Local stocks rebound as North Korea fears ease
LOCAL EQUITIES bounced back on Wednesday as investor concerns over ongoing geopolitical tensions with Japan, North Korea, and the US eased.
The bellwether Philippine Stock Exchange index rose 0.10% or 8.34 points to close at 7,956.73 yesterday, slightly recovering from Tuesday’s drop following North Korea’s launching of a missile over Japan.
The broader all-shares index likewise inched up by 0.02% or 1.32 points to 4,722.
“Stocks shrugged off the North Korean missile launch and regained their footing to close higher on Wednesday,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message.
“I think what happened [ on Tuesday] was a knee-jerk reaction because it surprised everyone even the big developed countries like the US. But at the end of the day it was nothing that created a panic or a crisis… The market accepted the situation and now is back to its sideways behavior,” Summit Securities, Inc. President Harry G. Liu said in a phone interview.
“So now the market is just waiting for a fundamental catalyst that will kick up 8,100 which I think in due time it’s more an upside market before the year ends,” Mr. Liu said.
Major US stock indexes also ended higher after recovering from steep early losses triggered by fears that hostilities in the Korean Peninsula could escalate.
Overnight, the Dow Jones Industrial Average rose 56.97 points or 0.26% to 21,865.37; the S& P 500 gained 2.06 points or 0.08% to 2,446.3 and the Nasdaq Composite added 18.87 points or 0.3% to 6,301.89.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose half a percent, taking cue from Wall Street’s higher close, as concerns about North Korea and Japan ebbed.
“Asian bourses may see some further stabilization if not recovery today as the risk-off concerns fade a little,” OCBC Bank said in a note.
Back home, four sectoral counters ended in the green, led by services, which booked an increase of 0.98% or 16.79 points to 1,714.89. The mining and oil subindex followed, climbing 0.26% or 34.24 points to 13,152.79; holding firms rose 0.18% or 14.67 points to 7,852.15; and industrials gained 0.05% or 6.28 points to close at 11,025.13.
On the other hand, the financials counter declined by 0.47% or 9.37 points to 1,978.42 and property dropped 0.14% or 5.31 points to 3,728.29.
Value turnover stood at P5.87 billion yesterday, with 1.29 billion issues changing hands, down from Tuesday’s P6.87 billion.
“Volume was low moving into a US Labor Day Holiday,” Regina Capital’s Mr. Limlingan said.
Decliners outnumbered advancers, 101 to 91, while 53 names were unchanged.
Net foreign selling widened to P55.91 million on Wednesday from the P19.37 million recorded the previous day. —