Local stocks and the peso moved up Monday as economic managers maintained the 2023 growth forecasts and more companies reported healthy earnings in the first quarter.
The 30-company Philippine Stock Exchange index climbed 77 points, or 1.20 percent, to close at 6,598.38, as four of the six subsectors advanced , with financials leading the way.
The index representing all shares also picked up 21 points, or 0.63 percent, to settle at 3,510.09, on a value turnover of P5.34 billion. Losers edged gainers, 96 to 94, while 47 issues were unchanged.
Seven of the 10 most active stocks ended in the green, led by Bank of the Philippine Islands Inc. which jumped 6.52 percent to P109.50. BDO Unibank Inc. gained 3.33 percent to P139.50, while Metropolitan Bank & Trust Co. added 2.56 percent to finish at P60.00.
The peso rose 0.45 percent Monday to close at 55.77 a dollar from 56.02 on April 20.
Meanwhile, Asian markets were mixed on Monday, with investors mostly treading water ahead of key data releases this week, including earnings results from US tech behemoths.
Europe opened lower and US equities futures were also down following a muted finish on Wall Street last week, with a wait-and-see mood taking hold of markets as they awaited results from the likes of Amazon, Microsoft, Google parent Alphabet and owner Meta.
“Mega tech earnings will be important this week for the rally in risk sentiment since the beginning of the year,” Tapas Strickland of National Australia Bank said.
Traders will also be looking for clues about the US Federal Reserve’s next steps on interest rates.
Though swaps markets indicate that some traders think a peak and subsequent cuts are just around the corner, upcoming US data on growth, inflation and wages could see that forecast change, analysts say.
Meanwhile, moves by leveraged investors suggest they foresee more rate hikes to come.
“The thought that the Fed is going to aggressively cut into year end is misleading,” Kim Strand, head of fundamental research and ESG integration for Franklin Templeton Investment Solutions, told Bloomberg Television.
“We believe what the Fed is saying: that it will hike and stay there until you see these areas of inflation coming down.”
Hong Kong, Shanghai, Sydney and Seoul were all down on Monday, while Singapore was flat.
London, Frankfurt and Paris also dropped in early Monday trade.
Mumbai, Tokyo, Wellington and Taipei rose.
Stephen Innes of SPI Asset Management said in a note that China’s rebound following the end of its growth-sapping zero-Covid policies was likely to cool, relying now on higher income growth and improved consumer sentiment.
“So the easy part is done; now, the consumer will need to do the bulk of the heavy lifting,” he said.
Also this week, investors will be watching important economic data from South Korea, Australia and the eurozone, as well as Bank of Japan chief Kazuo Ueda’s approach as he chairs his first key policy meeting.
Responding to questions in parliament on Monday, Ueda suggested the bank would stay the course in terms of monetary stimulus, adding that inflation was expected to cool below two percent in the second half of the fiscal year ending next March.
Credit Suisse, meanwhile, revealed on Monday that more than $68 billion was withdrawn in the first three months of 2023, in what are likely its final quarterly results before it is swallowed by rival UBS.
At the same time, the bank saw its net profit swell to $13.9 billion, up from a significant loss a year earlier, after holders of high-risk Credit Suisse debt were wiped out in the emergency takeover deal. With AFP
