia investigation at home among the other pressing issues demanding his attention. With AFP
